Russian State Development Bank Fires Chief Economist After War-of-Attrition Warning

In August 2026, VEB.RF – Russia’s state-owned development corporation – terminated the employment of its chief economist, Andrei Klepach. The action followed the circulation of excerpts from a May 2024 presentation in which Klepach warned that Russia could not sustain a prolonged economic confrontation with the West and Ukraine. Sources cited by the independent outlet *The Bell* said the dismissal was ordered “from above” and linked directly to those remarks. VEB.RF has not provided an official explanation.

Kyiv Independent

Klepach had served as VEB.RF’s chief economist for 12 years, after a decade at the Ministry of Economic Development. At a May meeting of the Moscow Exchange’s Nikitsky Club, he warned that Russia was “falling behind” China, the United States and, in some respects, Ukraine, and that the war’s costs were mounting and could trigger a social crisis. His assessment contradicted President Vladimir Putin’s public claims that the Russian economy was weathering sanctions.

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• The Guardian reported that Russia’s budget deficit reached 5.87 trillion roubles in the first four months of 2026, far above the government’s 3.79 trillion-rouble target for the entire year.

The Guardian

• UNN cited Ukraine’s Foreign Intelligence Service, noting the deficit rose to 6.46 trillion roubles in the first seven months of 2026, with an additional 724 billion roubles added in July.

Economist of Russia’s state-owned bank admits Russia’s defeat in a war of attrition with the West

• Oil and gas revenues in the first half of 2026 were 64 % of their 2024 level, according to CNBC analysis.

Russia’s Wartime Economy Shows Deepening Strain

VEB.RF declined to comment on the termination. *The Bell* reported that it had requested a response from the bank but received none. Two sources familiar with the matter confirmed that the firing was connected to Klepach’s May remarks and that VEB.RF head Igor Shuvalov acted on a higher-level directive. No Kremlin spokesperson offered a public statement on the dismissal.

Kyiv Independent

Sources differ on the scale of the fiscal shortfall. The Guardian’s figure of 5.87 trillion roubles for the first four months contrasts with UNN’s report of a 6.46 trillion-rouble deficit after seven months. Both numbers indicate a deficit far exceeding the annual target, but the precise magnitude remains unclear.

Economist of Russia’s state-owned bank admits Russia’s defeat in a war of attrition with the West

Klepach’s dismissal underscores the Kremlin’s intolerance for internal dissent on economic policy, even among senior technocrats. The budget shortfalls, declining oil-gas revenues, and mounting war costs raise questions about Russia’s ability to finance its military operations without further fiscal strain. Analysts cited by CNBC note that while headline GDP growth appears modestly positive, the underlying two-tier economy leaves many households vulnerable, potentially influencing future policy choices.

Economist of Russia’s state-owned bank admits Russia’s defeat in a war of attrition with the West

No official timetable for policy adjustments has been announced. Observers will watch for further statements from VEB.RF, the Ministry of Finance, and Kremlin officials regarding fiscal strategy, as well as any additional economic assessments from senior economists within the Russian system.

CNBC