Landscape after the special operation: the "golden" billion will remain without gilding

Dmitry Milin, analyst

In Ukraine, hostilities are still in full swing, a significant part of people still hope for a Miracle from Ukraine receiving a modern “wonder weapon”, but I got the impression that militarily everything is already a foregone conclusion and the only question is how many people will die before the end peace negotiations. However, the consequences of what happened for all participants in the conflict are already becoming clear.

The sanctions imposed by the West failed - they could not stop the fighting. In fact, the sanctions have so far failed to reduce the volume of export earnings received by Russia, failed to collapse the ruble exchange rate and disrupt the operation of the Russian banking system. Yes, in the future they will lead to a fall in GDP due to a break in production chains, but this will most likely happen after the end of hostilities in Ukraine.

Russia was under sanctions for decades. The experience of the first month of hostilities showed the weaknesses of the RF Armed Forces, over the elimination of which serious work will begin in the next 5-15 years, and not the same as with SAP-2016/2020. Russia will begin to militarize, which will lead to growth in the sector of SMEs serving defense enterprises (Russian defense enterprises are, in fact, a "sign" and a conglomerate of hundreds or thousands of SMEs doing the bulk of the work).

It is obvious that the sanctions will lead to a fall in GDP in 2022 by 5-10%, but already in 2023, despite forecasts, a serious recovery growth is possible instead of falling, because in addition to growth in the defense sector of the Russian economy, (regardless of the start of the NEP) or not) growth in the import substitution sector, where SMEs will spontaneously eliminate “commodity hunger” - goods that have disappeared from the shelves due to sanctions and the departure of foreign companies.

Ukraine lost. Lost economically. Already, Ukraine's budget revenues cover only a third of the costs. After the peace treaty, which will lead to the loss of a significant part of the territory, Ukraine will be forced to default, and possibly on loans from the IMF. However, this will not save Ukraine from the return of debts for weapons received from the sponsors of the war.

The infrastructure and industry of Ukraine will never be restored to the pre-war level. De facto de-industrialization of Ukraine will take place. In addition to the huge loss of life due to hostilities, Ukraine will face the fact that a significant part of the refugees will not return or will return to the territories occupied by Russia. Ukraine will not have to wait for significant investments after the default.

The West finally destroyed the system of international security that emerged after the end of the Cold War. Pushing Russia away from itself, the West forced it into a military-political alliance with China and all the opponents of the West.

In fact, two opposing military-political coalitions of the USA + England + Japan + Australia + Canada and Russia + China are now being created in the world, between which the rest of the countries will drift, splitting the world into a configuration for the 3rd World War (nuclear and biological) war.

I did not specifically mention Europe in the "Western Union". I have serious fears that the conflict of 02/24/22, which showed the lack of combat potential and ammunition stocks in European countries for waging a long war, will bring to life a chimera of the European army, which will lead to the emergence of a third, independent, player of the future 3rd World War.

Imposing “collective guilt” on Russians will not lead to democracy in Russia, but rather to the coming to power after Putin of real fascists. The lesson of Hitler, who came to power after WW1 due to the imposed “collective guilt” of the Germans and the economic problems of paying reparations under the Treaty of Versailles, turned out to be not learned by the “collective West”. And now the West, with sanctions that damage primarily ordinary Russians, and not the Putin regime, and imposing “collective guilt” on Russians for February 24, 22, is repeating the mistakes that led to WW2, but now not with Germany, but with Russia, which has the second, if not the world's first nuclear arsenal. This is the suicidal policy of the Biden administration.

The sanctions imposed against Russia and causing an increase in energy prices around the world are triggering a global stagflationary crisis (rising inflation with a fall in GDP), which, against the backdrop of the collapse of globalization and the forced localization of industries, will lead to a drop in living standards around the world, including developed countries. With the "golden billion" gilding will largely come down.