Russia panics over the falling rouble
Enjoying this newsletter? Get it in your inbox every weekend, as well as our daily round-up of The Economist’s best journalism, by signing up for free here
Hello from London,
You can measure the growing problems for Russia’s economy in various ways. A long-term one, I think, is human capital. Because the war has killed, injured and diverted so many would-be workers there aren’t enough people to fill jobs. (Russia’s long-term demographic woes add to the problem.) Government spending on the war helps to prop up economic growth but is also driving up inflation. And the falling price of oil, an important export, brings pain. Interest rates, meanwhile, are being kept high in order to prop up the rouble. And yet, as our new article explains, Russia’s currency has been sliding, to levels last seen soon after the invasion of Ukraine began in 2022.
Some of the latest rouble trouble appears to be linked to sanctions that America imposed late in November on Gazprombank, a Russian outfit previously not targeted. This bank, it appears, has been a crucial financial clearing house for Russian energy exports. If the Americans have decided to expel it from the global financial system, that makes it harder for Russia to trade. Those who still buy Russian energy exports will find it ever more difficult to pay for them. My question: why wasn’t this loophole closed, say, a year ago? It’s being done now in order to ratchet up pressure on Vladimir Putin. Personally, I wish that pressure had been imposed earlier.
Nothing happens in isolation. That’s one lesson to take from the latest round of violence in Aleppo, where a rebel group, a former al-Qaeda affiliate, swept into Syria’s second city in recent days. Their attack surprised government forces. In previous years of Syria’s long civil war Bashar al-Assad, the repressive ruler, could have called on allies such as Russia and Iran for help. They won’t abandon him now. Russian jets have been bombing rebel positions in Idlib, near the Turkish border. But Russia is preoccupied with its effort to conquer parts of Ukraine. The clout of Iran is also reduced. The same goes for Hizbullah, the fighting force in neighbouring Lebanon, which has been battered by Israel. As our analysis of the Aleppo developments observes, had Hamas not attacked Israel in 2023, triggering a wider conflict, Mr Assad might not be losing further control today.
It is a wretched situation for civilians, including refugees who fled into Syria to escape fighting in Lebanon in recent months. The ceasefire across the Israel-Lebanon border, and a potential widening of the war in Syria, means people will now flow back the other way. Aleppo was once a charming place to visit. I went, long before war began, and marvelled at its tourist attractions, including the citadel. Today rebel fighters pose by that castle—which was restored and reopened in 2018 after earlier fighting—for the same sort of snaps that my wife and I took a quarter of a century ago.
Our games are live: play Dateline, to guess the year when notable events happened, and our news quiz, if you prefer to test your short-term memory.
Adam Roberts, Digital editor
Recommended reads
Supplies from China are about to become more expensive
Russia and Iran, the Syrian dictator’s closest allies, will be of less help than they used to be
Xi Jinping has set out his tariff red lines. What if America crosses them?
A more fragmented media is tougher to manage
Negotiations that are not backed up by military muscle merely let armed groups expand
Most read by subscribers
OK Boštjan Dolinšek
Chairman / Former President of Executive Committee in the Pakistan Association of the Deaf
2wIn the Deaf community, there has long been a challenge in understanding the meanings of Quranic verses, as no dedicated signs for Islamic or Quranic concepts existed. This included Surah Fatiha, the most fundamental chapter of the Quran, whose profound meaning was inaccessible to many. Pakistan Association of the Deaf, after extensive research and dedication, is proud to have developed the complete Islamic Sign Language for Surah Fatiha, making its message accessible to the Deaf community for the first time. Today, during the prestigious event organized by the Department of Empowerment of Persons with Disabilities, we witnessed a historic moment as our talented student, Abdul Qadir, recited Surah Fatiha in Sign Language. This initiative is a step toward empowering the Deaf community to connect with their faith in a meaningful way. Alhamdulillah, we are grateful for this opportunity to serve and create a positive impact. Watch this beautiful and groundbreaking performance and join us in celebrating inclusivity, accessibility, and faith. #PakistanAssociationOfTheDeaf #IslamicSignLanguage #SurahFatihaInSignLanguage #DeafCommunity #InclusionAndAccessibility #EmpoweringThroughFaith https://fb.watch/whoTubDxEj/
--
2wZ
Futurist | Evolutionary Cyberneticist | Philosopher of Mind | Author | Filmmaker | CEO, Editor-in-Chief @ Ecstadelic Media Group | alexvikoulov.com | ecstadelic.net
2wFake news! Nobody is panicking in Russia! The quality of life and the happiness index there is now higher than in most Western countries. Go to Russia to see for yourselves. I'm sure you'll be impressed! You'll see a drastically different picture of what politicized Economist leads you to believe!
control room operator
2wNow stop the ghost ships!