Misunderstanding of the Russian mind-set
David Cameron may have hailed the G20 meetings in Brisbane over the weekend as a success for the global economy. But in reality, the gathering of the world’s most powerful leaders will be remembered only for the abrupt departure of President Vladimir Putin.
The Russian leader had probably already decided before even arriving in Australia to take an early flight home and dispense with the pleasantries of the end-of-summit dinner. Mr Cameron’s warning that the Kremlin was at a “crossroads” with the West over its alleged intervention in Ukraine, along with Canadian prime minister Stephen Harper’s blunt message for Russia to get out of its neighbouring former client state, will more than likely have stiffened Mr Putin’s resolve to not back down an inch.
In fact, his glib response to these threats and warnings was to complain about a lack of sleep, suggesting that he is preparing to dig in over his support for pro-Russian separatists around Donetsk.
Certainly, if the objective is to make Mr Putin appear isolated on the world stage in order to make him less popular at home, it isn’t working and also shows a profound misunderstanding of the Russian mind-set. A nation that endured the bloodbath of Stalingrad and almost half a century of economic isolation following the end of the Second World War is unlikely to blink first in its current standoff with the West. Indeed, Mr Putin’s popularity ratings at home have never been higher.
The danger for the global economy is that the dispute between the West and Russia, which is now being widely described as a new Cold War, will act as a significant drag on growth for years to come. It is certainly unlikely that the measures agreed on by the G20 to boost global gross domestic product (GDP) by 2pc, or £1.25 trillion, by 2018 will be achievable for as long as a country the size of Russia - the world’s eighth largest economy - is kept out in the cold.
