Russia is forming the legal basis for a full transition of the economy to a military-oriented economy. On 30 May, Russian President Vladimir Putin signed a decree that gives the government the power to appoint management companies at strategic enterprises, including the power to disenfranchise shareholders in the event of a failure to fulfil defence orders.
This is stated in a report by the Institute for the Study of War (ISW).
According to ISW analysts, the document applies to companies in the aircraft, shipbuilding and arms sectors. The Russian Ministry of Industry and Trade will be able to centrally manage them to fulfil government orders, especially under martial law.
“Putin is likely laying the legal groundwork for requisitioning the economy in the event of full martial law – and thus preparing the country for a prolonged war with Ukraine or a potential confrontation with NATO,” the ISW report says.
Analysts emphasise that these actions indicate that Moscow has no intention of conducting good-faith diplomatic negotiations. On the contrary, the Kremlin is trying to create a centrally controlled economic model that can function in the face of a protracted mobilisation campaign.
This step also implies direct interference with private property if companies do not perform tasks under the state defence order. Experts call this “de facto militarisation of the economy” under the guise of legislative support.
