December 31, 2023

US Treasury reports that sanctions and export controls are impacting Russia’s war with Ukraine

The US Department of Treasury recently published a blog revealing that sanctions and export controls issued by the United States and its partners are having a negative impact on Russia’s economy and Putin’s ability to wage war.  While the Treasury Department acknowledged that Russia was able to fund the war in the short-term, the Department reports that Russian leaders have been forced to sacrifice long-term prospects.  The impacts of three forces – the war, sanctions imposed by the United States and its partners, and policies imposed by the Russian government in response to those measures – are allegedly forcing Russia to reorient its economy away from private consumption and towards defense spending at the expense of private citizens, whose long-term living standards are expected to decline.

The Treasury Department offered four key conclusions regarding the impacts of sanctions and related measures on Russia’s war with Ukraine:

  1. The war combined with the impact of sanctions by the United States and its partners is causing Russia’s macroeconomic performance to suffer and causing Russians to leave the country.
  2. The fiscal pressure on Russia is increasing due to growing expenditures and the impact of sanction on revenues.
  3. Policies imposed by Russia in response to our sanctions are becoming increasingly expensive for Russia.
  4. Innovative measures taken by the US and its partners have prevented the global economy from suffering unnecessary damage from Russia’s war.

US Department of Treasury Press Release | Blog