Putin underscores the strong Russian economy driven by military spending and domestic demand./Contributor/Getty Images
2023.08.12 Sat posted at 17:30 JST
(CNN) Russian President Vladimir Putin said by Wednesday that military spending and domestic demand were driving the economy, while manufacturing jobs stabilized at around 10 million, the same level as in 2021. It was reported that
During a meeting with industry leaders at the Blue House, he said two-thirds of the growth in industrial production was coming from the defense sector, with the rest coming from consumer demand. Salaries have also increased, more than 20% above last year’s levels, he said, largely due to a labor shortage.
Labor productivity also increased by about 5%, but he did not mention the period covered. The increase in production was particularly noticeable in the computer sector and finished metallurgical products, he said.
Russia’s economy dropped out of the top 10 in the world, and its gross domestic product (GDP) fell to roughly the same level as Australia’s. However, it remains one of the largest suppliers to the world’s energy export markets, including China and India.
It also maintains its position in the face of economic sanctions imposed on Russia by the West following its invasion of Ukraine.
Economic analysts say the Russian economy is unlikely to experience negative growth this year, but the weakness of its currency, the ruble, poses a risk.
Consulting firm Eurasia Group said the ruble’s devaluation would “increase fiscal instability and will inevitably add to the already mounting inflationary pressures in the coming months.” A sharp increase in wage growth could also add to inflationary pressures, he said.
Experts expect Russia’s budget deficit to reach 2-2.5 percent of GDP this year. This figure assumes a recovery in the price of Russian oil procured by customers in the Asian region.
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2023-08-12 08:30:00
