- Oleg Vyugin, a former finance official told Reuters that Russia will impose sanctions on tech products.
- Russia’s tech sector relies heavily on imports. Therefore, it will have to produce those goods locally.
- Vyugin said that Russia’s tech growth will drop if the situation does not improve.
Russia could experience years of technology decline due to the sweeping sanctions imposed on Ukraine. Oleg VyuginA former official at the central bank and high-ranking finance ministry told ReutersInterview on Tuesday
Because Russia is dependent on imports when it comes tech. And imports have been hard hit by sanctions. Russia will need to create its own products in order to replace imports.
Vyugin, a deputy finance Minister and deputy governor of the Bank of Russia, stated, “The world will progress, but Russia won’t use any second-grade tech and spend enormous resources to recreate the existing world,” This year, he retired from the Moscow Exchange.
Vyugin also said to Reuters, “sanctions works,” because Russia’s economic growth is being negatively affected.
Vyugin’s comments are contrary to President Vladimir Putin’s positive assessments about the economy. In early September Putin spokeThe economy of the country was capable of coping with Western sanctions. Nearly seven months into war, Russia’s economydoes appear to be resilient. Exports of energy have boosted the economy of the energy giant. High prices, which were already on the rise before the war.
Imports into Russia have been severely curtailed, as shown in this article Record high surplus in the current accountFor the second half 2022, $70.1 billion. Current account surplus, which is a key indicator of trade flows and investment flows is a major component of the measure.
Russia attempted to counter sanctions by replacing imports from sanctioned countries with domestic options or substituting them with non-sanctioned alternatives. Analysts at the Institute for Strategic Studies say that Russia has had limited success in countering sanctions. Bruegel,The late March report was written by a Brussels-based thinktank.
The analysts wrote that “high-tech products can be developed using inputs form many countries but few of them are able to function without inputs originating from the European Union and the United States.” “A single economy cannot duplicate the global network’s capabilities.
According to the Bruegel analysts, these imports are disproportionately affected by semiconductor chips and aviation parts.
Russian state-owned carrier AeroflotSanction-induced shortages have already prompted the government to start removing spare parts from operating aircraft. Reuters reported in August.
Vyugin said that Russia will experience a decline in technological development if the situation doesn’t change.
