Newswise — On the heels of President Putin's actions in the Crimea, Lisa Baglione, Ph.D., chair and professor of political science at Saint Joseph's University in Philadelphia, offers comments on what sanctions will mean for the Russian economy as a whole, as well as the crippling hit to the Crimean tourist industry.
"Some commentators are arguing that the Russian takeover of Crimea is an enormous victory for Russia, but this is a shortsighted view. Russia, even without the sanctions that are going to be imposed, was heading into troubled economic times. Now, with the economic restrictions, Russia’s financial picture is looking bleak. Moreover, Kiev has had to pour money into Crimea, and that region was dependent on the central government for oil and gas. The financial picture in Crimea will be even worse this year, because its main revenue generating industry —tourism — is threatened by the recent events. The Crimea was a place that many Ukrainians and middle class Russians, who are far less affluent than middle class Europeans, would go for a summer holiday. This year, expect the Ukrainians not to travel there, and observers believe that the Russian government is going to have to virtually give away travel packages to its citizens so that the Crimean economy doesn’t implode.
And what does this mean for President Putin and Russia as a whole? President Putin’s poll ratings are higher than they have been in five years, when his popularity received another big bump from the Russian invasion of Georgia, which led to that state’s —and few others’ — recognition of Abkhazia and South Ossetia as independent states. An economy that provides opportunities for consumption, political stability, and international prestige has been the key to the widespread support for Putin. With the new challenges to the economy, Putin may worry about his hold on power — which he’d like to keep until 2024. Recent events, however, have shown him that bellicose international action serves him well as a way of distracting citizens from declining living conditions. If Putin’s aggressiveness is driven by poor economic conditions and the need to maintain popular support, expect Russian international assertiveness to increase over the next few years."
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