Russia’s Economy Is Threatened by War and Sanctions

But the loss of investment, technology and skills caused by the sanctions is likely to echo across generations, depriving many Russians of a chance at a better economic future, experts said.

In 2009, when Volkswagen launched full production cycles in Kaluga, Mr. Volodin not only got a job, but also unexpected support.

“I got paid to get trained for my job,” he said, still impressed. When a robot replaced him, he was retrained.

Those were boom times for Kaluga, an industrial region about 120 miles south of Moscow. The former governor actively courted Western investors, learning English and building a modern airport with several flights a week to Germany. He transformed a regional economy that had been 80 percent oriented toward the Soviet military industrial complex into one connected with the West. Pharmaceutical companies flocked to the Kaluga region, which has a population of one million, and so did auto manufacturers.

Volkswagen hired about 4,200 workers. Volvo and Stellantis, which produced and sold the Peugeot, Citroёn, Opel, Jeep and Fiat brands in Russia, also established operations in the region. An ecosystem of suppliers and related industries sprang up to serve them, employing at least 25,000 people, according to Dmitri Trudovoy, the chairman of the independent Workers’ Association trade union. Courses in German and other foreign languages at the local university were a pipeline to an office job with the companies.

Article source: https://www.nytimes.com/2022/12/05/world/europe/ukraine-war-sanctions-russia-economy.html