For average Russians, Western sanctions over Ukraine war are starting to bite

MOSCOW — Viktoriya and Yevgeny Vinnikov had carefully planned a trip this month to Bulgaria, even traveling hundreds of miles to get a Covid-19 vaccine that would allow them to enter the European Union.

They had booked on the low-cost Hungarian airline Wizz Air and had booked into a comfortable hotel in the capital, Sofia, and the ancient southern city of Plovdiv.

Then came the penalties.

After Western countries, including European countries, closed their airspace, Russia retaliated, banning flights by airlines from 36 countries, including Hungary. As a result, the Vinnikovs’ vacation was canceled. The couple do not know when they will be able to travel abroad again.

“We used to go abroad at least twice a year,” said Ms Vinnikov, a 56-year-old estate agent, adding that the canceled trip was a gift from her husband for International Peace Day. woman on March 8.

Since Moscow’s invasion of Ukraine last month, the United States and Europe have launched a series of punitive sanctions against the Russian economy, including restrictions on Russia’s central bank and reduced access other major Russian banks to the dollar and other reserve currencies. Plans are also underway to separate some Russian lenders from the Swift global payments messaging system.

The impact has already started to be felt.

Long queues have formed at some banks as Russians rush to withdraw hard currency.


Photo:

Artyom Geodakyan/tass/Zuma Press

Long queues have formed at some banks as the ruble continues to fall and Russians rush to withdraw hard currency. Cinemas were forced to cancel the showing of American films, after American studios Disney,

Warner and Sony have halted film releases in Russia.

Netflix customers in Russia were unable to pay for their subscriptions with credit cards issued by some Russian banks, including Sberbank,

Russia’s largest bank and a target of US sanctions. The problem was quickly resolved, according to Netflix.

Some Russians shelved plans to buy a new home after mortgage interest rates more than doubled to 20%. Meanwhile, Russians have begun to stock up on commodities such as foreign medicines lest they become scarce or completely sold out in the weeks and months to come. About 55% of Russian drugs are imported, according to 2021 data from DSM Group, a Moscow-based marketing agency specializing in pharmaceutical market research.

Olga Sazonova, 60, a coach and psychologist in St Petersburg who offers what she describes as “body mindfulness tours” in Europe and beyond, was due to take a group of 12 to the Maldives in April. This trip has now been suspended and she is awaiting a refund of her deposit from the hotel.

Since Russia invaded Ukraine in late February, the United States and allied countries have imposed heavy sanctions on Russia. The WSJ’s Shelby Holliday explains how these sanctions affect everyone from President Vladimir Putin to ordinary Russian citizens. Photo: Pavel Golovkin/Associated Press

Real estate agent Tatyana Johnson said rising mortgage rates had crippled the plans of many of her clients who had planned to take out mortgages. At least two customers, who were preparing to buy second homes at an interest rate of 11% before the sanctions, abandoned their project.

“Of course it became unbearable,” she says.

Ms Johnson was also planning to fly to Serbia on February 26, two days after the imposition of the first round of sanctions. But flight bans have stalled those plans. Although her airfare was refunded, Ms Johnson lost her hotel advance payment.

“The sanctions were not justified” because they hurt ordinary people, Ms Johnson said.

Kremlin spokesman Dmitry Peskov told reporters on Wednesday that “the Russian economy has suffered a severe blow”, but he insisted that “we are still standing”.

Commuters at a Moscow metro station. The pain of Western sanctions will spread to a large part of the population in the coming months, according to an analyst.


Photo:

Mikhail Tereshchenko/Zuma Press

The Kremlin retaliated against Western sanctions, including banning loans by Russian residents to foreigners and ordering exporters to sell 80% of their foreign exchange earnings from exports. The government also said it would spend a trillion rubles, or about $9 billion, to buy shares in Russian companies.

Nevertheless, “the current situation is very difficult,” said Stepan Goncharov, an analyst at the Levada Center, an independent Russian pollster. “This will have long-term consequences. This will have an effect not only on the middle class, but also on the lower class, which is more numerous. They will also feel this change in their normal life.

Goncharov said the sanctions could have far-reaching national consequences because low-income Russians who will bear the brunt of the sanctions are Russian President Vladimir Putin’s central political base.

Young, tech-savvy Russians, who are more globally connected and widely opposed to the Kremlin’s military campaign, will also feel the pinch, Goncharov said, adding that the pain would spread to much of the population over the course of the year. of the next few months.

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“I think for the sanctions [people] will blame European countries and the United States,” Mr. Goncharov said. “But of course there will be a drop in the standard of living and for that the responsibility will be put on the government, because they could not make the economy self-efficient and defend the ordinary people, and of course part of that blame will also be placed on the president.

Thousands of Russians took to the streets in several cities last week to protest against the war. Authorities used violence to disperse them and have since detained nearly 6,900 people for participating in unauthorized protests, according to OVD-Info, an activist group that monitors police detentions. Russian authorities have since quickly cracked down on other spontaneous protests.

A post on the Twitter account of imprisoned opposition leader Alexei Navalny on Wednesday urged Russians around the world to protest authorities’ attempts to stifle opposition to the Kremlin’s aggression in Ukraine.

“We must, through gritted teeth and overcoming fear, come out and demand an end to the war. Each arrested person is to be replaced with two new arrivals,” the tweet read.

A closed Apple retailer in a shopping center in Omsk, Russia.


Photo:

ALEXEY MALGAVKO/REUTERS

Invasion of Ukraine by Russia

Write to Ann M. Simmons at [email protected]

Corrections & Amplifications
A post on imprisoned opposition leader Alexei Navalny’s Twitter account urged Russians to protest the Kremlin’s aggression in Ukraine. An earlier version of this article incorrectly referred to the opposition leader as Alexander Navalny. (Corrected March 2)

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