The Crimean economy is “no better than Palestine”, Russian Regional Development Minister Igor Slyunyayev has claimed.
“The peninsula is not self-sufficient when it comes to the entire group of vitally important resources — first of all, electricity and water,” Mr. Slyunayev said.
“About 80 percent of water comes to its territory through the northern Crimean canal from the Dnieper River. Also, 80 percent of Crimea depends on imports of electricity.”
The Palestinian economy is hugely dependent on aid from the international community, as well as a line of credit from the State of Israel.
The Associated Press reports:
“As part of Ukraine, about 40 percent of Crimea’s annual budget of roughly $500 million was propped up by subsidies from Kiev. Russia would be expected to at least match — and probably far exceed — the Ukrainian annual contribution to raise living standards in its new territory.”
But Nataliya Orlova, chief economist at Alfa Bank said, “For Russia’s budget this is not a big deal… Even if you spend $5 billion or $10 billion, this is not money that dramatically changes things.”
The New York Times noted: “Fully absorbing Crimea is a potentially herculean undertaking, which would require issuing new passports, changing the currency to rubles from Ukrainian hryvnias, and integrating completely distinct systems for property records, taxes, legal disputes and more.”
“There is no overland transportation link between Russia and Crimea, and building a bridge across the shortest waterway, near the Crimean city of Kerch, would take years and cost an estimated $3 billion to $5 billion.”