Latvia’s State Security Service (SAB) has revealed internal calculations from Russian state institutions: despite Moscow’s loud public claims of “successful adaptation,” internal assessments acknowledge that sanctions have already caused and continue to cause massive damage to the economy.
Between 2022 and 2025 alone, Russia was forced to spend an additional $130 billion — about $32.5 billion annually — to bypass sanctions and purchase banned Western goods, which it previously bought much more cheaply directly from the West. According to internal forecasts of Russian institutes, losses from Western restrictions will reach at least another $136 billion by 2030. The total reduction in foreign trade due to combined risks could amount to $175.5 billion.
Latvian intelligence emphasizes that these figures are significantly underestimated and overly optimistic. The real impact of sanctions, including indirect consequences — rising logistics costs, declining corporate profitability, loss of budget revenues, and structural problems — may be several times higher. In the energy sector alone, potential losses over five years are estimated at $216.5 billion, if the EU imposes a full embargo and China, India, and Turkey reduce purchases of Russian oil and gas.
Exports of key goods have already shown a catastrophic collapse. Iron ore has fallen by 40% (from 28 million tons in 2021 to significantly lower volumes). Ferrous metals are down 20%. Chemical products are down 35%. Wood and cellulose have been hit the hardest — down 50%. Russian analysts themselves admit that restoring these markets within the next five years will not be possible, despite propaganda claims.
A particularly severe blow has come from the complete breakdown of trade with the EU, which cost Russia about $70 billion. Secondary Western sanctions are making Russia a “toxic” partner even for Global South countries: China, India, and Turkey are increasingly reluctant to take risks and avoid large-scale trade reorientation.
SAB states directly that sanctions effectively limit Moscow’s financial and technological capabilities, undermining its ability to fund the war in Ukraine and rearmament. The Kremlin continues its aggressive policy because its internal system and propaganda do not allow it to acknowledge reality. Any easing of sanctions would only accelerate Russia’s remilitarization and strengthen support for anti-Western regimes.
