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🇦🇺 Australia /Economy & Trade

Russian bank fires economist who warned of losing 'war of attrition'

From ABC Australia · () English

Translated from English, summarized and contextualized by DistantNews.

At a glance

News Named sources Context piece
  • Russian state development bank VEB fired chief economist Andrei Klepach over remarks about the war in Ukraine.
  • Klepach stated Russia was losing economic and technological competition to the West and China, and also Ukraine, due to Western financial support.
  • He warned of mounting costs and potential social crisis, a rare public critique from a senior figure at a state institution.

Andrei Klepach, chief economist at Russia's state development bank VEB, has been fired following remarks he made in May about the country's economic standing and the war in Ukraine. Two sources familiar with the matter confirmed the dismissal to Reuters.

We are falling behind. We are losing both the technological and economic competition in the world. And we are losing it not only to China and the United States, in some ways we are losing it to Ukraine too.

— Andrei KlepachRemarks made at a financial forum in May, reported later in Russian media.

Klepach, a prominent Russian macroeconomist, stated at a financial forum that Russia was falling behind in both technological and economic competition globally, not just to China and the United States, but also, in some ways, to Ukraine. He attributed this to Western financial support for Kyiv.

"We will not win the competition in this war of attrition. We have the illusion that everything there [in Ukraine] will collapse. It has not collapsed and will not collapse. Our costs are mounting," Klepach reportedly said. His speech, published by the Nikitsky Club, also predicted a social crisis, marking a rare public criticism from a senior official at a state institution regarding the costs of the conflict Moscow launched in 2022.

We will not win the competition in this war of attrition. We have the illusion that everything there [in Ukraine] will collapse. It has not collapsed and will not collapse. Our costs are mounting.

— Andrei KlepachRemarks made at a financial forum in May, reported later in Russian media.

VEB confirmed Klepach's departure but did not provide a reason. Klepach, who joined the bank in 2014, also confirmed his dismissal. He had previously held roles at economic institutions and spent a decade at the economy ministry.

Economically we will not collapse, but our lag will continue to grow, with all the resulting consequences.

— Andrei KlepachSpeech predicting a social crisis.

In his speech, Klepach acknowledged Russia's resilience to Western sanctions but highlighted mounting pressures from Ukrainian strikes on energy and logistics infrastructure. He pointed to rising income inequality and slower GDP growth compared to the U.S. and Ukraine. The Russian central bank had previously suggested the economy might not grow at all this year. Ukrainian attacks on Russian oil refineries and warehouses have also created supply shocks, increasing inflation risks and public unease.

precisely when nobody is particularly expecting it

— Andrei KlepachDescribing the potential timing of a social crisis.
DistantNews Editorial

Originally published by ABC Australia in English. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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