Russia’s gross domestic product is now growing faster than the economy of the largest Western countries, new figures from the IMF show.
This is happening despite the fact that the country’s warfare in Ukraine is costly, and that Western countries have introduced extensive sanctions against large parts of the Russian economy.
The IMF this week raised its forecast for the Russian economy, which grew by 3 percent last year, writes the Financial Times.
Growth this year will probably be the same and thus higher than in all G7 countries, the IMF predicts.
Oil and weapons
Russian President Vladimir Putin uses the opportunity to take a jab at critics in the West.
– They will not succeed. Our economy is growing unlike theirs, he said recently in a speech in Tula, the heart of Russia’s arms industry.
The Russian invasion and warfare in Ukraine has caused the Russian state to invest large sums in arms production.
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Combined with high export revenues from oil and gas, it has given the Russian economy a real boost, notes the Financial Times.
Economists nevertheless warn that there could be serious setbacks. Because while the Russian economy was previously very dependent on oil and gas revenues, it now depends increasingly on arms production, they point out.
– The longer the war lasts, the more dependent the country’s economy becomes on military investments, concludes the Vienna Institute for International Economic Studies (WIIW) in a recent analysis.
When the war one day ends, it could therefore lead to a complete collapse of the Russian economy, they warn.