Russian President Vladimir Putin appointed a civilian economist as the new defense minister on Sunday, signaling a strategic shift to bolster Russia’s economic approach to the ongoing conflict in Ukraine, according to a new report by Reuters and Kremlin press releases.
Andrei Belousov, 65, a former deputy prime minister with a specialization in economics, is set to replace Sergei Shoigu, 68, who has served as defense minister since 2012. Putin proposed that Shoigu take over as the secretary of Russia’s powerful Security Council, replacing Nikolai Patrushev, and also manage the military-industrial complex, according to the Kremlin.
Patrushev is expected to receive a new, yet unannounced, position. These changes, which are anticipated to be ratified by parliament, represent the most significant modifications to the military command structure since Putin initiated a large-scale military operation into Ukraine in February 2022.
Kremlin spokesman Dmitry Peskov explained that these changes are timely as Russia’s current situation mirrors the Soviet era of the mid-1980s when military and law enforcement spending was a significant part of the national GDP.
“The one who is more open to innovations is the one who will be victorious on the battlefield,” Peskov said, per Reuters.
Belousov, who is known for his close relationship with Putin and his prior role as economy minister, aligns with Putin’s vision of a robust state and has collaborated with leading technocrats to push for innovation. He has been instrumental in overseeing Russia’s drone program. This reorganization within the elite circles of Russian politics indicates Putin’s intensified commitment to leveraging the nation’s economic resources in the conflict against Ukraine, especially after Western sanctions attempted unsuccessfully to destabilize Russia’s economy.
Despite these sanctions, which are among the toughest ever imposed on a major economy, Russian economists have managed to maintain economic stability and growth. Alexander Baunov, a former Russian diplomat and now a senior fellow at the Carnegie Russia Eurasia Center, suggested that Putin’s strategy appears to focus on utilizing the defense industry and international markets rather than direct military mobilizations. “The winning strategy in this case will not be mobilizations and breakthroughs, but slow pressure on Ukraine with the superior power of the Russian military-industrial complex and the economy as a whole, which, apparently, is supposed to be made to work more effectively for the front and rear,” Baunov said.
This move by Putin also maintains the balance within the complex system of personal loyalties that define the current Russian political landscape. It positions Shoigu in a role that is technically senior to his previous post, thereby preserving his dignity and continuity within the administration. Valery Gerasimov, the chief of Russia’s General Staff and a key figure in directing the war, will retain his position.
Shoigu faced significant criticism from Russian military bloggers for the military’s setbacks in 2022 and an unsuccessful mutiny attempt by Yevgeny Prigozhin, leader of the Wagner mercenary group and a vocal critic of Shoigu, who later died in a plane crash. Shoigu and Prigozhin were noted for their personal hostility and starkly contrasting approaches to power: The cautious, institution-oriented Shoigu made for a natural foil for the risk-prone ex-convict, restaurateur and mercenary warlord Prigozhin, whose feared Wagner group recruited heavily from Russia’s prison population and gestured at rather edgy political affinities.
Prigozhin and Shoigu had been longstanding competitors for Putin’s ear, and the President of the Russian Federation seemed to encourage their rivalry. Shoigu seemed to emerge as the most direct beneficiary of Prigozhin’s failed coup attempt, enjoying more power and influence than ever before after his greatest adversary was killed in August.
Mark Galeotti, director of the London-based Mayak Intelligence consultancy, commented on the reassignment, noting the appropriateness of having an economist manage the war-time economy.
“In that context, having an economist, someone who has been speaking about the need to basically subordinate much of the economy to the needs of the defence sector, makes a certain amount of sense. It is now essentially a financial administrator’s job and Belousov can do that,” Galeotti told Reuters.
Following these changes, Putin left Alexander Bortnikov and Sergei Naryshkin, the heads of the Federal Security Service (FSB) and the Foreign Intelligence Service (SVR), in their respective positions. Sergei Lavrov, the veteran foreign minister, will also continue in his role, as confirmed by the Kremlin.
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Author: Nicholas Dolinger
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