Putin’s decision
In a surprising move, Russian President Vladimir Putin has nominated Deputy Prime Minister Andrei Belousov as the new Minister of Defense on May 12th, replacing Sergei Shoigu. This marks the most significant change in the Russian military leadership since the outbreak of the Ukraine conflict in 2022.
Belousov, formerly the Minister of Economic Development, has been one of Russia’s most influential economic advisors over the past decade. He shares a close relationship with President Putin and a common vision with the Kremlin’s head for rebuilding a powerful nation.
He has also played a pivotal role in overseeing Russia’s unmanned aerial vehicle program.
Who is Andrei Belousov?
Andrei Belousov was born on March 17, 1959, in Moscow, Belousov pursued economics at Moscow State University, graduating with honors in 1981.
From 1981 to 2006, he was a researcher at the Central Institute for Mathematical Economics of the USSR Academy of Sciences, later known as the Institute of Economic Forecasting of the Russian Academy of Sciences.
In 2006, he was appointed Deputy Minister of Economic Development and Trade.
In 2008, Belousov became the director of the financial and economic department of the Russian government.
From 2012 to 2013, he served as the Minister of Economic Development. From 2013 to 2020, he was an assistant to the Russian President on economic issues.
In 2020, Belousov was appointed First Deputy Prime Minister of Russia, a position he holds to this date.
As Deputy Prime Minister, Belousov is responsible for shaping the main directions for Russia’s socio-economic development, coordinating efforts to achieve national development goals, and completing national projects, including financial, credit, and monetary policy issues, and regulating the financial market.
Since 2022, Belousov has also overseen the development of high-tech transportation and intelligent control systems.
The Economic Aspect of Russia’s Ministry of Defense
Commenting on President Putin’s proposal to appoint economist Andrei Belousov as Minister of Defense, Kremlin spokesperson Dmitry Peskov emphasized the necessity of integrating the overall economy of the security sector, especially the defense ministry, into the national economy.
“Aligning the economy of the security sector with the current economic dynamics is extremely important,” Peskov stressed.
Peskov also stated that Belousov is the best candidate to address the economic challenges currently faced by the Russian military.
Appointing an economist as Minister of Defense is deemed appropriate as Russia approaches a situation reminiscent of the Soviet Union in the 1980s, when military and executive spending accounted for 7.4% of the Gross Domestic Product (GDP). It is crucial to ensure that spending aligns with the country’s overall economy. Hence, President Putin desires an economist to lead the Ministry of Defense.
“The more open to innovation, the more likely to triumph on the battlefield,” Peskov said.
According to Peskov, Belousov’s appointment will not alter the “coordinate system” of the military division within the Ministry of Defense.
“In terms of the military component, this appointment will not change the current coordinate system; the military component has always been the prerogative of the Chief of the General Staff, who will continue his activities without any anticipated changes in this regard,” Peskov explained.
To date, Russian economists have largely ensured economic stability and growth despite the harshest sanctions ever applied to a major economy, although the failures of the Russian military were exposed soon after the invasion.
“The proposal to appoint one of the court’s chief economists and a key state minister in the economic bloc as the head of the Ministry of Defense could mean that Putin is planning to win the battle with defense industrial plants and the international market,” said Alexander Baunov, a former Russian diplomat and now a senior fellow at the Carnegie Center for Russia and Eurasia.
“The strategy for victory in this case would not be mobilization and breakthrough, but rather a slow pressure on Ukraine with the superior strength of the Russian military-industrial complex and the entire economy,” Baunov added.
Mark Galeotti, Director of the London-based consultancy Mayak Intelligence, believes that the role of the defense minister in Russia during the conflict is to ensure the military has everything it needs.
“In that context, having an economist who has spoken about the need to manage the economy in line with the demands of the defense sector will certainly make sense. Essentially, this is a job that a financial manager and economist like Belousov can do,” Galeotti assessed.
