The confiscated enterprises are sold to new owners, and the proceeds from the sale go to the treasury of the aggressor state.
The Kremlin has been actively confiscating private business assets in Russia to fill the state coffers and finance military spending. The total value of confiscated property since 2022 has reached 3.9 trillion rubles or $49.5 billion.
This was reported by Bloomberg.
According to estimates by lawyers from the Moscow firm Nektorov, Savelyev and Partners, the total value of confiscated assets has tripled over the past year.
The Russian authorities come up with various grounds for confiscation: problems with the privatization of the enterprise, accusations of corruption and even extremism, or simply “protection of public interests.”
The confiscated enterprises are sold to new owners, and the proceeds from the sale go to the treasury of the aggressor state, which is losing its fill due to falling oil prices and the strengthening of the ruble.
According to Andrei Yakovlev, an economist and fellow at Harvard University's Davis Center, confiscating property that is later resold serves two purposes: it creates a new source of revenue for the budget and “changes the business elite in such a way that its fate is tied to the survival of the regime.”
Analysts say the increased asset seizures may help shore up Russia's public finances but are weakening the economy's resilience and hollowing out the private sector that has helped the Kremlin weather sanctions and the turmoil of its full-scale invasion of Ukraine.
Let us recall that Russia’s oil economy has gone into decline due to sanctions, falling oil prices and the abnormal strengthening of the ruble.
