The occupiers widely advertised the Kerch Bridge they opened in Ma y2018 as a symbol of political, administrative and economic “unification” with Russia. The problem is that the peninsula’s economy will not be rescued by such projects — its biggest troubles are caused primarily by Moscow’s policy, not infrastructure issues or international sanctions.
The developments in Crimea after 2014 show that the occupiers are returning it into the 18-19th centuries when it was nothing more than a southern military outpost of the empire.
This is bad news for the Crimeans – anything that does not serve Russia’s military or administrative needs will inevitably stagnate and gradually decline. Nothing short of external interference will be able to change this.
The great depression
The occupational authorities are not trying to conceal Crimea’s economic dependence. According to their data, Crimea’s 2017-2018 budget has a deficit of RUB 2bn [current exchange rate is RUB67.18 per US dollar] with there venues amounting toRUB 172.2bn and spending toRUB 174.7bn. The actual shortage may be far higher: Vitaliy Nakhlupin, the “first vice-premier” of Crimea, has said that the deficit of the 2017-2018 budget exceeds RUB 20bn. The major source of this is the economic isolation resulting from the sanctions, shunned by investors. Just two weeks ago, American Best Western Hotels & Resorts closed down in Crimea – this was the last Western hotel chain operating there. According to current data, some companies, such as Volkswagen, Adidas, PumaandDHL,still work there as the EU sanctions only concern some sectors of the economy. But this does not change the overall result dramatically. Russian statistics estimated total foreign investment in Crimea at 7.2% in 2014, 3.3% in 2015, 3.4% in 2016 and 1.2% in 2017.
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