While many Americans like to belittle the Russian Federation as “a gas station with nukes,” the reality is something altogether different. Because of heavy western sanctions which began in 2014, Russia was forced to adapt and become for efficient and self-sustainable. The results of the transformation have shocked western experts who were certain that their ‘maximum pressure’ campaign against Moscow would cause the country to collapse from within.
The economy of Russia is an emerging and developing, high-income, industrialized, mixed market-oriented economy. It has the eleventh-largest economy in the world by nominal GDP and the fourth-largest economy by GDP (PPP).
Despite many overriding macroeconomic and international issues, Russia’s economy is still managing to outperform its European counterparts.
While the country is under growing strain, Western media reports of its ‘imminent collapse’ are in fact grossly exaggerated…
Julian Cooper reports for Asia Times….
In recent months, many Western media commentators have suggested the Russian economy is in such serious trouble that President Vladimir Putin will soon have little choice but to end the war in Ukraine.
In December, the Washington Post reported fears among Russian businesses that interest rate hikes to combat inflation could bring the economy to a halt in 2025. More recently, an article in Politico suggested the reason Putin now seems ready to negotiate an end to the war is because he wants to “avoid a humiliating bankruptcy.”
Since Russia’s full-scale invasion of Ukraine three years ago and the subsequent imposition of tough economic sanctions, the Russian economy has unquestionably been under pressure. Problems have been accumulating and Russia does appear to be experiencing gradual economic decline – but not at all to the extent that has been claimed.
Russia’s economic performance over the last four years can be summarized by a look at the key indicators. While there are doubts as to the precision of some official Russian statistics, they still present a fair picture of the overall situation.
How Russia’s economy has changed throughout the war:
TABLE: Russian official statistics suggest the economy has proved to be robust despite the war. Rosstat and Ministry of Finance / 2025 Ministry of Economic Development forecast, CC BY-NC-ND
In spite of the war and sanctions, the Russian economy has proved to be robust. Growth has been driven to a large extent by sharply increased budget spending, not only on the military but on infrastructure projects.
