Economists expected a collapse. In April 2022 the World Bank forecast an 11.2 percent decline for Russia, and the Russian economy ministry had pencilled in a contraction of more than 12 percent. The actual figure for 2022, reported by the statistics service Rosstat, was 2.1 percent.
That gap is the starting point for any honest account of what Western sanctions have done. The World Bank had called them “the largest coordinated economic sanctions ever imposed on a country” and warned of “a deep recession looming in 2022.” Against this backdrop, Al Jazeera reported, the economy proved sturdier than anyone had predicted. Agriculture, construction and mining grew. Public administration and “military security” gained 4.1 percent, and heavier military spending cushioned the fall in industrial output.
Growth with strings attached
The rebound came fast. By the third quarter of 2023 the economy was 5.5% larger than a year earlier, the Moscow Times reported. Russia’s central bank looked for full-year growth of 2.2% to 2.7%, and Economy Minister Maxim Reshetnikov said 3%.
Independent analysts saw strain behind the numbers. Military outlays had propped up activity but created imbalances, and the paper quoted the diagnosis that “inflation has surged and unemployment is at record lows, leading to labor shortages.” To cool prices the central bank lifted its interest rate to 15%. The ruble hovered around 90 to the dollar, held up by currency controls.
Trade shifted too. Moscow sent more of its oil and gas to China and India after Western buyers pulled back.
The frozen reserves
The financial front is where the argument now sits. According to a 2025 explainer from Duke University’s Lawfire blog, about $300 billion in Russian central bank assets sits frozen abroad. Nearly $200 billion of it is held at Euroclear in Belgium, roughly $21 billion in France and $5 billion in the United States.
In May 2024 the European Union approved spending the interest those assets earn on Ukraine’s military and reconstruction. Taking the principal is a harder question. Belgian Prime Minister Bart De Wever warned that seizure would be “an act of war.” Congress passed the REPO Act in 2024, which lets a president confiscate Russian sovereign assets located in the United States, yet neither the Biden nor the Trump administration has used it. Moscow has threatened retaliation against about 1,800 Western companies still operating in Russia.
Duke professor Bruce W. Jentleson put the broader record bluntly: sanctions, even when they impose economic costs, “haven’t necessarily led to political success.”
Sources
- Russian economy shrank 2.1% in 2022, much less than expected (Al Jazeera)
- Russian Economy Expands for Second Quarter Running (The Moscow Times)
- Seizing Russian Reserves, Explained (Duke University Lawfire, Maggie McGinnis)
