Local industrial associations report a dramatic decline in investments, profits, orders, and production in a region traditionally supporting Russia's war industry.
Local industrialists in a region crucial to Russia's military sector report a severe economic downturn, with investment and production plummeting over the past year. This area, home to around 3 million people and approximately 500 kilometers from Moscow, has historically played a vital role in the country's war production, but recent reports suggest significant financial distress.
The local industries are facing over 100 billion rubles in unpaid debts, with a critical risk of 20,000 layoffs looming if business conditions do not improve. Companies are particularly frustrated with delays in payments from major state corporations such as the United Shipbuilding Corporation, Roscosmos, Rosatom, and Rostec, which have exacerbated fiscal challenges for local producers. The lack of subsidized loans has forced businesses to seek commercial loans with interest rates exceeding 20%, further straining their financial positions.
The deepening economic crisis in this region can be attributed to rising interest rates and a general decline in the economy. Large companies have already started reducing working hours, reflecting the pressure they are under. If the situation does not change by the second half of the year, it is projected that thousands will lose their jobs, marking a significant consequence of Russia's ongoing military endeavors and the economic repercussions of international sanctions.
