Russia may run out of money in 2024, oligarchs say

London (CNN) Outspoken Russian oligarch Oleg Deripaska has said that Russia could find itself without money as soon as next year and that foreign investment is needed.

“There will be no money already next year, we need foreign investors,” he told an economic conference in Siberia on Thursday, according to comments carried by Russian state-owned news agency TASS.

The comments from the billionaire – who last year called for an end to Moscow’s war in Ukraine early in the conflict – contrasted with a more upbeat assessment of Russia’s economic fortunes by President Vladimir Putin last week. Putin praised the country’s economy for its resilience in the face of unprecedented Western sanctions imposed last year.

Russia’s economic output shrank 2.1% last year, according to preliminary government estimates. The contraction was more limited than many economists had initially predicted.

But cracks are starting to appear — Russia is cutting oil production this month — and Western sanctions could escalate further. Ultimately, Russia’s economic prospects depend on what happens in Ukraine.

Deripaska said that foreign investors, particularly from “friendly” countries, have an even bigger role to play. Whether they will come depends on whether Russia can create the right conditions and make its markets attractive, he was quoted as saying.

Since the February 2022 invasion, Western countries have announced more than 11,300 sanctions and frozen nearly $300 billion of Russia’s foreign reserves in a bid to starve Russia of funds.

But China has made the Kremlin an economic lifeline by buying Russian energy, replacing Western suppliers of machinery and base metals, among other products, and providing an alternative to the US dollar.

Even then, Moscow has a steep hill to climb to make up for the loss of revenue as a result of the sanctions, not least from exports. Data released on Friday showed EU imports from Russia fell by 51% between February and December last year. Block was one of the main trading partners For Russia, before the invasion of Ukraine, 38% of Russia’s exports in 2020 were going to the EU.

Russian government revenue fell 35% in January from a year earlier, while expenditures rose 59%, leaving a budget deficit of about 1,761 billion rubles ($23.3 billion).

Deripaska made his fortune in the aluminum business during the chaotic scramble for assets following the collapse of the Soviet Union. In 2018, he was sanctioned by the United States, which stated that the oligarch “does not dissociate itself from the Russian state.” Last year, he was charged with allegedly violating US sanctions.

Forbes estimates Deripaska’s current net worth to be less than $3 billion.

— Anna Chernova contributed reporting.

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