Top Russian economist replaced after warning of economic costs of Ukraine war

Andrey Klepach, a prominent Russian economist, has been removed from his position as chief economist at Russia's national development bank, VEB, following a speech in which he alleged that the war in Ukraine was causing damage to the Russian economy. The official confirmation of his departure was made by Russia's state news agency, TASS, without providing a specific reason for his dismissal.

A replacement for Klepach is expected to be appointed soon, according to TASS. This move comes just two days after The Moscow Times, an independent Russian newspaper, published excerpts from Klepach's speech, delivered in May at the Nikitsky Club, a gathering of economists and academics. In his address, Klepach cautioned that Russia was losing ground in both technological and economic competition on a global scale and would not emerge victorious in an attrition war, as Ukraine was supported financially by Western nations.

He further warned that a social crisis was imminent. The economist's comments, along with his subsequent departure, shed light on the internal dissent towards President Vladimir Putin and the consequences faced by those who voice their concerns. Klepach highlighted that Russia's conflict in Ukraine has surpassed the duration of the Great Patriotic War, the Soviet Union's fight against Nazi Germany, with no foreseeable end in sight.

Additionally, he pointed out that ongoing Ukrainian attacks on Russian infrastructure, coupled with Western sanctions and rapidly rising domestic interest rates, are collectively impeding Russia's economic expansion. Since May, when Klepach initially presented his concerns, Ukraine has ramped up its aerial assaults against Russian infrastructure, seemingly aiming to inflict the war's repercussions on the Russian populace and push the country's business leaders to advocate for an end to the hostilities.