Putin starts an economic war – an economist at the Ministry of Defense

In a surprise move, Russian President Vladimir Putin appointed a political economist as his new defense minister, in an attempt to prepare Russia for an economic war, try to make better use of the defense budget and harness greater innovation to achieve victory in Ukraine.

More than two years into the conflict that cost both sides heavy losses, Putin nominated Andrei Belousov, a 65-year-old former deputy prime minister and economist, to replace his old ally Sergei Shoigu, 68, as foreign minister. defense minister.

“The proposal to appoint a top economist to head the Ministry of Defense may mean that Putin plans to win the war with defense industry factories and international markets.”

Putin wants Shoigu, who has been in charge of defense since 2012 and is a long-time friend and ally, to become secretary of Russia’s powerful Security Council, replacing current President Nikolai Patrushev, and also to take charge of the military-industrial complex, the Kremlin.

Patrushev will find a new job that has not yet been announced.

The changes, which lawmakers are sure to approve, are the most significant changes Putin has made to military leadership since he sent tens of thousands of troops to Ukraine in February 2022.

Like the Soviet Union

Kremlin spokesman Dmitry Peskov said the change made sense because Russia was approaching a situation like the Soviet Union in the mid-1980s, when the military and law enforcement accounted for 7.4 percent of gross domestic product.

This means it is necessary to ensure that this spending is aligned and better integrated into the country’s overall economy, which is why Putin now wants a political economist as defense minister, Peskov said.

“The one who is most open to innovations is the one who will win on the battlefield,” Peskov said.

As CNBC notes, Belousov, a former economy minister known to be very close to Putin, shares the Russian leader’s vision of rebuilding a strong state and has also worked with top technocrats under Putin who want more innovation and are open to new ideas.

Belousov played an important role in supervising Russia’s drone program.

This step shows that Putin intends to escalate the conflict and seeks to exploit more of the Russian economy in the war, after the West sought, but has failed so far, to flood the Russian economy with sanctions.

Economic war

Russian economists have so far largely managed to secure economic stability and growth despite the harshest sanctions imposed on any major economy.

“The proposal to appoint a top economist to head the Defense Ministry could mean that Putin plans to win the war with defense industry factories and international markets,” said Alexander Paunov, a former Russian diplomat who is now a senior fellow. At the Carnegie Russia Eurasia Center.

The coup gives Shoigu a job considered technically superior to his role in the Ministry of Defense, ensuring continuity and saving Shoigu’s face. Valery Gerasimov, the chief of the Russian General Staff and the person with a more practical role in running the war, will remain in his post.

Shoigu has been heavily criticized by Russian military bloggers for a series of withdrawals the Russian army was forced to make in 2022. Yevgeny Prigozhin, the leader of the Wagner mercenary group and one of Shoigu’s harshest critics, led the failed rebellion that hoped to overthrow Shoigu. . Prigozhin was later killed in a plane crash.

source: after that