Sanctions against Russia and the Russian Economy in the Period 2014-2018

Abstract

The purpose of this article was to present sanctions applied to Russia by European Union countries, the United States, Canada, Switzerland and other countries after 2014 as a tool to discourage aggressive behaviour against Ukraine. In addition, an attempt was made to determine the impact of sanctions on Russia’s economy on the basis of Russia’s economic situation analysis. In the opinion of the author of the paper, economic sanctions against Russia have affected Russian economy. The Russian GDP declined, albeit at current prices in the US dollar, the pace of GDP growth was diminished, as well as a global demand, prices and interest rates have risen. There has also been an increase in inflation, the depreciation of ruble and decline in the size of foreign exchange reserves, as well as deterioration of the quality of Russian citizens life. Final conclusion of the paper is author’s conviction that introduction of economic sanctions against Russia and the isolation of Russia on the international stage has led to weakening of Russia’s economic development in the short term. However, over the longer term, the impact of sanctions on the Russian economy has been compensated by mobilization of internal economic growth factors. It is therefore possible to formulate a general conclusion that sanctions applied to small economies will be much severe than to large economies such as Russia.