This state-imposed stagnation is made much worse by the combined effect of the West’s sanctions, a lack of access to financing, capital flight and a climate of uncertainty, which is locking Russia into a sustained period of near-zero growth. The economic spillover of the Ukraine crisis reveals “the downside of state capitalism”, says Alexander Kliment of Eurasia Group, a think-tank. When things are going well, he says, the power of the market helps strengthen the state. But when the state starts to have problems with the outside world, the economy suffers—dramatically.