Russia will be using second-grade tech for years and spending ‘huge resources’ to recreate what already exists, says a former top Russian finance official

Oleg Vyugin, former Russian finance ministry and Bank of Russia official, said “sanctions work.”

Sanctions against Russia will hit tech goods, former finance official Oleg Vyugin told Reuters.
Russia’s tech industry relies on imports, so it will have to recreate those goods domestically.
Russia’s tech development will decline if the situation doesn’t improve, said Vyugin.

Russia could be in for years of decline in technology development due to sweeping sanctions over the Ukraine war, Oleg Vyugin, a former high-level finance ministry and central bank official, told Reuters in an interview on Tuesday.

That’s because when it comes to tech, Russia relies on imports, and imports have been hit by sanctions and boycotts. As a result, the country will have to develop its own products to substitute those imports.

“The world will move forward, but Russia will only use some second-grade technology and spend huge resources to recreate what there already is in the world, but can’t be imported,” said Vyugin, who was a deputy finance minister and deputy governor at the Bank of Russia. He retired from the Moscow Exchange this year.

Vyugin also told Reuters “sanctions work,” as Russia’s economic growth has been impacted negatively.

Vyugin’s comments stand in contrast to President Vladimir Putin’s positive assessments of the economy. In early September, Putin said the country’s economy was coping with Western sanctions. Almost seven months into the war, Russia’s economy does continue to appear resilient. The energy giant’s economy has been bolstered by energy exports on the back of high prices, which were on the rise even before the war.

But imports into Russia have been severely crimped, which shows up in a record high current account surplus of $70.1 billion for the second half of 2022. Current account surplus is a key gauge …read more

Source:: Businessinsider

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