The Russian economy is weakening and sanctions are working. On June 11, the International Centre for Ukrainian Victory (ICUV) held a closed-door meeting “From STRENGTHENING SANCTIONS TO total economic isolation of THE RUSSIAN ECONOMY.” The event brought together Ukrainian analysts, representatives of embassies, and political experts to discuss the effectiveness of sanctions policy and the potential of Russia’s economic vulnerability as a tool to help bring the war to an end.
Among the speakers were leading Ukrainian experts:
- Hanna Hopko – Founder and Head of the Board of National Interests Advocacy Network (ANTS), co-founder of the International Center for Ukrainian Victory (ICUV);
- Mykhailo Gonchar – Ukrainian energy and international relations expert, President, The Centre for Global Studies “Strategy XXI”.
- Illia Neshodovsky – Head of the Analytical Department at the National Interests Advocacy Network (ANTS);
- Olena Sas – Expert in monitoring and analysis of information, project manager of the National Interests Advocacy Network (ANTS);
- Volodymyr Vlasiuk – CEO of Ukrainian Industry Expertise.
This time, the discussion focused on the rapid deterioration of the russian economy, which is becoming increasingly incapable of sustaining the burden of war. After three years of wartime stagnation, russia has entered a recession. In 2025, GDP growth has slowed to 1.7%, with international forecasts projecting an even more modest annual increase of just 1.6%. Inflation is expected to reach between 7% and 8.2%, while the federal budget deficit continues to grow. At the same time, military spending keeps rising. In the first quarter of 2025 alone, russia allocated 5.3 trillion rubles to defense and security. However, the country is no longer able to maintain its war machine without facing severe domestic consequences. The economy is cracking, yet the war continues at the expense of the russian people.
Participants discussed the key financial resources that have allowed russia to continue waging war: the National Prosperity Fund (NPF), oil and gas revenues, and the issuance of rubles. Experts emphasized that these resources are rapidly being depleted, and in the coming months, the Kremlin will face a stark choice, either scale back the war or lose control over the economy.
That is why it is crucial to continue strengthening the sanctions regime. The economic isolation of russia must remain a core part of the united strategy of Ukraine’s allies. Only decisive and sustained pressure on the aggressor’s economy can amplify the impact of military aid to Ukraine, weaken the Kremlin, and bring us closer to lasting peace.
