The war economy has fallen ill with the Dutch disease: rising oil prices and economic income lead to “reverse import substitution”
The additional revenues that fell on the Kremlin due to the sharp rise in oil prices and the easing of sanctions did not lead to a revival of the Russian economy. On the contrary, the influx of currency contributes to the further strengthening of the ruble, the exchange rate of which has returned to pre-war values. As a result, the revival of domestic demand is covered by expanding imports.
