Thousands of participants from 130 countries want to visit the economic forum in St. Petersburg. But the big names in politics and business are missing. Even Russian “friends” hold back. Instead, the show reveals the costly consequences of war.
Just a few years ago, a who’s who of heads of state and government gathered at the International Economic Forum in St. Petersburg. In 2009, then-Chancellor Angela Merkel guest-starred with President Vladimir Putin on “Russian Davos”. Even the Russian annexation of Crimea in 2014 has not changed its appeal: in 2018, French President Emmanuel Macron and then-Japanese Prime Minister Shinzō Abe, both of whom have already been assassinated, stopped by in St Petersburg. The following year, Chinese head of state Xi Jinping did the honors.
Four years later, the Russian president is expected to spend the economic forum more or less alone for the second consecutive time: the best-known European guest is Hungarian Foreign Minister Peter Szijjarto. Like Prime Minister Viktor Orban, the friend of Trump and Putin is unfazed by the Russian attack on Ukraine. In recent months he has been a regular guest at exhibitions, fairs and other events in Russia.
Otherwise, EU and NATO countries are avoiding the Economic Forum like vampires avoiding sunlight. This doesn’t just apply to government officials: when the Financial Times reported in May that former Google boss Eric Schmidt was to give a speech in St. Petersburg, he couldn’t deny it. Kremlin spokesman Dmitry Peskov is probably not wrong when he says that some Western business people like to participate in the economic forum but would be “eaten alive” if they publicly admitted it.
Better to work from home than visit Russia
However, not only the west of St. Petersburg shines with absence. Forum organizers speak on their website of more than 17,000 participants from 130 countries. However, the big names of neutral or even allied states are missing: among other things, Putin’s supposed best friend, Xi Jinping, has decided not to travel to Russia. Lula da Silva, Brazil’s president critical of NATO, also canceled. As well as Kazakh head of state Kassym-Jomart Tokayev. Last year, he was by far the most important guest in St Petersburg, along with eastern Ukrainian separatists, Belarusian head of state Alexander Lukashenko and the Taliban.
The guest list of the “Russian Davos” is worrisome. The Financial Times reported in May that not a single prominent cabinet member had applied from abroad, even from countries Russia considers friends. A look at the official program confirms this: a total of eleven guests are taking part in the Russia-China grand panel. But only three of them come from the People’s Republic, one of them connects online.
The schedule for Brazil, Russia’s biggest trading partner in South America, is very similar: only three Brazilian guests participated in the nine-person discussion group, two of them from their home computers. Not even the United Arab Emirates, the official guest country at this year’s event, are sending their most important representatives to St. Petersburg.
Hundreds of thousands of workers are missing
The International Economic Forum makes clear how lonely the world has become around Vladimir Putin after his attack on Ukraine. And also how problematic the situation is for the Russian economy itself: the war is not mentioned by name in the program, but it is omnipresent.
For example, in the panel Return to Russia: the potential of compatriots for regional development. The description speaks of “significant internal challenges” that Russia must face. “Mainly demographic,” he says.
After nearly a year and a half of war, this shouldn’t come as a surprise to anyone in the Kremlin: last spring, an estimated 200,000 Russian soldiers were killed or wounded in the attack on Ukraine. In addition, an estimated 900,000 to 1.3 million, mostly young men, fled abroad for fear of conscription.
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Political scientist Alexander Libman of the Freie Universität Berlin had already warned in the winter on the NTV podcast “Learned Again” that this would hit the Russian economy much harder in the short term than Western sanctions. Young men, in particular, are often productive and contributing workers.
“Import Flood of Counterfeit Goods”
Russia urgently needs not only new soldiers, but also workers, financiers and investments. The program includes more than 140 events that provide an insight into the state of the Russian economy: For example, the organizers of the Petersburg Forum are very concerned about Russian films, which lack money and production partners from the West. “Many promising projects had to be interrupted because of this”, he says.
Parallel imports have also become an expensive problem. These were legalized after the war broke out so that Russian consumers could continue to buy products like the iPhone even after companies like Apple withdrew voluntarily. Since then, Russian dealers have been allowed to import the affected devices without the manufacturer’s permission if they can get them anywhere in the world.
However, the legalization of parallel imports appears to be proving to be a fatal mistake. The Petersburg program warns of a “surplus of imported counterfeit products” that could cost Russian consumers billions: “Illegal trade has spread unchecked and occupied the Russian market”.
Brain drain? intellectual gain!
But the voluntary withdrawal of many Western brands also opens up new possibilities, as another item in the program suggests. According to this, thousands of Russian companies could fill the gaps that appeared and grow in double digits in the future. The only condition? They must “get to the heart of consumers” with their products, as explained in St. Petersburg.
Despite the high losses in Ukraine and the fleeing workforce, they will not be lacking soon. The brain drain has long since turned into a “brain gain”, as the organizers of the economic forum announce in another agenda item. “Foreign investors and experts, especially from Europe, are waiting impatiently to invest in Russia or to be able to emigrate there. They not only recognize the economic potential, but also the social one: in Russia it is possible to preserve traditional family values and moral concepts.”
But the immigration process is still bureaucratic and complicated. Furthermore, many Russians would perceive migrants as a threat. “How can we change our perspective and see this as an opportunity?” asks the Petersburg program.
Vladimir Putin cannot ask other heads of state or government for advice. And the head of the Kremlin is also rare in his economic forum: Putin will only attend an event on Friday, his spokesman announced this morning. No other date is planned.
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