Andrei Klepach of VEB said Russia\u2019s economy was falling behind China, US and \u2018in some respects Ukraine\u2019<\/p>\n
The chief economist at Russia\u2019s second-largest bank has been fired after a series of critical comments about the state of the economy, including warnings that Moscow would not win a prolonged economic war with Ukraine.<\/p>\n
Andrei Klepach, who had served in the role at the state-controlled development bank VEB since 2014, was fired days after Russian media reported on a scathing speech he had delivered to fellow economists in May.<\/p>\n
In the remarks, first reported by the Moscow Times, Klepach said Russia was \u201cfalling behind\u201d China and the US economically, and \u201cin some respects, Ukraine\u201d.<\/p>\n
Klepach said pressures on Russia\u2019s economy due to the war would inevitably lead to a \u201csocial crisis\u201d that would erupt \u201cwhen no one particularly expects it\u201d.<\/p>\n
He also said expectations of an imminent Ukrainian economic collapse were misplaced and that a prolonged standoff with Ukraine would not lead to Russia\u2019s victory. \u201cWe will not win this competition in a war of attrition with Ukraine,\u201d Klepach said. \u201cWe have an illusion that everything will collapse there. It hasn\u2019t collapsed, and it won\u2019t. Our costs are growing.\u201d<\/p>\n
The comments were a rare acknowledgment from a senior Russian economist of the country\u2019s mounting economic struggles and directly contradicted Vladimir Putin\u2019s claims that Moscow was successfully weathering the economic pressures of the war and that Ukraine\u2019s economic exhaustion was only a matter of time.<\/p>\n
VEB did not offer a reason for Klepach\u2019s firing. An acquaintance of Klepach told the business outlet Vedomosti that his departure from the bank was \u201cconnected to his personal, harsh assessments of the country\u2019s economic and political development, which cannot possibly align with the corporation\u2019s position\u201d.<\/p>\n
The independent Russian outlet the Bell reported, citing sources, that Klepach was fired on orders from the Kremlin and that his dismissal was directly linked to his May address.<\/p>\n
Klepach\u2019s dismissal highlights the Kremlin\u2019s growing insistence on loyalty within Russia\u2019s upper ranks, amid reports that Putin has increasingly surrounded himself with officials reluctant to challenge his views.<\/p>\n
Alexandra Prokopenko, a former adviser to the Russian central bank and a fellow at the Carnegie Russia Eurasia Center, described Klepach as a respected economist who was unafraid to voice views that diverged from the official line.<\/p>\n
\u201cKlepach\u2019s dismissal \u2013 he is one of Russia\u2019s best macroeconomists \u2013 is unlikely to delay the looming crisis he has been warning about,\u201d Prokopenko said. She said Klepach\u2019s forecasts were \u201cbased on assessments of reality rather than a desire to please anyone\u201d and were often more pessimistic than the official figures.<\/p>\n
Russia\u2019s economy is facing its most difficult period since the start of Putin\u2019s full-scale invasion of Ukraine in 2022, strained by massive wartime spending, western sanctions and Ukraine\u2019s growing ability to strike at Moscow\u2019s oil and gas industry.<\/p>\n
In the first four months of 2026 alone, Russia\u2019s budget deficit hit 5.87tn roubles ($81bn), well above the government\u2019s 3.79tn-rouble target for the entire year. Some of Putin\u2019s closest advisers have privately warned him that the current level of wartime spending is becoming unsustainable, according to two sources with knowledge of the discussions.<\/p>\n
Recently, Ukrainian strikes have hit dozens of warehouses belonging to Wildberries, Russia\u2019s largest e-commerce retailer, destroying billions of dollars\u2019 worth of stock. The attacks have raised questions about the company\u2019s financial stability and dealt a severe blow to thousands of independent sellers who depend on the platform for their livelihoods.<\/p>\n