People walk past a currency exchange office in central Moscow on Feb. 28. Russia’s central bank has more than doubled its key interest rate to 20 per cent, and the ruble has plunged 30 per cent against the U.S. dollar since the start of the war on Feb. 24.ALEXANDER NEMENOV/AFP/Getty Images
Milena has spent most of the past week frantically glued to the messaging platform Telegram responding to texts from friends and family back in Moscow, all trying to determine if they should stay or leave amid the rapidly devolving economic situation in Russia.
“My dad called me from Moscow, panicking, saying he had to send me all his money immediately and to save it, not spend it. He said everything is over,” said the 20-year-old political science student at King’s College in London.
Her father is a lawyer in Moscow, and she grew up there before completing her final high-school years in London, a common schooling trajectory for upper-middle-class and wealthy Russians. (The Globe is not using their last name over safety concerns.)
Milena is vehemently anti-Putin. When the war began, she successfully helped organize transportation to get her mother’s relatives out of the northeastern Ukrainian city of Kharkiv, which has since come under heavy bombardment from Russian forces.
Still, she has been shocked by the speed and scope of Western sanctions against Russia. “In my circle, people are angry and feel betrayed by the President. We are now going to go through a big economic depression. I don’t think Russia will be the same,” she told The Globe and Mail.
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Many of Moscow’s rich and Westernized elite have found themselves at a critical juncture, evaluating if they can ride out the looming economic catastrophe amid an unparalleled exodus of hundreds of multinational brands and companies. In the past 10 days alone, more than 300 companies have withdrawn in some form from Russia, including consumer staples such as Nike, McDonald’s, Starbucks, Zara, Netflix and IKEA. Russia’s central bank has more than doubled its key interest rate to 20 per cent, and the ruble has plunged 30 per cent against the U.S. dollar since the start of the war on Feb. 24.
Malls and grocery stores are emptying out in the capital’s rich neighbourhoods, according to multiple London-based Russians with family in Moscow. And while the majority of Russians have been cut off from Western media and most forms of social media, richer business owners and the professional class have been able to employ the use of virtual private network (VPN) connections to access outside information, allowing them to understand the true scale of the invasion – and the conviction behind the West’s sanctions against Russia.
“Highly skilled professionals in bigger cities with a higher level of consumption who have gotten used to Netflix, Spotify, Amazon … they have been affected the most. I’m not talking about the oligarchs,” said Valentina Feklyunina, a professor of Russian politics at Newcastle University. “The longer this plays out, the more the average person will be affected – those working in manual-labour jobs, those who make goods.”
Marta, a close friend of Milena who also grew up in Moscow but left to pursue higher education in Britain, said it has become extremely difficult to get money for things such as school fees and rent from her father in Russia. “People are flying from Moscow with cash now, helping other families, even though you can’t bring more than $10,000 at a time. There are other ways, like crypto, but it is complicated,” she said. The Globe and Mail is identifying her solely by her first name because she fears reprisals against her family back in Russia.
Marta says she finds Russia’s actions in Ukraine appalling. At the same time, she fails to see the need for sanctions. Her father, a businessman in Moscow who has been greatly encumbered by the sanctions and declining value of the ruble, is also debating whether to temporarily leave the city.
“The fact that all these brands will go away … it won’t stop the war. Most people who don’t have family in the West or access to Western media will continue supporting Putin. And that is the majority of people in Russia,” she said.
Marta and Milena have no memory of the Soviet Union apart from conversations with their parents and grandparents. Nor do they embrace Russian nationalism – at least not enough to buy into the Kremlin propaganda that was commonplace in schools and on television. They grew up “Westernized,” said Marta, with the privilege of frequent international travel, luxury clothes and brands and endless time on social media. “I love Russia, of course, and I want to be able to go back, visit my father and friends and do the things I always do there. I’m not sure if that’s going to happen,” she added.
Nikolai Petrov, a Moscow native and Russia expert at the London-based think tank Chatham House, told The Globe he believes the decisions by companies to pull out of Russia will be counterproductive because they only put pressure on opponents of Russian President Vladimir Putin and his war.
“I am doubtful that the sanctions will lead to a change in public opinion against Putin,” he said, adding that they could backfire and convince the average Russian that the West is responsible for the sudden economic crisis, not Mr. Putin’s decision to invade Ukraine.
“Almost all independent channels are cut off. It is only a minority of people who are very publicly and actively against the war. They are loud. A majority of Russians believe that Russia started this operation to denazify Ukraine,” he said.
Milena’s boyfriend, 26-year-old Yuri, a student at Bayes Business School at the City University of London, said that in a recent conversation with his grandmother, who lives in Siberia, he was scolded for not supporting Mr. Putin. “I was, like, ‘Grandma, what are you watching? Why do you think this?’ The brainwashing is very real.” Yuri, too, is being identified only by his first name because he fears reprisals against his family for speaking to Western media.
He is a member of Moscow’s rich and left the country after years of working at a state-owned logistics company. His parents and three younger siblings are still in Moscow and increasingly anxious about continuing to live there.
“It’s not black or white, you know? I have pro-Putin family members, I have politically apathetic family members, and I myself am against the war. I fear sanctions will eventually get us all, and everything Russia has become in the last 30 years will be gone.”
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