The author writes that Russia's economy has become well-insulated against sanctions. Moscow's foreign currency reserves are at an all-time high, and the falling value of the ruble has actually been a boon for Russia's state budget. Furthermore, Russia's sovereign debt levels only make up 17 percent of its GDP and are therefore manageable. Moscow has exploited the sanctions regime for political purposes and has protection due to the Kremlin's heavy domination of the economy. Capital flight from Russia has decreased markedly, and sanctioned Russian oligarchs merely draw closer to the Kremlin. Even the unpopular pension reform plan has been blamed on Western sanctions. While Russia could "be vulnerable to restrictions on critical imports of advanced technology and equipment," Moscow is betting that the West will not cut off the exportation of hydrocarbons and other raw materials from Russia, as it would harm Europe greatly.

Read the full article at Foreign Policy.

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