Russian Economist Fired After Warning of Social Crisis

Russia’s state-owned development bank, VEB, fired its Chief Economist, Andrei Klepach, for critical remarks he made at a financial forum in May. Klepach pointed out that Russia is lagging behind the West, China and, in a certain sense, even Ukraine, both economically and technologically, while warning of the rising costs of the war and a looming social crisis. The bank confirmed his departure but did not specify the reasons.

In his speech, the former high-ranking official at the Ministry of Economy emphasized that although Russia is weathering the sanctions, Ukrainian attacks on refineries and logistics infrastructure are exacerbating economic problems and inflationary risks.

At the same time, he criticized the deteriorating quality of government management, uncoordinated monetary and industrial policies and the country’s excessive dependence on China.

While President Vladimir Putin claims that the Russian economy is stable, the central bank has indicated that the economy may not grow at all this year. Klepach’s remarks represent a rare instance of public criticism from within state institutions. However, he predicted that continued underperformance could unexpectedly lead to serious social unrest.

(Reuters, Max)