Russia’s $11 Billion Soft Power Gamble

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I was sitting in the front seat of a “Yandex Taxi” in Moscow in the summer of 2018, dropping off some friends after we had drinks together at a local bar. As the driver, a Russian male in his 50’s, maneuvered through traffic, he asked me if the couple were Americans? “Yes. They are Americans.” “How about you?” he asked. “I am also an American.” Hearing this, the driver continued “You know, 10 years ago I started a small company in Moscow and was doing pretty well. Business was not bad and I enjoyed being an entrepreneur. But then after 2014, when foreign sanctions were placed on Russia my business started to suffer. The Government here claims that sanctions actually ‘help’ our economy, but not in my case. Two years ago I had to shut down my business completely and now I’m driving a taxi to make money to support my wife and daughter.”

Hearing his story, I wondered if this man blamed the U.S. for the sanctions and their impact on his life. “I’m sorry to hear about your troubles” I said. The driver must have understood what I was wondering, and he responded “Don’t misunderstand me. I do not blame you or your country for my problems. I don’t blame the U.S. for the sanctions. No. I blame our “great leader”. Vladimir Vladimirovich Putin. He is the reason for the sanctions. He decided to invade Ukraine in 2014 and, as a result, we were hit with sanctions. And for what reason? Why? Because it would make my life better? Is my family's life better? No. Because it pleased his ego. Because he wanted to feel important and get attention. No. I don’t blame anyone but our own President and his selfish ego.”


This conversation took place during the 2018 World Cup, which was hosted by Russia. Speaking about that event, the driver continued “look around? Look how much money Putin has put into hosting the World Cup. Billions of USD. Our money. The people’s money? Building a new stadium. Re-paving roads, cleaning up cities and refurbishing airports. Teaching police officers and bus drivers how to speak some English and translating street signs and metro signs into English to accumulate the thousands of foreign tourists coming to attend the World Cup. It is all a big show for Putin. An opportunity for him to show off to the world. But will any of this benefit us, the Russian people? Will we see any return on our investment? No. I doubt it. If there is any profit from all of the tourism, it will go into the pockets of Putin and his friends. My family and I will never see any benefit from hosting the World Cup in Russia.”

Last night, watching South Korea play Mexico in the 2026 World Cup, I was reminded of that conversation. If, by any chance, the driver was wrong in 2018 and Russia saw some benefit from the influx of tourists that visited Russia in the summer of 2018, there is little chance that the benefits continued after February 2022, when Putin decided to up the ante and expand his aggression against Ukraine. That disastrous decision has not only resulted in the humiliation of the Russian Armed Forces, deaths of hundreds of thousands of Russians, crippling of the Russian economy but it also resulted in the increasing isolation of Russia. If hosting the World Cup in 2018 was meant to present Russia as a tourist destination for foreigners, how many tourists would dare visit Russia today?

According to some estimates, the Kremlin spent over 11 billion USD to prepare Russia to host the World Cup in 2018. Cities like Moscow and St Petersburg were given makeovers. Other Russian cities that hosted matches had to build new stadiums, and Moscow had to invest billions to build or modernize infrastructure. All part of a Kremlin campaign to present Russia to the world as a modern and developed country. Classic soft power strategy.

At the time, the strategy appeared to work. Hundreds of thousands of World Cup fans poured into Russia. Downtown Moscow was filled with foreign tourists. Despite the political tensions between the U.S. and Russia at the time, and the fact that the U.S. did not even qualify for the World Cup in 2018, Americans made up the largest number of foreign visitors to Russia during the World Cup. During that period, many of the visitors came away with a positive impression of Moscow. Of Russia. Of Russians. Many had a great time celebrating and partying. Russia had a great marketing opportunity to present itself to the world.

Unfortunately, my taxi driver was right. The 11 plus billion USD invested by the Kremlin in Putin’s soft power gamble was erased by Putin’s ego. His gambit to assert full control over his western neighbor in February 2022 led to a significant decline of tourism to Russia and a darkening of Russia’s image in the eyes of the world. How many tourists today would seriously consider visiting a country that is accused of committing war crimes against the Ukrainian population? A country run by an oppressive regime that regularly kills its critics and has forced millions of its own citizens to flee abroad to seek refuge. A country that itself is now being regularly targeted by increasingly effective drone strikes in response to Putin’s continued attempts to terrorize Ukraine. As World Cup fans watched Mexico and South Korea play on 18 June, how many would seriously be interested in visiting the Russian capital, which was covered in dark, black toxic fumes rising from a fire caused by a Ukrainian strike against a Russian Oil refinery in Moscow? I suspect not many.

I often think of that Russian taxi driver, who was trying to make a living after his business was forced to close because of Russia’s growing economic problems in 2018. At the time he understood that without Putin’s ego and poor decision making, there would have been no sanctions. Markets would have remained open to Russia goods and businesses. And, like many Russians I knew at the time, he did not blame Washington, Brussels or Kyiv for Russia’s economic problems. He rightly blamed Putin. And I suspect more and more Russians today feel this way – even if they are afraid to openly admit it.

All statements of fact, opinion, or analysis expressed are those of the author and do not reflect the official positions or views of the US Government. Nothing in the contents should be construed as asserting or implying US Government authentication of information or endorsement of the author's views.

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