Deep Crisis in Russia’s Paper Industry: Impact on Economy and Workers
According to Ukrainian intelligence sources, the situation in Russia’s paper manufacturing sector has reached a critical point.
Leading enterprises in the industry are facing financial collapse due to mounting debts, economic downturns, and legal disputes.
Information obtained from Ukraine’s Foreign Intelligence Service reveals that Russia’s major producers of timber and paper products are burdened with enormous liabilities and penalties, resulting in widespread bankruptcies and unpredictable sanctions against individual companies.Notably, the industry’s leader—Public Joint-Stock Company ‘Segezha Group’—reported a net debt of over 147.9 billion rubles, despite its revenue growing by 15% in 2024 to over 101.9 billion rubles.
Attempts to attract investments totaling 113 billion rubles in June 2025 did not improve the situation, and the company continues to operate at a loss.
Simultaneously, over 300 arbitration cases with claims totaling approximately 72 billion rubles have been filed against the holding in the Leningrad region.Similar problems are observed in other regions as well.
For example, LLC ‘FJ Zhesart’ from the Republic of Komi, the largest producer of plywood in the region, posted a net loss of 1.1 billion rubles for 2024—almost twice the previous year’s figure of 584 million.
Experts point out that this crisis reflects deeper issues within the Russian economy, including declining investment attractiveness, increased sanctions pressure, rising credit burdens, and brain drain.It is also noteworthy that in July, Russia’s manufacturing sector recorded its worst performance in over two and a half years, highlighting the seriousness of the crisis.
The instability and industrial downturn are impacting not only specialized companies but the entire Russian economy, leading to mass layoffs and reduced citizen incomes.