Putin’s Draft Scares Away his Own Citizens, Hurts National Economy

Russia’s borders are looking looser than a runny borscht. As Vladimir Putin continues his woebegone war in Ukraine, Russian civilians are leaving in droves, with many fleeing to nearby countries and wealthier citizens seeking the island life far from the…

Griffin Kelly
(Photo credit: Social Income/Unspalsh)
Sign up for insightful business news.

Russia’s borders are looking looser than a runny borscht.

As Vladimir Putin continues his woebegone war in Ukraine, Russian civilians are leaving in droves, with many fleeing to nearby countries and wealthier citizens seeking the island life far from the front lines, Bloomberg reported. The exodus is taking a toll on the national economy.

Techie Defectie

Putin’s invasion has been met with at best mixed support at home. Most didn’t expect Ukraine to fight hard, and when it did, the morale of Russian forces plunged. In September, Putin announced a mobilization of 300,000 reserves, and since then, more than 700,000 military-age men have allegedly fled the country, according to Forbes Russia. Border crossings are often jammed for miles, with many abandoning their cars and taking whatever they can carry.

Russia’s tech industry is seeing significant departures. A recent survey found that 25% of IT workers were considering leaving the country and 6% had already done so this year. In February, the California-based rideshare startup inDrive had 1,200 employees in Moscow and the Siberian city of Yakutsk. “We’ll have zero by the end of the year,” CEO Arsen Tomsky told the WSJ. Workers are leaving for neighboring nations like Turkey, Georgia, and Kazakhstan. The Russian border rush is hurting the economy as well as Putin’s war efforts:

  • Tech represented just under 6% of Russia’s GDP, but was one of the fastest-growing parts of the economy before the war, according to economists at Bryansk State Technical University. Tech offered fairly high-paying jobs and connected Russian employees with Western companies.
  • Because of all the departures, the tax burden is rising for those who remain. The Russian central bank said at the end of October that the economy would contract between 3% and 3.5% this year, which would be the deepest recession of any large economy in the world this year.

Life’s a Beach: More well-off citizens are looking to take indefinite leave in the Caribbean via investment initiatives – programs that grant citizenship in exchange for significant funding to the society, culture, or the economy. From there, people can move freely to other places like the US, China, and the UK. Fleeing Russians could make up the biggest chunk of applicants to the small island nation of Grenada, where the minimum investment is $150,000, Bloomberg reported. With its warm weather and beautiful beaches, Grenada isn’t such a bad place to ride out a war.

Analysis more

Extra Credit: The Shifting World of Private Credit Markets

Tale of the Tape: Warren Buffett and Cathie Wood

Recent News

UK Opens Antitrust Investigation into Apple and Google

China Warns It Will Tightly Regulate Covid-Linked IPOs

Investors Are Slowing Their Home-Buying Spree

Virgin Yanks Support For Heathrow Runway

[subscribe-form listid="1ebbb697aaa44fb1971fe0a3c42ff841" source="organic" medium="organic" redirect-url=""]
<form action="" class="subscribe-form "> <input type="text" name="subscribe_form_email" placeholder="Enter your email"> <input type="text" name="subscribe_form_name" placeholder="Enter your name" value="" class="c-subscribe-from_field"> <button class="c-btn" id="subscribe-form-submit" type="submit">Subscribe</button> <div class="subscribe-form-message"></div> <div class="subscribe-form-vars"> <input type="hidden" class="subscribe-form-param" name="params[listid]" value="1ebbb697aaa44fb1971fe0a3c42ff841"> <input type="hidden" class="subscribe-form-param" name="params[source]" value="organic"> <input type="hidden" class="subscribe-form-param" name="params[medium]" value="organic"> <input type="hidden" class="subscribe-form-param" name="params[redirect_url]" value=""> </div> </form>