Russia’s military invasion of Ukraine (officially named in Russia the “special military operation”) has become a pivotal event in 2022, launching tectonic changes in the political, economic and social life of Russia. Unprecedented sanctions imposed by Western countries and retaliatory measures by the Russian government have sharply worsened the investment climate, provoking an outflow of foreign companies from the country, a mutual freeze of assets and an accelerated reorientation of foreign trade flows.

Growing uncertainty about the results of the military conflict and the timing of its end, which persisted throughout the year, exacerbated the problem of intra-elite and public consensus in Russia. Partial mobilization caused not only changes in public sentiment, but also became a significant factor influencing the economy (triggering the outflow of specialists, a decrease in consumption, etc.).

Infrastructural risks in the financial and technology sectors, attempts to avoid international isolation and keeping the economy from a sharp decline have become key challenges for the Russian government in 2022. The delayed and accumulated effect of sanctions, the growing budget deficit and risks for the Russian ruble create the framework of trends that will manifest themselves as early as in 2023.

Kesarev presents an overview of the most significant events of 2022 and the trends they set.