How Russia’s Sinking Economy Could Provoke Unrest on Its Doorstep

Russia is saying "do svidaniya" to its immigrants, and that could be very bad news for its neighbors.

Russian ultra-nationalists shout slogans during the so-called "Russian March" in the southeastern outskirts of Moscow on November 4, 2013. About 10,000 Russian ultra-nationalists marched across Moscow in an annual show of anger against the presence of Muslim migrants that witnessed dozens of arrests. The so-called "Russian March" -- an event coinciding with a new Unity Day holiday President Vladimir Putin introduced to commemorate the expulsion of Poles from Moscow in 1612 -- has been previously accompanied by violent attacks against ethnic minorities and foreigners working in the city. AFP PHOTO / VASILY MAXIMOV (Photo credit should read VASILY MAXIMOV/AFP/Getty Images)

With oil prices plummeting, the ruble tanking against the dollar, and the Russian economy squeezed by Western sanctions, Russian Prime Minister Dmitry Medvedev on Monday offered an assessment that might easily qualify as the understatement of the new year. “The economic situation is quite problematic to say the least,” he said.

Even as Russian consumers find the value of their rubles shrinking and consumer goods harder to find, there is a flip side to the contraction, one that has potentially significant ramifications for Russia’s volatile domestic politics. Since the first week of January, labor migration into Russia — mostly from Central Asia and the Caucasus — has dropped 70 percent compared to the same period last year, according to data released by Russia’s official Federal Migration Service. That could be a boon for Russia’s vocal, xenophobic, and occasionally violent nationalist movement, which wants many of those immigrants to go home.

Russia, population 144 million, is home to at least 11 million immigrants, mainly from former Soviet countries like Moldova, Ukraine, Uzbekistan, and Tajikistan. The numbers of migrants had been growing for years, sparking clashes between members of Russia’s ethnic Slavic population and the mostly Central Asian newcomers. In 2014, 19 people were killed and 103 were injured in ethnically charged attacks, according to the Sova Centre, a Russian think tank. In one often-cited example of violence, riots broke out in the Moscow suburb of Biryulyovo in 2013 after a Russian soccer fan was killed by a migrant from Azerbaijan. The riot began with protesters chanting “Russia for the Russians” and “White Power,” before a wave of violence leveled the suburb and police intervened and arrested 400 rioters.

Migrants had flooded into Russia despite those tensions because there were far more economic opportunities there than at home. Workers from Central Asia have sent much of what they earned back their families, making the overall economies of Central Asia deeply dependent on remittances. According to the World Bank, remittances make up 42 percent of Tajikistan’s GDP, the highest percentage in the world. Kyrgyzstan comes in second, with remittances counting for 32 percent of its GDP.

With the ruble having plummeted by 40 percent against the dollar in 2014, the value of those remittances has been cut nearly in half, causing many to stay home rather than make the journey to Russia.

The origin of the current labor influx and its subsequent decline lies in the Russian construction boom financed by the oil bonanza of the 2000s. Millions of labor migrants from Central Asia and other former Soviet satellites and republics streamed into the country eager for plentiful, though low-wage, work. In 2012, Russia’s Federal Migration Service stated that the country needed immigrants to prevent workforce shortages due to the country’s shrinking population.

For their part, the autocratic and economically impaired Central Asian governments were eager to see workers go abroad, viewing labor migration as a type of social “safety valve” to postpone economic stagnation and ward off political instability at home, according to experts.

Many native Russians, however, have become increasingly concerned that the immigrants will eventually take their jobs. According to a poll carried out in January 2014 by the Levada Center, a Russian think tank, 76 percent of Russians believe the number of immigrants should be restricted.

The Russian government has generally tolerated both legal and undocumented migrant workers, but it has begun to crack down recently as xenophobic feelings rise in much of the country. In the fall of 2014, Russian authorities arrested more than 7,000 migrants from Central Asia and the Caucasus in Moscow and deported another 800 others. In the last six months, Moscow has placed new restrictions on legal migrants, such as mandatory Russian language and history exams, which came into effect on Jan. 1, and begun turning away more would-be migrants at the border.

With more migrants staying at home in Central Asia, the region could see an upswing in political instability. To see how that might happen, look no further than Kyrgyzstan’s 2010 revolution.

Following the 2008 economic crisis and a major drop in crude prices, the Russian economy went into a nosedive. The construction boom fizzled, and newly unemployed, mostly male migrants returned to Kyrgyzstan. Aided by opportunistic politicians and frustrated by their lack of economic opportunities, they launched a campaign of street protests and overthrew the corrupt government of President Kurmanbek Bakiyev in April 2010.

Now, another generation of unemployed workers are heading back to their corrupt, economically stagnant, Central Asian homes. If more governments start collapsing along Russia’s periphery, Medvedev will have other “problematic” situations to worry about.


Reid Standish is an Alfa fellow and Foreign Policy’s special correspondent covering Russia and Eurasia. He was formerly an associate editor. Twitter: @reidstan

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