RUSSIA had some real economic problems even before the Ukrainian crisis led the United States and European countries to threaten sanctions on the country after the Russian flag was raised in Crimea, a part of Ukraine, and troops who spoke Russian appeared to take over a significant part of the region.
Russia’s growth had slowed to almost nothing: Its real gross national product in the third quarter of 2013 was just 0.6 percent larger than it had been a year earlier. The ruble was weak.
Its manufacturers appeared to be doing much worse than competitors in other countries. Its stock market has trailed markets in most other countries over the last year.
If this is a new incarnation of the Cold War, it will be very different from the old one.
Back then, the Soviet Union and the members of its empire were in some ways in their own economic world. They largely traded with each other, and they controlled the value of their currencies. Now, the world is a far more globalized place.
Just which side would have the ability to frustrate the other is the subject of debate now that John Kerry, the United States secretary of state, has threatened to throw Russia out of the Group of 8, to which it had been added in 1997. The other members are seven traditional economic powers: the United States, Britain, Germany, France, Italy, Japan and Canada.
On the one hand, Russia is a major supplier of energy to Western Europe. If it cut off its natural gas exports, several countries — notably the Netherlands — would have a hard time coping. On the other hand, energy accounts for most of Russia’s exports. Its supply of foreign currency reserves could be depleted rapidly if cash from Western Europe stopped arriving.
Germany is a substantial customer for Russian gas, but it also is a major exporter to Russia. It would be damaged more than most countries if a trade freeze developed. Last year, Germany supplied 12 percent of Russia’s imports, more than double the share provided by the United States. Western Europe has more to fear than the United States does from a prolonged Cold War.
On Monday, the same day that stock prices plunged around the world because of the Ukrainian crisis, Markit reported on the results of monthly surveys of manufacturers around the world, and Russia stood out on the negative side.
In those surveys, companies are asked if business is better that month than it was the previous month, both over all and in several areas. The accompanying charts show the results in two of those areas: output and new export orders. Figures over 50 indicate that more companies reported improvement than reported declines, while those under 50 indicate the reverse.
The charts compare the Russian results with the averages of two groups of neighbors. One includes the four Eastern European countries where the surveys are conducted — Poland, Hungary, the Czech Republic and Turkey. The other includes the four troubled members of the euro zone that are surveyed. Ireland and Greece had to be bailed out, while Italy and Spain have seen bond markets grow fearful of their ability to meet their obligations.
In 2012, manufacturers in Russia were reporting much better results than either of those two groups. But now, both of the groups say that export orders and output are rising. In Russia, they are shrinking.
If the new Cold War lasts for a long time, a substantial reduction in trade could damage both sides; each is far more dependent on the other than it ever was in the old Cold War. That provides a reason for both sides to compromise, but it also may provide a reason for each to be stubborn, expecting that the other will have to give in.
Floyd Norris comments on finance and the economy at nytimes.com/economix.