The Russian State Council discuss business development in the light of sanctions (photo: dpa)

Sanctions - Russia fends off damage to economy with deep spending cuts

The ongoing friction between Russia and the European Union is not good news for frontline states such as Finland which are taking a beating in the war of sanctions and counter sanctions. Finland feels vulnerable and fears it too could be a Kremlin target for military action. Meanwhile, Russia is feeling the pain of sanctions which is demonstrated by the deep cuts in its newly announced budget.

THE EUROPEAN UNION will not ease sanctions against Russia, German Chancellor Angela Merkel told Finnish Prime Minister Alexander Stubb.

This was difficult news for Finland whose dairy exports have been hit hard by Russia’s retaliation over the sanctions.

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Professor Stefan Hedlund
The main reason for concern about growth prospects lies in deep structural problems. The Russian economy has been slowing for several years now, making a mockery of President Vladimir Putin’s earlier demands for an annual growth of at least five per cent
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