Ukraine crisis impacting Russian economy

By Abraham Shanedling

 

The World Bank has indicated that Russia’s economy could drop by 1.8 percent if the standoff in Ukraine continues and the resulting U.S. and European sanctions stay in place or intensify.

 

Although Russian leaders in the Kremlin have downplayed the impact of the sanctions, economists say that investors have pulled about $70 billion from Russia’s economy since the crisis began. Prices for food and imported items have already risen, and some Russians are reportedly having problems tapping into funds at banks designated by U.S. and European sanctions.

 

Russia’s already weak economy plus the threat of more sanctions even prompted Standard an Poor’s rating agency to change its rating of the situation from “stable” to “negative.”

Voice of America has more on the story.