Economic considerations could prove the main factor in forcing Russia’s foreign and domestic policy to gradually normalize and evolve toward greater caution and responsibility, writes Vladimir Ryzhkov. The annexation of] Crimea will cost Russia one percentage point in economic growth, or 360 billion rubles ($9 billion) in unpaid wages and accelerated inflation due to the weakening ruble. In fact, Crimea will contribute about three percentage points to inflation this year…. Although the Russian people continue celebrating the annexation of Crimea and giving the authorities sky-high ratings, the first signs of trouble are now appearing…. As Russia’s Crimean-Ukrainian project incurs an increasingly heavy expense, the economy itself will provide an unerring litmus test of the soundness of Kremlin strategy.

The current hidden costs of the annexation of Crimea are hitting the oil and gas industries mostt prominently.  Meetings in China suggest that looking East is Putin’s best bet, as cash from the oligarchs and other big Russian businesses exit the country.