Reeves and Svantesson: Don’t believe Putin’s lies. Economic pressure is working

Politico Europe · Feb 27, 2026 · Collected from RSS

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News Financial Services UK Ukraine’s allies must double down — including with the EU’s promised €90bn loan, Britain and Sweden’s finance ministers write. Vladimir Putin wants to undermine international support for sanctions and portray Russia as strong. | Hector Retamal/AFP via Getty Images February 27, 2026 4:00 am CET Rachel Reeves is U.K. chancellor of the exchequer and Elisabeth Svantesson is Sweden’s minister of finance. Four years ago Russia illegally invaded Ukraine — striking at peace in Europe and undermining global security. Since then, Vladimir Putin’s propaganda machine has been working in overdrive to spread the false narrative of a strong Russian economy. It is now clear that the country is not performing as well as its official statistics suggest. A report commissioned by the Swedish government last year showed signs of mounting imbalances in the Russian economy, suggesting that key economic indicators such as inflation and real GDP growth were likely manipulated. Since then, we have had access to intelligence that confirms that the Russian government is deliberately lying to the world about the state of the Russian economy. This is the weakest Russia’s economy has been since the start of the war, and it is likely to get worse over the next year. Putin wants to undermine international support for sanctions and portray Russia as strong. Through inflated threats and by pointing to problems in other economies, he is trying to divert attention from the hardships faced by his own population as a result of his illegal war. Inflation caused by the Kremlin’s spending on the war in Ukraine now means Russian households are cutting back on food under the burden of rising costs. Four years into Russia’s illegal invasion, the resolve and courage of the Ukrainian people endures and our determination to defend peace and security remains unshakeable. We’ve been strongly targeting Russia’s energy revenues, which are down by a third since the latest sanctions on Rosneft and Lukoil were announced. It is also welcome that the EU has reached an agreement to ban Russian gas imports completely and the UK has committed to adopting a full maritime services ban on Russian Liquefied Natural Gas (LNG). Now it is important to continue to increase pressure on Russian oil exports. This is why we should move towards a comprehensive maritime services ban on all Russian exports of crude oil and refined products. Squeezing Russia’s remaining revenues will further deplete its ability to finance the war. We can already see that a large share of Russia’s National Wealth Fund – its financial buffer used to pay for everything from pensions to roads – has been drained to pay for the war. In fact, the Russian government has stopped drawing funds from it and is instead relying on banks to buy government bonds, adding to public debt. The remaining funds are not even sufficient to cover the projected budget deficit for 2025. We’ve been strongly targeting Russia’s energy revenues, which are down by a third since the latest sanctions on Rosneft and Lukoil were announced. | Getty Images The Russian economy is failing. Spending has increased while exports and earning have decreased. The National Wealth Fund is being drained while banks and ordinary Russians are being forced to finance the war. We estimate that Russia has lost over $450 billion due to international sanctions; the equivalent of four years of war funding. This does not mean the Russian economy is about to collapse, or that we can afford complacency. It means that data proves that pressure on Russia works and should be intensified. That’s why this week the U.K. announced the biggest sanctions package against Russia since the early months of the invasion in 2022, clamping down on Russian banks, its liquefied natural gas industry, and international suppliers involved in sustaining Russia’s war machine. As well as continuing our pressure on Russia’s economy, we must ensure that Ukraine has the financing it needs to fight back. We welcome the European Council’s agreement in December to provide Ukraine with a €90 billion loan. This is a vital step and this desperately needed support must reach Ukraine as soon as possible. Continued European unity is central to getting us closer to a just and lasting peace. Four years in to Russia’s illegal invasion, the resolve and courage of the Ukrainian people endures and our determination to defend peace and security remains unshakeable. | Sebastian Gollnow/picture alliance via Getty Images By strengthening Ukraine’s hand, it sends a clear signal to Putin that he cannot wait Ukraine out. We must not be intimidated by Putin’s bluster and we cannot let Russia dictate our actions. We should take every possible step to increase pressure on the Russian economy and strengthen the position of Ukraine. Only if we do so will Russia abandon its illegal war and engage meaningfully toward a just and lasting peace. The United Kingdom and Sweden stand united in our support for Ukraine.