Fortress Russia: The Rise of an Insular Economy
Over the past three years, Russia has transformed into a 'fortress' economic model, confiscating $50 billion worth of assets. This shift reflects heightened domestic security priorities, straying from the previous open economy approach. Foreign and domestic businesses face increased risks amidst tightened governmental controls and asset seizures.
In a notable shift towards economic insularity, Russia has seized assets worth 3.9 trillion rubles, equivalent to $50 billion, over the last three years, as part of its 'fortress Russia' model, reported Kommersant. This evolution underscores a departure from a relatively open economy towards stringent state control.
Foreign firms have been on edge since Russia's military incursion into Ukraine in 2022, facing potential asset confiscations under the pretext of strategic stability. Notably, domestic assets too are under scrutiny, reflecting Putin's administration's tactic of fortifying the internal economy against perceived external threats.
Kommersant, citing the NSP Law Firm, advises entrepreneurs to mitigate risks by aligning with state-owned enterprises and minimizing exposure to Western associations. With asset seizures justified on grounds of strategic company law and corruption, Russia's economic landscape is poised for more stringent governance.
(With inputs from agencies.)
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