Why there can be no return to business as usual with Russia

Russia’s war against Ukraine: where do we stand?

The conference began with a strategic assessment of devel­op­ments in Russia’s war against Ukraine.

It is difficult to judge whether we are at the beginning, in the middle or approaching the end of the war. In any case, there can be no return to the status quo ante in relations with Russia. It is an illusion to believe that the war can be ended by a compre­hensive peace agreement that paves the way for a new partnership with Russia. For Moscow, this war is not just about Ukraine, but about the entire European order – and this struggle may only just have begun.

The situation on the battle­field is unsat­is­factory for Russia. Even after three and a half years, it has not achieved its goals: the summer offensive of 2025 turned out to be more of an infor­mation offensive – Russian troops made little progress on the ground. There is greater momentum on both sides in the air war. Kyiv is increasing the cost for Moscow – for example, through air strikes on Russian fuel depots – while Russia is exploiting weaknesses in Ukrainian defence systems with mass-produced drones.

The biggest mistake made by American and European supporters of Ukraine was to repeatedly allow Putin to overcome difficult situa­tions by giving him time to regroup. This hesitancy stems from the lack of a common strategy towards Russia and a common vision of the desired outcome of the war.

The Economy – How long can Moscow continue to fight?

The second panel, held in cooper­ation with the London-based think tank New Eurasian Strategy Centre, examined the state of the Russian economy, the regime’s stability and the mood in Russian society.

Following an initial brief period of turmoil caused by Western sanctions, the Russian economy has quickly developed resilience. The question of how sustainable this is and how long it will allow Putin to continue the war without resorting to more drastic political and economic measures – such as mobil­i­sation or the intro­duction of a war economy – was a key focus of the discussion. Speakers pointed out that Moscow is making more and more key economic data secret.

According to some partic­i­pants, the Russian economy has been in a kind of hangover mood for about a year following a boom driven by high military spending. It is still unclear how serious this actually is. Growth is slowing down; stagnation or even recession appear possible. Slowly, the economic situation is forcing the regime out of its comfort zone.

Although there is almost full employment and rising wages are making people optimistic, the labour shortage is becoming an increas­ingly acute problem. In addition, a differ­en­ti­ation is emerging in the labour market: war-related sectors are likely to continue to perform well, while incomes in other areas are likely to decline.

The economic situation poses risks for the state budget. The deficit is already well above expec­ta­tions. Revenues are falling – partly due to high military spending and lower revenues from oil and gas, which is not least attrib­utable to economic sanctions. If the war continues with the same intensity, an even larger budget deficit can be expected in 2026; rising inflation will likely be unavoidable. At present, predom­i­nantly volun­teers are being sent to the front, which is cost-intensive. The same applies to military spending. If the war continues or escalates, the economic situation could force the regime to switch to a war economy or to send conscripts to the front.

Others countered that for Putin, the war – despite its high cost – remains relatively constrained – both in terms of troops and of money. The economic hangover in Russia began several years ago, long before the war. Currently oil and gas revenues are falling and techno­logical decline is advancing. However, the economy is expected to continue to grow by around one per cent in the coming years. According to this analysis, Russia’s existing economic model allows the Kremlin to continue the war for another three to five years: despite the sanctions-induced techno­logical decline, Moscow can continue to produce weapons on a large scale – not high-tech, but suffi­cient for its warfare.

Politics: Will Putin’s successor be a ‘collective Putin’?

According to one analysis, the regime appears more stable and consol­i­dated polit­i­cally than before the war. However, Putin’s funda­mental problem is that his regime cannot reproduce itself: there is no new blood and much depends on his individual personnel decisions.

This analysis assumed that the Putin system is currently preparing for a transition of power; however, Putin’s ‘successor’ will not be a new person, but Putin himself – in the form of a new type of regime, the ‘collective Putin’. In this system, power remains concen­trated in Putin’s hands, while routine admin­is­tration is delegated.

The fact that this transition has already begun is evident from the increasing repression within the elites, which is also weakening the ruling clans. Putin has promoted his own aides and bodyguards to key positions. However, he does not expect them to be good managers, but rather to exercise political control over others. Power is thus increas­ingly concen­trated in the hands of a ‘president at large’, while the impor­tance of parliament and government – already weak and dependent – continues to decline. This transfer of power is expected to be completed by the 2030 presi­dential election.

However, two things could poten­tially be dangerous for the Kremlin during this transition: Firstly, the centre may not be able to react quickly to unforeseen events – as demon­strated by the weak response to the uprising led by mercenary leader Prigozhin. Secondly, the growing repression of the elites could lead to the formation of an opposition within the ruling elite in the long term, even if there are currently no signs of this.

Society: How sustainable is support for Putin?

Socially, too, the regime appears to have reached a peak in its stability. However, there are signs that this could slowly erode in the future.

On the one hand, there is discontent among the hardline militarists who actively supported the war. This group, which makes up 25 to 30 per cent of the population, is dissat­isfied with the course of the war and, conse­quently, with the regime, although they may support Putin as a national leader. In contrast to the largely demor­alised opponents of the war, the hardliners are relatively vocal – and are therefore increas­ingly becoming the target of political repression.

On the other hand, there are signs that the vast majority of Russians, who are conformists and passively support the war, may soon experience economic diffi­culties because the potential for economic redis­tri­b­ution has been exhausted.

Most people are still satisfied with the economic and social conse­quences of the war: this includes not only soldiers and their families. The economic and social status of indus­trial workers and technical specialists, who were severely underpaid and under­valued in the post-Soviet era, has also risen. What’s more, many people are satisfied with the reduction in the diversity of lifestyles. A majority has decided against moderni­sation and social progress, even if this means a certain decline in living standards.

At the same time, surveys show that expec­ta­tions for an improvement in the social and economic situation remain high: this could be the beginning of a phase of declining support for the regime.

Therefore, a protracted war is the best option for Putin, as Russian society has changed over the past three years and the degree of consol­i­dation is high. An end to the war could trigger unfavourable changes in social consciousness for him. Conse­quently, Putin could change the format of the war, but he is unlikely to end it.

What strategy?

The confer­ence’s closing session focused on key points of a new Russia strategy.

The experts agreed that compre­hensive economic and military support for Ukraine must be a central element of this strategy. It must be taken into account that the war of aggression against Ukraine is a symptom of a much larger problem that Russia repre­sents today. Putin’s primary goal is to re-organise the European continent and achieve a kind of ‘Finlan­di­s­ation’ of Europe. To this end, he is attempting to undermine Europe’s credi­bility and resolve, as well as NATO, in particular the alliance commitment laid down in Article 5.

The challenge posed by a revan­chist and neo-imperial Russia will continue after the end of the war against Ukraine, but the manner in which the war ends and the role Europe plays in it will have a signif­icant impact on the future of Ukraine, Russia itself and Europe.

Ukraine must survive this war as a sovereign and democ­ratic state, decide indepen­dently on its domestic and foreign policy, and be integrated polit­i­cally and militarily into the West. Achieving this will demand a great deal from Europe, but the costs of failure would be incom­pa­rably higher.

A defeat for Ukraine would have fatal conse­quences – not only for Ukraine itself. Russia would be encouraged to continue arming itself and provoking others. If the Kremlin were to emerge victo­rious, this would reinforce the imperial tendencies in the country. The regime would see this as confir­mation that its war of aggression is paying off and that the West is weak. Then Ukraine would not remain the only target of further aggression.

The question of when individual NATO member states are militarily threatened leads many to assume that Europe still has time. However, this fails to recognise that military force is only one of several means available to the Kremlin to achieve a new order in Europe. If Putin believes he can achieve this goal more quickly through hybrid warfare, he will use it consis­tently. We are already seeing how cyber­at­tacks, sabotage and disin­for­mation are increas­ingly becoming part of everyday life for people in Europe.

Europe will have to deal with the challenge posed by Russia for many years, if not decades – as long as the country does not undergo funda­mental systemic change and abandons its neo-imperi­alist policies and author­i­tarian tradi­tions. Until then, the problem cannot be solved, it can only be managed.

Against this backdrop, the lessons learned from the Cold War are instructive, despite historical differ­ences. The policy of containment towards the Soviet Union was remarkably effective without placing an excessive burden on the resources of the democ­ratic states. The Soviet Union was contained until it finally collapsed without any nuclear escalation. Under the circum­stances, a kind of new Cold War could be the best possible scenario for Europe. This would require a policy of containment and deter­rence that does not abandon the option of political change in Russia in the long term.