Russia‘s economic crisis is a “strong blow” to Vladimir Putin and a sign that he is “losing the war with the West, the Russian President’s former speechwriter tells the Daily Express.
The Russian Central Bank has suspended the purchase of foreign currencies until 2025 after the Ruble collapsed in recent weeks.
This comes as Moscow’s currency was trading as low as 114 against the dollar.
Abbas Gallyamov, a speechwriter for Putin during his four years as Russian Prime Minister between 2008 and 2012, believes the economic crisis in Russia could be extremely damaging to Putin.
He said: “It’s a strong blow to his legitimacy. It’s a reminder of the hated nineties.
“It’s an indicator that he is losing the war with the West, that the sanctions are working. It’s another sign that the famous ‘Putin’s stability’ is over.
“A lot of oligarchs, including those who are very close to Putin, are publicly criticising financial authorities. It’s another sign of the system going loose.”
Putin’s allies have already tried to downplay the collapse of the Ruble.
Dmitry Peskov, the Kremlin’s spokesperson, said: “Russians won’t notice the dollar exchange rate increase because they are paid in Rubles.”
Russia’s finance minister, Anton Siluanov, added: “I am not saying whether the exchange rate is good or bad. I am just saying that today the exchange rate is very, very favourable for exporters.”
However, some Russian oligarchs have already voiced their anger with the situation.
Alexey Mordashov, chairman of steel and mining company Severstal, told RBC: “It’s as if the medicine is more harmful than the disease.
“We need serious discussions on this topic. This is a situation probably without precedent in modern world history, when the central bank rate is 2.5 times higher than inflation, and it still doesn’t slow down.”
Even Kremlin-controlled Russian newspapers are sounding the alarm over the economic crisis.
As reported by BBC Russia Editor Steve Rosenberg, the government newspaper Rossiyskaya Gazeta published a story headlined “Panic attack for Russia‘s currency market.”
Moskovsky Komsomolets added: “The brake has snapped on the Ruble.”
Nezavisimaya Gazeta reported that the Ruble collapse is “not only a substantial but also spectacularly fast worsening of the Ruble’s situation, that becomes a statistically important inflationary factor with negative consequences for the domestic market.”
Russia‘s economy has been on a war footing since Putin launched his invasion of Ukraine in 2022.
In fact, Putin is now allocating a third of Russia’s 2024 budget to military spending.
Western sanctions have also led to brutal inflation in Russia, causing the price of food products like potatoes, eggs, and butter to increase by tens of percent.
In an effort to bring down inflation, the Russian Central Bank raised interest rates to a record 21%, and reports from Russian media have suggested this could rise again to 23% in December.
