Russia Running Out of Money, Could Lose Ability to Fund War: Top Economist

Russia is running out of money and could lose its ability to continue funding its war with Ukraine, according to a top economist.

The country's National Wealth Fund has been steadily contributing to the war effort, however Swedish economist Anders Åslund believes that the fund's liquid reserves could be depleted by the fall, Åslund wrote in an op-ed published by Project Syndicate.

While the fund had about $117 billion in it in 2021, it is now estimated to only have about $31 billion, according to Åslund.

This comes as Russia's exports have slowed and as many countries refuse to lend the country money. As a response, Russia was forced to raise taxes from their previous flat 13% to a progressive income tax ranging from 15% to 22%, and additionally raise corporate taxes from 20% to 25%.

Inflation has also been a big concern among Russians, and rising interest rates have worried business leaders about the rising risk of bankruptcy. Russian President Vladimir Putin previously acknowledged that "inflation" and "a certain overheating of the economy" were problems, but insisted that the government would be able to bring it down, the Financial Times reported in December.

Despite these issues, Russia plans to spend about $130.5 billion on defense this year, Business Insider reported last month.

"As the risk of a financial crash rises, Russia's imperiled economy is about to pose serious constraints on Putin's war," Åslund wrote in the op-ed.

Originally published by Latin Times.