Andrei Klepach, chief economist at Russia’s state development corporation VEB.RF, has been fired after publicly warning that Russia cannot win its economic war against the West and predicting an impending social crisis reminiscent of the Soviet collapse.
The dismissal, first reported by independent outlet The Bell, came after excerpts from Klepach’s May speech at the Moscow Exchange’s Nikitsky Club circulated in Russian media on August 14. VEB.RF head Igor Shuvalov dismissed Klepach following an order “from above,” according to two sources familiar with the matter.
Economist Warned of ‘Almost Certain’ Social Crisis
In his remarks, Klepach stated that Russia would be unable to sustain a prolonged economic confrontation with the West while Ukraine continues to receive massive Western support. “We will not win the competition in this war of attrition,” he said. “We have this illusion that everything there will collapse. It has not collapsed, and it will not. Our costs are growing.”
Klepach warned that Ukrainian strikes on Russian energy infrastructure and ports had become a “noticeable macroeconomic barrier to growth.” He forecast economic growth of just 1-1.5% under current sanctions conditions and said Russia was “almost certain” to arrive at a social crisis, drawing parallels to the periods before the 1917 February Revolution and the 1991 Soviet collapse. “Economically, we will not collapse, but we will continue to fall further behind, with all the consequences that entails,” he added.
Key Voice in Russia’s State Apparatus Removed
VEB.RF holds the status of Russia’s “state development corporation” and finances major Kremlin national projects, making it one of the most important financial institutions in the country. Before his 12-year tenure as chief economist, Klepach spent a decade at Russia’s Ministry of Economic Development. His dismissal marks the removal of one of the most senior independent economic voices within the Russian state apparatus.
The Kyiv Independent reported that the firing drew sharp reactions from analysts. “Only propagandists on the government payroll could fail to see the problems in economic growth rates barely above zero, a two-speed industrial sector, and a decline in investment amid rising unproductive defense spending,” one commentator noted.
International Data Corroborates Warnings
Klepach’s warnings align with data from international organizations tracking Russia’s economic trajectory. The International Energy Agency reported that Russian oil export revenues fell to $13.76 billion in July, down $720 million year-on-year, while output dropped to 6.97 million barrels per day. The Kiel Institute’s June 2026 report found that Russia’s liquid sovereign wealth fund assets had fallen from 6.5% of GDP at the start of the war to just 1.8% in April 2026, while the federal budget deficit exceeded the government’s full-year target within the first three months.
Russia’s GDP grew just 0.6% in the first half of 2026, with the economy contracting 0.3% in the first quarter despite increased government spending. The Kremlin has so far declined to comment publicly on the dismissal, a silence that analysts say underscores the sensitivity of the economic warnings within the highest levels of government.
Sources: The Bell; Kyiv Independent; IEA Oil Market Report; Kiel Institute
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