Russia is facing more than 16,000 sanctions — so why hasn't its economy buckled?

As Vladimir Putin spoke to a crowd in early February attending the "Everything for Victory" forum in Tula, a city 180 kilometres south of Moscow, he joked that he wanted to give the sanction-imposing West a "well-known gesture," but wouldn't because there were "a lot of girls" in the audience, and implied it would be rude. 

Instead, the Russian president boasted about the country's economy, and its ability to ramp up its military industrial complex, in the face of unprecedented sanctions. 

"They predicted a recession, failure, collapse," he told the crowd, which included factory employees, on Feb. 2.

"The entire economy has demonstrated resilience." 

Putin doesn't need to campaign on the strength of Russia's finances — he's slated to be re-elected next week for his fifth term as president, because his serious challengers have been barred or prevented from running.

But he has happily pointed out that Russia's economy is expected to grow 2.6 per cent this year, outpacing the G7, according to the International Monetary Fund. 

Over the past two years, Russia's government has managed to steer through sanctions and limit inflation, while investing nearly a third of its budget in defence spending. 

It's also been able to increase trade with China and sell its oil to new markets, in part by using a shadow fleet of tankers to skirt a price cap that Western countries had hoped would reduce the country's war chest. 

"I think for the next 12 to 18 months, [Putin] has enough resources ... to continue to fulfil his war machine," said Alexandra Prokopenko, a former adviser with Russia's Central Bank.

Prokopenko is now based in Berlin, having left her job and the country in the initial days of its full-scale invasion of Ukraine, which began in February 2022. 

"There is a big debate here in Europe: What was done wrong, and what else can we do to fine-tune the sanction regime?"

After Russia launched its invasion, the ruble tumbled and Western countries blocked transactions with its central bank, freezing $300 billion US in sovereign assets. 

Additional sanctions have been introduced in the subsequent years: more than 16,000 since Feb. 24, 2022, according to U.S.-based Castellum.AI. Some impact the economy more than others — over 11,000 of them are aimed at individuals, and about 4,600 at entities including financial institutions. A few hundreds others are directed at ships and aircraft. 

European airspace also closed to Russian planes, and hundreds of Western companies pulled out of Russia or curtailed their operations there.