Russia’s economy was only slightly affected by Western sanctions over the war in Ukraine last year. The contraction amounted to 2.1 percent. That says the Russian statistics agency Rosstat. But Western institutions also agree.
Less than a year ago, Russia was buried under economic sanctions from the West. As a result of the invasion, countries such as the Netherlands started to import fewer raw materials, such as gas, from Russia. Import bans also applied to other products. Furthermore, many large Western companies, such as McDonald’s, ended their activities in Russia.
Economists initially predicted that these measures would have a significant impact on the Russian economy. For example, the International Monetary Fund (IMF) initially assumed a contraction of almost 9 percent.
But Rosstat’s figures now show that the damage is considerably smaller than expected. For example, despite the sanctions, the country managed to earn more money from the export of raw materials. This is partly due to the increased prices of gas, for example. Russia also traded more with large economies that did not participate in the sanctions, such as China and India.
Due to a lack of transparency, economists trust the data from Russia less than before. Still, today’s numbers are roughly in line with the IMF’s expectations (-2.2 percent). The OECD and the World Bank are less optimistic about the Russian economy. Those organizations assume a contraction of 3.3 and 4.5 percent respectively in 2022.
These minuses are a lot bigger than those of Rosstat and the IMF, but both show that the Russian economy is performing better than expected. For this year, the IMF even expects a small growth of 0.3 percent.
