Countries around the world have experienced spiralling inflation reminiscent of the stagflation crisis of the 1970s, with prices for food, fuel, and other essential goods on the rise. Economists have blamed factors including the global supply chain crisis, poor energy planning, COVID-related shocks, and turbulence stemming from the Ukraine crisis.
Anti-Russia sanctions seem to have boomeranged on those who implemented them, and developed economies haven’t seen such high levels of inflation in decades, Russian President Vladimir Putin has said.
“No matter how stable the economies of the countries that pursue such a short-sighted policy, the current state of the world economy shows that our position is correct and justified, even looking at macroeconomic indicators. These developed countries haven’t seen such inflation in 40 years, unemployment is on the rise, supply chains are being broken, and global crises are intensifying. And in such sensitive areas like food – this is not a joke, these are serious things, which affect the entire system of economic and political relations”, Putin said, speaking at the Eurasian Economic Forum on Thursday.
Commenting on the West’s freeze of hundreds of billions of dollars’ worth of Russian assets abroad, Putin warned that such “theft” cannot lead to anything good in the long run.
“The violation of the rules and norms in the field of international finance and trade cannot lead to anything positive. And to put it simply, it will only lead to problems for those who engage in such behaviour. The theft of other people’s assets has never brought anything good for anyone – especially those who engage in such malign activities”, Putin said.
On the matter of foreign companies’ mass exodus from Russia over its special military operation in Ukraine, Putin suggested that their departure may be for the best, with domestic manufacturers taking their place and market share.
“Many of our partners from Europe have announced that they are leaving. You know, sometimes, you look at those who are exiting and think, perhaps, ‘thank goodness’. We will fill these niches. Our business, our production has grown and will safely sit on grounds prepared by our partners…Nothing will change, and those who want to bring in some kind of luxury goods, they will be able to do so, but it will be a little more expensive for them. But these are people who drove around in 600 Series Mercedes cars. And they’ll continue to do so, I assure you, and will bring them in from anywhere, from whatever country”, Putin said.
But this “isn’t important” for Russia, the president suggested. “For the country, for its development, engineering centres, scientific centres that are the basis of its development are what is important. This is what we should think about, and what she would work on both within the Eurasian Economic Union and in a broad sense with our partners – those who want to work with us”, he said.
At the same time, Putin stressed that Moscow has no intention of cutting itself off from the advanced technologies available in developed countries, and assured that it would be impossible for the West to “squeeze” Russia out and deprive it of access to such tech in today’s world.
Eurasian Economic Union, Greater Eurasian Partnership
Putin boasted that the Eurasian Economic Union, which includes Russia, Armenia, Belarus, Kazakhstan, and Kyrgyzstan as members, has already achieved a 75 percent rate of settlements in national currencies, and promised that work would continue “on interfacing and mutual use of national payment systems and bank cards” among the countries.
The Russian president stressed that Eurasian integration is not connected to any situation in the world political arena today, and recalled that the integrative process was launched at the initiative of former Kazakh President Nursultan Nazarbayev in the mid-1990s. Recalling his conversations with Nazarbayev about the EEU initiative, Putin said that the Kazakh president had emphasised that Russia would need to choose between more actively and closely cooperating with its post-Soviet partners, or joining the World Trade Organisation.
“While we did not exclude our interest in joining the WTO and building relations with Western partners, we nevertheless considered the building of relations with our immediate neighbours and natural partners within the common economy of the Soviet Union as the highest priority”, Putin said.
The Russian president also suggested that the Greater Eurasian Partnership project, supported by the EEU and by major global powers including India and China, could become a “civilisational project” that changes the global political and economic architecture.
“In the current international environment, when, unfortunately, traditional trade and economic ties and supply chains are being destroyed, the Russian initiative to form a Greater Eurasian Partnership takes on a special meaning…We are grateful to the leaders of EEU member nations, who supported this proposal from the very beginning, and BRICS members China and India, as well as a number of other countries who have expressed interest in this initiative, including members of the Shanghai Cooperation Organisation, ASEAN, and others”, Putin said.
“The main idea is to create a common space of equality-based cooperation for regional organisations. The Greater Eurasian Partnership is designed to change the political and economic architecture – to become a guarantor of stability and prosperity of the entire continent, taking into account the diversity of development models, cultures and traditions of all its peoples”, he added.
Russia first proposed the idea of a Greater Eurasian Partnership in 2016.
Commenting on Putin’s remarks at Thursday’s meeting, Khazakh President Kassym-Jomart Tokayev said that the Greater Eurasian Partnership deserves detailed study, and that sooner or later, it will be implemented by the EEU.