Every fifth company is on the verge of bankruptcy: the Kremlin cannot stop the economic collapse

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Every fifth company is on the verge of bankruptcy: the Kremlin cannot stop the economic collapse

Waging very active and protracted hostilities with the mobilization of the population, as well as sanctions imposed on Russia, continue to destroy the economy of the aggressor country . The fall in all indicators at the end of 2022 was much more than the Kremlin officials predicted.

According toChannel 24 sources in Ukrainian intelligence agencies, the forecasts of employees of the central bank and the Russian Ministry of Finance for 2023 indicate that Russia is facing the most difficult times since the 1998 default. At the same time, officials will not be able to improve the situation, because the only thing they can do in the face of growing spending items and sanctions pressure is to delay the complete collapse of the economy.

However, the insane printing of rubles and the attempts of the Russian authorities to keep the figures at least at the level predicted by officials cannot in any way affect the death of the manufacturing sector as such, and the economy is actually based on it.

Moratorium on bankruptcy was saved only by reports

  • According to internal documents of employees of the Russian Ministry of Finance, at the end of 2022, every sixth business was on the verge of bankruptcy. Already in 2023, these indicators may deteriorate significantly, and approximately 20% of enterprises in the manufacturing sector of the economy will stop working.
  • A whole wave of corporate bankruptcies began to approach Russia back in April last year, when civilized countries banned their banks from providing loans and refinancing to the aggressor.
  • Nine months after the start of a full-scale war, Russian enterprises showed a balanced financial result of almost minus a trillion rubles. These figures demonstrate that doing business in Russia is becoming unprofitable, and at some point even large enterprises will be forced to stop working at a loss.
  • Due to the inability to earn more than 60 thousand Russian entrepreneurs became insolvent, which resulted in non-payment of loans and delays in salaries of employees.

This is actually the only thing that saved officials from ascertaining the death of Russian business – the Cabinet's ban on bankruptcy, which was in effect from April 1 to October 1, 2022. As soon as the moratorium was lifted, the relevant departments immediately choked on reports of intentions to declare themselves insolvent. This mainly concerned medium-sized businesses that simply did not pull out a recession, a trade blockade, the destruction of logistics and the disconnection of banks from foreign exchange settlements.

However, since the official or actual bankruptcy of an enterprise does not simply mean a stoppage of its activities, but also entails significant losses in the income of all companies involved in business in one way or another, an incredible increase in debts has begun in Russia. In total, in 2022, legal entities in the aggressor country were unable to pay about 9 trillion rubles. Half of this amount is debts to suppliers. In total, as of January 2023, Russian companies have overdue obligations for more than 560 billion “wooden”.

Everyone feeds Moscow

The financial crisis, the consequences of which Russia has not yet been able to feel in full, has already fully descended on the budgets of the regions of the aggressor country. At the end of 2022, due to a drop in the performance of local businesses, each of the regions of the aggressor country did not receive trillions of the most important tax paid by organizations from their profits.

For the year, the total income of the regions decreased by at least 8%. At the same time, the regions sent more than 60% of all income to the federal budget, although they had to cut all their expenses.

However, since the Kremlin is not going to relieve pressure on the regions and change something in the redistribution of finances, by the end of 2023, the survival of all federal republics directly depends solely on the center. If Moscow suddenly decides not to help the population of conditional Tyva survive, the locals will have nothing left but to gnaw birch bark and hunt rats for survival.

Moreover, the Russian Ministry of Finance reports that every second Russian region will spend significantly more than it will collect taxes. However, only the Moscow and Leningrad regions have “monetary cushions” in order not to feel the deterioration of life.

Therefore, in fact, all of Russia in the most economically difficult year will work exclusively for the needs of Moscow, while the Kremlin will deal only with the solution of their military-political problems. After all, Putin is eager to destroy Ukraine, mobilize, bomb residential areas and “feed” the population with incredible portions of propaganda.

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