Putin is gambling away his economic potential

Berlin Vladimir Putin has eleven members of the government and Gazprom boss Alexei Miller connected on a huge screen in his dark-brown paneled room. The Russian President gives a speech. It is a speech of promises to his people, who have been suffering from economic misery for years. The people should get free gas connections in remote regions. Pensions are to rise by 8.6 percent instead of the planned 5.9 percent.

That was a few weeks ago – and the situation has worsened since then. It is above all the high inflation that is troubling the Russians. In seven steps, the central bank raised the key interest rate in 2021 to 8.5 percent.

In the past year, inflation had skyrocketed to 8.4 percent – ​​twice the rate forecast by the central bank. There was a veritable explosion in prices for important foods: potatoes, for example, cost 50 percent more, cabbage even 100 percent.