The sanctions implemented by the European Union against leading economic and political policy-makers and the Central Bank of the Russian Federation (CBR) are having serious consequences for the Russian economy. With many multinational American and European companies having pulled out of Russia, and the country being shut off from its US dollar and euro investments in the United States and the Eurozone respectively, Russia now finds itself in an adverse economic climate, mainly due to the destabilization of the ruble. Despite the successful short-term measures taken by the CBR since the beginning of the war to support domestic demand, ruble conversion rates to US dollars and euros do not look promising. 

Nor could the measures taken by the Russian government to prevent widespread corporate insolvency shortly after the beginning of the war stop the massive loss of human capital. Since the breakout of the war, many highly qualified professionals have left Russia for other countries in the post-Soviet region, for example Georgia and Armenia, while others have emigrated to Turkey, the Baltic states, Poland, Western Europe, and North America. However, the European Union’s hesitation to strive for independence from Russian gas has given the Russian economy some financial leverage, allowing the Russian war of aggression in Ukraine to continue. At the same time, the introduction of a yuan-based liquidity instrument for Russian banks is further laying the grounds for closer economic and financial relations between Russia and China.