Russian oil? Under European embargo. The coal ? The same. Gold too. The banks ? Excluded from the Swift system, the main axis of communication of financial orders. Not to mention the many companies which, like McDonald’s, have decided to withdraw from Russia themselves since the war in Ukraine. And yet. According to some French-speaking media, Russian billionaires would pass through Western sanctions.
Last week, several daily newspapers thus reported a certain opulence among the richest in Russia. “Despite the sanctions, the Russian billionaires got rich”, could one read here and there. The information comes from an estimate of the Russian edition of the American magazine Forbes, published on April 22. And reading these media coverage, it seems to give reason to Putin’s rhetoric: “we don’t need the West”, “our economy will not suffer”.
What is it really ? As Putin himself recently admitted, Russia is not hermetic. If the figure put forward by Forbes, may imply that the sanctions would not have had an effect, this is not the case. The fortune of Russian billionaires has increased by 152 billion euros, compared to 2022, according to the magazine’s count. But this remains well below its pre-war level of around 100 billion, despite the gains estimated by Forbes.
Also, if the oligarchy again sees its income grow according to Forbes, not everyone is in the same boat. According to the February 2023 edition of Bloomberg Billionaires Index, another recognized estimate on the matter, 20 of the 23 Russian billionaires who could claim the world’s top 500 have seen their fortunes decline since February 24, 2022, the date of the Russian invasion of Ukraine. In total, according to this calculation, Russian multi-billionaires would have lost 67 billion in one year. A drop of 20%, which does not take into account the other 70 Russian billionaires whose fortune does not allow them to reach the rank of the 500 richest personalities in the world.
Few long term effects
Thus, it is mostly newcomers to the world of the Russian super-rich who are doing the best, as well as lesser-known fortunes… According to ForbesRussia officially has 110 billionaires, 22 more than in 2022. In addition, five billionaires preferred to renounce their Russian citizenship, rather than undergo European and American sanctions.
The rankings of Forbes and Bloomberg agree that the Western measures have had important short-term effects, but little over the long term. “The collective net worth of Russian billionaires bottomed out just weeks after the invasion, dropping $92 billion on March 9, 2022,” says Bloomberg. On his side, Forbes had estimated for his part that the total heritage of this caste had been halved in April 2022, compared to 2021.
Still, in the opinion of most experts, the sanctions seem to be hitting the Russian financial elite less hard than expected. How to explain it? A few weeks before the war in Ukraine, some oligarchs transferred part of their funds to their families, thus avoiding the freezing of registered assets, for example. This would be the case of Roman Abramovich, according to bank statements consulted by the Guardian.
Also, the fortunes have adapted and have put in place strategies to maintain their income. Like, don’t declare. Or sell. An example, Roman Abramovich sold most of his London property and the Chelsea football club, in particular. Finally, Russia has approached states that do not sanction it, such as China, Turkey, or the United Arab Emirates.