Kremlin expropriates thousands: Mariupol as a hub for Putin's profits!

Kremlin expropriates thousands: Mariupol as a hub for Putin's profits!

Russia's economy is facing profound challenges as a result of new sanctions imposed by Britain and the European Union. This illustrates the current situation, as a decision on additional EU sanctions is due this week. According to a report by fr.de Major companies, including a major mechanical engineering company, have already furloughed thousands of employees to address the impact of the sanctions. The SOC ACE investigation, published on May 14, also shows that Russian companies in Mariupol are involved in large-scale expropriations.

This investigation identified more than 1,000 Russian nationals and institutions involved in potential abuse and asset theft. Over 1,200 private companies have profited from corruption and provided services to Russian security forces, while more than 180 Russian-born companies have engaged in takeovers without owners' consent. Russian actors have seized control of thousands of Ukrainian companies and properties, often without adequate compensation.

Role of Mariupol and criminal practices

The city of Mariupol has established itself as a logistically important center for Russian military supplies and the illegal export of Ukrainian grain. These economic practices could constitute criminal activity and, in many cases, indicate potential war crimes. The investigation also shows that similar events are taking place in other Russian-occupied Ukrainian cities, significantly complicating the political and economic situation in the region.

The financial impact of this occupation is significant. A previous analysis by SOC ACE estimates that Russia invested around 2 trillion rubles (about $20 billion) in the occupied territories between 2022 and 2023, while tax revenue from these zones was about $1.2 billion in 2024. It is noteworthy that 80 percent of these revenues come from the Donetsk and Luhansk regions, but the investments coming from these areas are greatly overpriced compared to the actual tax revenues.

The effects of the sanctions

In the context of the sanctions, the EU has decided on a 16th package of measures, which includes export and import bans and the exclusion of Russian banks from the Swift system. The goals of these measures are primarily aimed at increasing pressure on President Vladimir Putin. Despite this clear political and economic isolation, the Russian economy shows short-term growth of around three percent, although this is not accompanied by an increase in prosperity among the population.

Current forecasts indicate economic growth of 1.35 percent this year, with stagnating development until 2029. At the same time, companies face a challenge in finding suitable workers. These difficulties are compounded by bottlenecks in electronic components and software. China has established itself as the main trading point for Western technologies.

In addition, financial sanctions pose a serious burden on the Russian economy. These sanctioning measures make it difficult to borrow funds on financial markets, leading to widespread price increases and inflation. In January 2025, inflation in Russia was 9.9 percent, after being 7.4 percent in the previous year. A decline in public spending in areas such as social welfare, education and health is expected as the military budget steadily increases amid ongoing conflict.

In summary, Russia's integration of the occupied territories and the associated tight political and economic situation bring with it a variety of challenges both domestically and internationally. The relationship with Europe is seen as unlikely to be stable, while current political talks, including possible negotiations between Donald Trump and Vladimir Putin, could jeopardize broader sanctions efforts, he said deutschlandfunk.de.