Russian citizens brace for full force of economic sanctions: ‘People understand that they don’t have much time left’

ST. PETERSBURG, RUSSIA They’re preparing to replace the paper menus with electronic ones at Gastroli, a chic wine bar in central St. Petersburg.

Printing prices for food and drink is impractical when the costs of running a restaurant in Russia creep up every day.

The economic sanctions and export controls, the airspace closures making it impossible to plan shipments and deliveries, the steep drop in the value of the Russian currency.

You may not see it yet looking through the restaurant window up the street from Peter the Great’s Summer Palace, said manager Anton Aladin. Business is good and will continue to be, for another week. Maybe two.

But a harsh reality is setting in.

“Probably, people understand that they don’t have much time left. While there is still the possibility, while there is still a good price, people want to drink good wine and food for a good price,” Aladin said Thursday morning, ahead of the lunch rush. “It’s clear that our guests understand that things are going to be very bad.”

When Russian President Vladimir Putin began building up his troops on the Ukrainian border, military experts predicted that Ukraine would crumble and collapse against the force of one of the world’s most formidable armies.

Instead, the Ukrainians have held out longer than anyone expected, long enough for the weight of the world’s economic counterattack to begin exacting a toll on the Russian economy.

The Russian advance on Ukraine has sent multinational corporations racing for the exit, shelving their business plans and evacuating their employees in a mad scramble not to breach the financial-sector sanctions against Russian banks, companies and sectors of the country’s economy.

On Thursday, Swedish furniture giant Ikea shut its doors, as did clothing retailer H&M. Nike and Apple preceded them. The list of companies and organizations that have severed ties, suspended deliveries or decided to stop operating outright on Russian soil is over 100 names long and likely hasn’t finished growing yet.

Asked Thursday whether the main Zara store on Nevsky Prospekt, St. Petersburg’s main shopping thoroughfare, would be open the following day, a store assistant gave the only certain answer: “It’s not clear.”

Catherine the Great and Empress Elizabeth of Russia — real names Ira and Diana — have been living day to day through the COVID-19 pandemic. They stroll the cobblestones in front of the Hermitage Museum in historical costumes and thickly painted faces, searching for tourists willing to pay 500 rubles ($6 Canadian) for a few snaps.

They were looking forward to Friday, when the QR-code restrictions for museum entry were to end, ushering in a new wave of tourists and business.

But the imposition of stunning sanctions intended to cripple the Russian economy and make life so difficult that Russians rise up against their president has dashed those hopes.

Ira suggests that the Chinese and visitors from the United Arab Emirates — two of the few countries that have not publicly rebuked or sanctioned Russia — might still be counted upon as a source of future tourists.

Diana puts on a brave face, but no amount of powder and paint can hide her concern.

“The economy will suffer. There will be people out of work and higher prices at the grocery store. Of course, it’s all very sad, but it will be a shared problem,” she said.

“In Canada, too, the groceries will be more expensive, don’t you think?”

It’s hard to know what to say, what to believe, how to respond to such concerns. Russians are a well-educated people but now forced to live with unanswerable questions.

Riku Jäppinen endured two years of COVID-related delays before arriving in Russia from Finland to study economics at St. Petersburg University. I have arrived in the city just three weeks ago. Now he is facing calls from family members urging him to return home.

The only thing that might make him join the large numbers of foreigners and expatriates flying out through the few routes still available to them is if the European Union decides to cut Sberbank off from the SWIFT financial messaging system, which would prevent him from accessing his cash .

His friend, who is also from Finland but declined to give his name, said he uses cryptocurrency and is unaffected by financial restrictions and bank sanctions. His own personal tipping point from him would come only if Russian authorities cut access to the internet, which would prevent him from managing his cash from him.

There is certainly precedent for such a drastic decision. In response to mass protests, Kazakhstani authorities restricted access to internet and telephone services in the country for five days earlier this year.

There are rumors afoot that Putin might declare martial law in the coming days, rumors so prevalent they were even put to Kremlin spokesman Dmitry Peskov, who denied any such plans.

“These are nothing but hoaxes published on social networks, which citizens send to one another,” he said, according to the Guardian. “One should be very careful about information and not fall victim to rumors and fakes.”

The Russian state Duma on Friday is set to pass a law that would penalize those found to be circulating fake information about the Russian military activities in Ukraine with up to 15 years in prison.

Back at the restaurant, Aladin said he reads all the news about the alarming activities taking place on the other side of Russia’s western borders. He said his grandmother de el lived just outside of Luhansk, a place that is emptied of young people, has few employment opportunities and many social problems.

Certainly not a territory that merits the wholesale sacrifice of the Russian economy.

“I don’t know any people who support it,” he said of the military incursion. “Of all the people I know, there’s not one.”

Diana defers questions of war and peace to the military minds.

In her mind, civilians should live a civil life. But over the last eight years, the fighting began between Russian-backed separatists in the Donbas and Ukrainian forces, she has seen scary sights.

“They pass us on the court square. People without ears, without hands,” she said. “It’s been going on for years, but I don’t think there was another way out. We all want peace, we all want to live, to travel, to be happy.”

Everyone wants these things, but peace and travel are proving to be difficult in Russia, and happiness may be the next casualty to Putin’s decision.

“It’s an economic crisis,” Diana said. “But listen, all our lives there have been crises. We’re ready.”