Russia’s manufacturing activity also expands in December. The country’s PMI index shows the highest value in the world

The Russian economy remains toned, at least according to the index S&P Global Purchasing Managers Index (Pmi) which monitors the guidelines of company purchasing managers. The index fell by December to 53 points from 53.2 in November but it remains in an expansionary phase (above 50 points) and at the moment the Russian one is the highest figure among that of the countries monitored. Last November’s figure was the highest since January 2017 and analysts explain, the decline in exports for now it is offset by the increase in production and internal demand. The production of armaments may also play a role in this trend but, at the moment, the Russian economy shows no signs of collapse. “Higher production levels have been linked to a monthly recovery of new orders and the acquisition of new customers” reads the note from S&P Global. “The rate of output growth has eased from its recent high in November, but it was the second most marked since August 2020“.

Western sanctions and a mass exodus of foreign companies from Russia have caused logistical delays and material shortages and the economy shows an unexpected ability to adapt and resilience. According to the latest estimates, the Russian economy will contract in 2022 by 3%, a severe drop, but far from the expected collapses with the introduction of sanctions. Moscow has been cut off from many western production chains but still retains a large budget surplus which allowed the country to source supplies elsewhere. Many countries, starting with China, India and Turkey, do not share the US and EU approach and continue to do business with Russia, in many cases replacing the western question and providing the country with the products it needs. This makes the sanctioning mechanism porous. The limitations, all in all soft, on oil and natural gas exports from which Moscow obtains a large part of its revenues, according to several observers, allow the Kremlin to finance a “endless war” in Ukraine.