Upon the Kremlin's invasion of Ukraine in February 2022, the west comprising of NATO, the European Union and its allies slapped Putin with thousands of economic sanctions. To date, Russia is the world's most sanctioned country. With more than 5,500 sanctions imposed against it, Russia had its fair share of retaliating too when it cut off Nordstream 2, the largest pipeline transmitting gas from Russia to Germany.
Many western companies like McDonalds, Starbucks, Coca-Cola, Estee Lauder, Clinique, Zara, Tommy Hilfiger, Mango and Levis to name a few, set up shop in the 1990s amidst the ruins of the Soviet Union. These businesses among many others curtailed and terminated operations in the wake of the invasion in condemnation of Russian aggression. Whilst the withdrawal of these businesses pinched the Russian economy, it did not kill it. Businesses like Italy's unicredit and Austria's Raiffeisen Bank are not only continuing operations in Russia but are also assisting the war effort. The haphazard and impulsive nature in which sanctions were imposed last year and even in 2014 during the Russian invasion of Crimea, not only failed to pierce the Russian economy but backfired on European economies when Putin decided to retaliate by severing Russia's gas supply to Europe. There was also a lack of clarity and confusion surrounding the objectives of the sanctions. What was the west aiming at when they imposed sanctions against exporting software technology, transportation equipment, aviation and space technology and energy technology/services to Russia. Further sanctions imposed bans on the import of crude oil, refined petroleum products, coal, steel, gold and building materials from Russia. Given the inextricably linked economies of Russia and the European Union, The EU banned highly sought after commercial services; from June 2022, auditing, accounting, tax and management consulting have been prohibited. Further in October 2022, the EU widened the net of prohibited services to IT and legal consultancy, market research and engineering services among others.
package of sanctions, sanctioned against the purchase, import/transfer of crude oil and petroleum products to the EU, (Which in fact punctured the European economy more than it did Russia's ). The above description only encompasses a brief overview of the economic sanctions placed on the Kremlin.
The world saw failure from the moment the west professed a vague declaration that the sanctions were to weaken the war effort. No amount of sanctions ever had the potential to halt Putin's invasion, while he had a resilient war chest. When Russia was sanctioned, it was predicted that the economy would collapse 7-8% in a year, when in reality statistics reflected only a 2.5% decline. Throughout 2022, Russia maintained trade relations with countries like China and Belgium exporting oil, gas and coal and still holding fast to ties with OPEC (Organization of Petroleum Exporting Countries). Russia's export income has risen by more than 40% because of higher prices- and the simple fact that Europe is still heavily dependent on natural gas.
Essentially, the reason why the economic sanctions placed against Russia have failed to deliver a heavy blow to the economy, is that Russia has found avenues to circumvent the sanctions. For example, in order to counter the energy export sanctions, Russia has augmented its shipments to Asia (albeit not serving as a full substitute for its export capacity to Europe).
Conclusively, Russia will continue to survive and defy most western sanctions: even if Russia increases its defense budget to 5% of its GDP, Russia will still have sufficient resources to fund the war effort.