To the perhaps mutual chagrin of Vladimir Putin and Donald Trump, the Russian and US leaders’ chummy summit in Helsinki last month appears to have backfired. Instead of a thaw in ties with Washington, Russia is confronted by new US sanctions. Not only have US senators, apparently alarmed by Mr Trump’s deferential treatment of the Russian president, proposed stiff further measures to punish the Kremlin for its interference in American elections.
Moscow is also facing bans on imports of US technology following the poisoning of a former Russian spy and his daughter in the UK in March with a banned nerve agent. The sanctions amount to a tightening vice on Russia’s economy. The impact of US and EU measures imposed since Moscow’s 2014 annexation of Crimea may have been limited. Alexei Kudrin, a liberal ex-finance minister, estimates they have shrunk Russian gross domestic product by only half a percentage point a year. But they add pressure when growth is already stagnating.
Years of failure to diversify the economy away from reliance on energy and natural resource exports are coming home to roost. So, too, is lack of rule of law and protection for property rights. That is not only deterring foreign investment. It is encouraging predatory behaviour by officials towards local entrepreneurs. The new sanctions will further deprive Russia of western know-how and financing vital to modernise the economy.
The Kremlin is facing protests, meanwhile, over plans to raise the pension age and value added tax. Polls suggest Russians are tiring of Mr Putin’s insistence that they should put patriotism above economic interests. Russia’s hosting of the World Cup allowed citizens to glimpse the attractions of friendly international integration, instead of belligerent anti-westernism. Mr Putin’s popularity has fallen to its lowest level since before Crimea. It is unclear whether new US sanctions will enable Moscow’s propaganda machine to reassert Mr Putin’s image of Russia as a “besieged fortress”.