Is the COVID-19 pandemic Putin’s Chernobyl moment?

How quickly things may change. On 10 March 2020, the Russian Duma voted overwhelmingly in favour of a constitutional amendment paving the way for President Vladimir Putin to seek a fifth presidential term in 2024. Two months later, he is faced with a crisis which may eventually render any talk of his re-election meaningless. At the root of the crisis is the COVID-19 pandemic – truly a black swan for which few were prepared – and this challenge has been exacerbated by the closed and power-preserving nature of the Putinist regime.

The pandemic hit Russian politics at a relatively late stage. The country’s main news programme – the 9pm news on state-controlled Channel One – on 10 March contained no references to the COVID-19 pandemic within Russia. Instead it celebrated the Duma vote on the constitutional amendment, largely believed to be a piece of political theatre prepared in the Kremlin, and it showed images of Italy under lock-down. Two weeks later, on 24 March, Putin visited a leading hospital in the Moscow suburb of Kommunarka treating COVID-19 patients, and on the same day Sergey Sobyanin, the Moscow mayor acting as coordinator of the national response to the pandemic, openly told Putin that “the true picture … no one in the world knows”. This indicated a shift in tone, and on the following day Putin announced a non-working week, telling people to stay at home while still receiving their full salaries. Russia then had 658 confirmed cases.

Uncertainty of data

The non-working week was extended to a full non-working-month of April and on 28 April Putin announced a further extension. In his televised address to the Russian people, Putin warned his viewers that “we face a new, and perhaps the most intense, stage in the fight against this epidemic”, and he admitted that there was a shortage of personal protective equipment (PPE) for medical staff and that preparations by the authorities in general could and should have been better. This coincided with viral news that medical staff at the hospital in Kommunarka were resigning in relatively large numbers because of a shortage of PPE and problems with the payment of salaries. The official record then said 93,558 confirmed cases – more than in both China and Iran – and 864 casualties.

According to official Russian data, by late April the daily increase in confirmed cases is measured in single digit percentages. This has led the Kremlin spokesman Dmitriy Peshkov to predict that the curve may flatten already in mid-May. New prognoses commissioned by the (Putin-critical) news outlet Meduza suggest that the curve may indeed flatten in Moscow in mid-May, while it may take some additional weeks for the rest of the country to reach this level.

All data is surrounded by a high degree of uncertainty. To provide just one example, the ratio between confirmed cases and deaths is approximately 100:1, that is, one per cent. All the other states with 50,000+ recorded cases have higher fatality numbers: This ranges from 2.6 per cent in Turkey and 3.9 per cent in Germany to 13.5 per cent in Italy and 14.0 per cent in France. There is of course, as in all states, a substantial dark figure of contagion not covered by official registration.

In the case of Russia, this could for instance be a result of deliberate under-reporting (at local, regional and federal levels) and poor testing (no testing or a relatively high number of false negatives). The Moscow city authorities on 27 April reported a 70 per cent spike over the course of one week in the number of patients hospitalized with the common flu. The comparatively low number of casualties led Russian investigative journalist Roman Dobrokhotov to ask sarcastically whether this is caused by the fact that Russians “simply do not live until old age?”.

Recession - again

Speaking to directors from the Russian car industry on 24 April, Putin made it clear to them that the present situation is “more difficult than the situation in 2008-2009”. The 2008 crisis led to a 7.8 per cent decline in Russian Gross Domestic Product (GDP) in 2009. The 2014 crisis, by comparison, caused a 2.3 per cent fall in GDP in 2015, and the Russian economy is still recovering from that shock. Income levels in late 2019 remained 7 per cent below the levels enjoyed before the 2014 crisis. Opinion polls have shown a persistent sense of crisis among Russians since then. In January 2015, 62 per cent of Russians reported that they felt a crisis situation in the country and that number has not since been lower. According to the Russian Federal State Statistics Service, 20.9 million Russians live in poverty.

When measured in terms of both suddenness and sheer destructive force, the most recent equivalent to the COVID-19 pandemic may be the 1986 Chernobyl disaster

The Russian Central Bank predicts a decline in Russian GDP in 2020 of 4-6 per cent, former Minister of Finance Aleksei Kudrin forsees a decline of 8 per cent and former Deputy Minister for Economic Development Aleksei Vedev warns that it could go as high (or low) as a 10 per cent decline. Whatever the differences in these forecasts, they all point in the direction of a systemic blow to the Russian economy. This is caused mainly by the COVID-19 pandemic, but an additional factor is the sudden collapse in oil prices. Russian oil (Urals) in April 2020 fell to a low of USD 8.48 per barrel, the lowest level since December 1998, that is, even before Putin’s first presidential term.

Adding to the seriousness of the situation is the vulnerability of the Russian economy. The country’s National Welfare Fund on 1 April 2020 held USD 165 bn, equaling 11.3 per cent of GDP. Current COVID-19 stimulus packages amount to some 5 per cent of GDP. However, so Kudrin argues, more is needed to offset more of the consequences of the recession. One challenge is that, once emptied, the National Welfare Fund will be much slower to fill up as oil prices are low and well below the break-even price of USD 42.4. Putin has failed to lead in the reforming of the Russian economy when both time and money were in greater supply than now – and he failed to do so partly for political reasons: if the regime gave up some of its economic control, it risked losing some of its political control.

A black swan inside the Kremlin walls

A black swan has landed inside the Kremlin walls. This has happened before. When measured in terms of both suddenness and sheer destructive force, the most recent equivalent to the COVID-19 pandemic may be the 1986 Chernobyl disaster. Dissimilar in nature, these two incidents may nonetheless share important characteristics.

The Chernobyl disaster led to a definitive loss of trust and confidence on part of the Soviet people in the communist regime. Soviet leaders could not be trusted to report negative news truthfully and accurately – especially not when doing so could undermine their own power. And they were seen as incapable of reforming the stagnant Soviet economy and bring the wanted improvements in living standards to the Soviet people.

The COVID-19 pandemic has similar disruptive potential. News from Russia indicate a growing suspicion that the official reporting on the pandemic is marked by underreporting and cover-ups. The regime has successfully managed to put a lid on other unwelcome news – for instance casualties in war – but the pandemic affects the entire country and is more difficult to contain. Moreover, the combination of a current economic crisis and a deep, approaching recession is likely to provide the necessary impetus for structural reforms. The status quo will be unacceptable. Once changes are introduced, it may become apparent that an inherent discrepancy exits between the new system and the old regime. The latter will have to go.

On 30 April, Russia recorded a total of more than 100,000 confirmed cases and more than 1,000 deaths.