The deteriorating investment climate which followed Russia’s 2014 annexation of Ukraine’s Crimea is causing losses of at least $30 billion every year, economist Sergei Guriev said in an interview with journalist Elizaveta Osetinskaya published Monday.
Russia’s 2014 annexation of the Black Sea peninsula from Ukraine has weakened Russia’s relations with the West, launching multiple rounds of sanctions from the U.S. and the EU as well as a drop in foreign investment.
Each percentage point that doesn’t go into GDP growth equals a loss of $15 billion, Guriev, who is chief economist of the London-based European Bank for Reconstruction and Development (EBRD), told business outlet The Bell. The Russian economy grew by 2.3 percent in 2018, according to official data.
“If it’s 2 [percentage points lost], then [Russia’s losses total] $30 billion a year,” he said.
Up to $300 billion has been lost since Russia annexed Crimea, the Bell cited Guriev as saying, adding that the Bank of Russia puts the losses at $320 billion.
“In total, something like $1 trillion has fled Russia in 20 years,” he said.
He forecast Russia’s economic growth of 1.5 percent to 2 percent amid a general lack of reforms.