A man walks in front of a closed shop in central Moscow on May 30, 2022./Kirill Kudryavtsev/AFP/Getty Images
2023.03.04 Sat posted at 11:30 JST
London (CNN) Russia may run out of cash as early as 2024 and needs foreign investment. Oleg Deripaska, a Russian oligarch known for his outspoken statements, expressed such a view.
He made the remarks at an economic conference held in Siberia on the 2nd. This is reported by the Russian state media TASS.
Deripaska last year called for an end to Russia’s war in Ukraine early in the conflict. In contrast to his remarks, Russian President Vladimir Putin gave the country’s economy a positive outlook last week. He praised the country’s economic resilience and its ability to withstand unprecedented sanctions imposed by the West over the past year.
Russia’s gross domestic product (GDP) contracted by 2.1%, according to initial estimates by the Russian government. The decline was more limited than many economists had previously predicted.
Still, there are danger signs, such as curtailing oil production this month. There is also the possibility that the West will move to further tighten sanctions in the future, and the outlook for the Russian economy will depend on the war situation in Ukraine.
Foreign investors, especially those from “friendly” countries, also play a big role, Deripaska said. He said whether they would invest would depend on whether Russia could create the right conditions and make the domestic market attractive.
Western powers have announced more than 11,300 sanctions since February to drain Russia’s funding for the invasion. Russia’s foreign exchange reserves of more than 300 billion dollars (about 40 trillion yen at the current rate) were frozen.
Despite China’s financial support, including the purchase of energy from Russia, the Russian government’s revenue in January this year fell 35% from the same month last year. Meanwhile, spending has increased by 59% and the budget deficit is about 1.761 trillion rubles (about 3 trillion yen).
Deripaska, who made his fortune in the aluminum business amid the turmoil after the collapse of the Soviet Union, now has a net worth of just under $3 billion, according to US magazine Forbes.
