Russia

The prolonged conflict in Ukraine, whose resolution is not in sight, will have the biggest impact on the Russian economy in 2023. But there is also no willingness to acknowledge the horrifying failure of Putin's expedition. This means Russia, which spent about 5 trillion rubles which is approximately $ 78bln on the war this year, will need to finance this special military operation even more.

There are three primary causes of additional costs: firstly, the number of soldiers and officers involved in this war will rise — the compensation and insurance payments promised to them will amount to at least 1 trillion rubles. Second, in 2022, Russia employed tools and weapons made in the past in Ukraine. Previous budgets had considered the entire cost of the materials. It will need to create or buy a new kit in 2023, which could result in an increase in spending of 1.2–1.5 trillion rubles, which is$19–$23bln. Thirdly, additional costs will be needed to restore and guarantee a minimally acceptable level of living for the "new Russians" following the annexation of sizable Ukrainian territory. All of these might cost several hundred billion rubles.

As a result, the economic cost of the conflict and its related activities can be estimated to be between 7.0 and 7.5 trillion rubles ($ 108 and 115 billion), or 22 and 24 percent of budget spending, or 6% of GDP.