MOSCOW, July 22. /ITAR-TASS/. Further escalation of the conflict in eastern Ukraine and western economic sanctions may cost Russians as much as one-fifth of their income, Russia's former finance minister, Alexei Kudrin, said Tuesday.
On July 17, the White House announced new sectoral sanctions against Russia, targeting some of the country’s largest energy corporations and banks as punishment for Moscow’s alleged reluctance to curb violence in Ukraine.
“I support the stance that Russia should avoid military intervention in eastern Ukraine,” Kudrin told ITAR-TASS. “This could cause uncontrolled risks in economic, military and political spheres.”
A new round of confrontation might boost military spending on both sides given that Russia’s military budget is ten times smaller than that of NATO member states, he said. Kudrin added that Russia's GDP might fall, driving people's incomes down.
The sectoral sanctions, targeting entire sectors of Russia's economy, would lead to economic slowdown throughout the year, he said. New sanctions in the energy and financial sectors could lead to negative growth rates, the ex-minister said.
Kudrin said the Russian leadership has chosen "the right way of the political resolution of the [Ukrainian] conflict," adding that further military confrontation would be difficult for Russia.