Despite the recent reduction of the key interest rate from 21% to 20%, representatives of large state-owned businesses, particularly those close to Putin, are increasingly loudly complaining about financial losses caused by the strict monetary policy.
Rostec’s head, Sergey Chemezov, accused the Central Bank of reducing the profitability of enterprises, especially in the high-tech sector. According to him, the corporation was forced to halt the construction of three out of five planned "green" power plants, and the export of dual-use products is now at risk. Notably, the Russian Central Bank raised the rate to record levels in October 2024, while the factories in question were supposed to start operating back in 2022. Chemezov had also previously threatened to suspend supplies of air defense systems, aviation, and ships abroad due to the risk of bankruptcy of several defense enterprises.
Similar demands came from Finance Minister Anton Siluanov and Severstal’s head Alexey Mordashov. Rumors about the possible dismissal of the Central Bank’s head, Elvira Nabiullina, are actively circulating in the media and business circles. Potential successors include Petr Fradkov — head of Promsvyazbank and son of the former director of Russian foreign intelligence.
Sberbank’s head Herman Gref and VEB.RF’s director Igor Shuvalov, who long maintained loyalty to the Central Bank’s policy, have also joined the criticism.
The focus on the high key interest rate as a brake on economic development indicates attempts by Putin’s close circle to shift sole responsibility for the failure of import substitution and profit declines onto the Central Bank. The conflict between the financial regulator and the business elite reveals a systemic crisis in the Russian economy, aggravated by sanctions pressure and internal structural imbalances.
