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Russia’s economy is expected to outpace the economy of every G7 country next year. Why the West’s sanctions have been almost useless

The US don’t try to annex Ukraine, Georgia, Moldavia. you don’t see the difference?

Russia’s economy lives on selling energy. Most Russians work on energy, minerals and for the government. 2/3 alone on energy sectors. Russia don’t produce finished products. Now Europe market gone, they can only sell a fraction of it to China, India at lowest price. Russia’s automobile industry is down 99.9 percent. Where do those abundant workers find their jibs? Only naive person like you believe to Moscow economic propaganda shit.
How many Americans live in Ukraine, Geogia and Moldavia and how they are provoking US? Russia's economy figures are backed by cross country trade figures, it is US economic figure which is artificially blown up by inflation and money print truly unreliable.
 
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Lol the ruble is worthless outside of Russia. You might as well believe Iran's GDP per capita is 2x of China's and have a GDP of around USD2tril (larger than South Korea/Italy) based on the official exchange rate used by IMF.

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How the IMF naively parroted Putin’s fake statistics–and botched its economic forecast for Russia​


The chorus of voices claiming the Russian economy has proven vastly more resilient than expected is growing. Even former U.S. Treasury Secretary Larry Summers and CNN’s Fareed Zakaria have wrongly despaired over the inefficacy of Western sanctions on Russia.

The implications are equally disturbing–that unprecedented U.S.-led sanctions don’t work. Following on the IMF’s latest assessment that the Russian economy shrank by a less-than-expected -2.2% in 2022, many of these commentators point to the IMF’s projection of fractionally positive economic growth in Russia of +0.3% in 2023, outstripping Germany and the U.K., as evidence that the economic pressure campaign against Russia has failed.

Yet nothing could be further from the truth. Far from serving as the independent arbiter of the statistical underpinnings of global economic activity, the IMF has been asleep at the switch.

With respect to Russia, it is naively echoing Putin’s own invented GDP forecasts, in effect, canonizing and legitimating these economic myths with no verification–in fact, no independent analysis at all.

The IMF’s dubious methodology in tracking the Russian economy warrants close scrutiny. Nothing short of its institutional credibility is at risk, especially since the current IMF chief, Kristalina Georgieva, has been accused of pressuring economists to boost China’s business climate ratings during a previous tenure at the World Bank, which she denies.

For starters, the IMF’s forecast of economic growth in Russia exceeds even that of the Russian central bank, which expects GDP to fall by at least 1.5% this year. Even Russian oligarchs such as aluminum tycoon Oleg Deripaska are openly fretting about how Putin will run out of cash next year–and how he’s been cannibalizing Russian companies to make ends meet! Yet the truth is, as they candidly admitted to us, the IMF Russia Desk economists have “basically zero visibility” into what is actually going on in the Russian economy.

This is at odds with IMF protocols. Since the outbreak of war, the IMF has allowed Russia to be in violation of its own membership standards–which require member states to disclose transparent, verifiable, and comprehensive national income statistics.

Putin now refuses to disclose major economic indicators ranging from foreign trade data, monthly output data on oil and gas, capital inflows and outflows, financial statements of major companies, central bank monetary base data, foreign direct investment data, domestic value added by industry, and lending and loan origination data. Even Rosaviatsiya, Russia’s federal air transport agency, has stopped publishing data on air passenger volumes. Yet these are the major high-frequency flow statistics that go into the construction of an economy-wide GDP forecast for any nation–from the U.S. to China.

Thus, the IMF simply does not have the data needed to independently calculate Russia’s GDP by any accepted method–whether it’s by expenditures, production, or incomes. They are flying blind, with the Russian institutions offering zero visibility.

Rather than publicly admitting what they don’t know, they privately admit the “massive uncertainty.” The IMF Russia Desk economists unquestioningly swallow what little data Putin does release–cherry-picked and fabricated data releases spewed out by the increasingly unreliable Kremlin agency Rosstat, falsely certifying Putin’s fable of economic triumph.

There is no shortage of reasons why Rosstat releases should be treated as dubious when not verified against cross-channel checks and alternative benchmarks. Rosstat has a long history of manipulating official economic statistics to please Putin, “bending over backward to correct bad numbers and burying unflattering statistics” under the pressure the Kremlin has exerted to corrupt statistical integrity.

The agency has been “switching to new methodologies” and “recalculating data” with alarming frequency. Then there’s the overt political interference–Putin has fired the heads of Rosstat, transferred control of the agency to political appointees, and appointed a blatant political pick as deputy economic minister. It is no wonder outside observers ranging from international organizations to foreign investors regularly sound alarms over “concerns about the reliability and consistency of the Kremlin’s economic releases.”

However, the IMF remains mysteriously silent on the issue of Russian data integrity. Curiously, top IMF Russia Desk economists have admitted to us that they have “not had any engagement” with alternative Russian data sources. Apparently, that is too difficult to do, especially having “evacuated their entire Russian team.”

That is especially worrisome since so many independent economic facts contradict their published estimates. For example, our latest tabulations show that over 1,000 major multinationals have completely exited the country in protest of its illegal war in Ukraine.

Collectively, they have combined in-country revenues equivalent to 40% of Russia’s pre-war GDP by our estimates. Moreover, Russia has been reduced to irrelevancy in the global economy, as the world has moved on from Russian energy, food, metals, and other commodities.

Energy, the mainstay of the Russian economy, is in especially serious trouble. Energy export earnings are now down $500 million a day relative to last year’s highs. Due to insufficient pipeline capacity to major customers like China and India, Russia can’t seem to sell the 86% of its natural gas exports which previously went to the EU. Moreover, with the persistent Urals oil pricing discount, Russia is not making much money on every barrel of oil they sell when the price of oil is only around $55/barrel.

Our triangulation of primary source data–wherever Russia was the buyer we checked with the seller and vice versa–shows that virtually every sector has collapsed, with some such as automotive down more than 90%.

Millions of people have fled Russia this past year to neighboring nations, with TASS reporting 700,000 emigres just in April. The Uzbek ambassador to the U.S. told us last week that almost 500,000 Russians have fled to his country with employment in the Tashkent Technology Park soaring 500%–in what is dubbed the “Tash rush.”


Yet the IMF publicly chooses to ignore all of these well-documented data challenges, merely putting out a Putin-echoing sanguine GDP assessment while obfuscating the underlying inputs and assumptions. We don’t presume to know why. In fairness, we should ask why the Biden Administration and Congress have not filled the U.S. seat on the IMF’s Executive Board, leaving the largest vote share (16.5%) unrepresented–while Russia remains well represented by a veteran IMF insider who has the most seniority of any country’s representative, tilting IMF governance politics.

As Abraham Lincoln famously warned, “You can fool some of the people all the time and all of the people some of the time.” It seems Putin can fool sophisticated Western media voices–and even economists and former policymakers much of the time.

The economic experts and media pundits who are parroting presumed wisdom are fueling sanctions skeptics, naively falling for Putin’s propaganda, and drawing a false sense of comfort from an unfortunate seal of approval that comes with a now-tainted IMF brand. For whatever reason, they are helping Putin erode Western unity.
 
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How many Americans live in Ukraine, Geogia and Moldavia and how they are provoking US? Russia's economy figures are backed by cross country trade figures, it is US economic figure which is artificially blown up by inflation and money print truly unreliable.
Your logic sucks. Do you know how many Russians live in Germany? And how many Germans live in Russia? A lot. You want Russia and Germany go to war? Russia cross trade is equal to Belgium. That’s nothing for the largest country on earth. The US trades are in trillions.
Instead of doing something useful Russians waste their lives for nothing.
 
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Brics and Asian countries should freely trade with Russia and show a middle finger to west
 
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Russia’s economy is expected to outpace the economy of every G7 country next year. Why the West’s sanctions have been almost useless​

The ruble is steady, inflation in check and the Russian economy is doing just fine. Sanctions have a poor track record, and the past year hasn’t changed that.

By David Olive
Sat., Feb. 11, 2023

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As Russia’s invasion of Ukraine nears its first anniversary, the economic isolation of Russia by Canada and its partners in a Western alliance to halt the war have little to show for that effort.

Direct financial and military assistance to Ukraine has helped Ukraine considerably against a determined enemy.

But if the goal of the most ambitious economic sanctions regime in modern history was to end the conflict by defunding Vladimir Putin’s war machine, the mission obviously has failed.

Indeed, the Western alliance has proved that armed conflict cannot be brought to an end with economic weapons alone.

Remarkably, the Russian economy is expected to grow faster this year than the economies of alliance partners Germany and the U.K.

That recent forecast, by the International Monetary Fund (IMF), also predicts that Russian economic growth will outpace that of all G-7 economies next year. The IMF forecasts GDP growth in 2024 of 2.1 per cent for Russia, 1.5 per cent for Canada, and 1.0 per cent for the U.S.

How is that possible, when the external pain inflicted on Russia’s economy has no modern precedent in its scope, speed and coordination?

Putin, who wasn’t expecting such comprehensive sanctions, has called them “economic blitzkrieg.”

Within days of Russia’s invasion of Ukraine on Feb. 24 of last year, Russia’s assets abroad were frozen. Its financial system was severed from the world. Many of its exports were banned, and its imports of essential goods were cut off.

More than 1,000 international companies withdrew from Russia, taking their capital investment and technology with them.

Last March, soon after Russia’s initial invasion of Ukraine, Janet Yellen, the U.S. treasury secretary, was confident that “the Russian economy will be devastated.”

But the sanctions regime has failed in its goal of hastening the end of the war.

Instead, Ukraine is bracing for a renewed Russian military assault, a spring offensive unlikely to be as hobbled by strategic errors as Russia’s earlier offensives.

And the economic pummeling of Russia has not brought the country’s economy to its knees. In December, 10 months into the Western sanctions regime, a U.S. government report acknowledged that the sanctions “have not delivered the economic ‘knock out’ that many predicted.”

That might be an understatement.

Russia’s central bank has minimized hardship for Russian civilians that might have weakened domestic support for the war on Ukraine.

The bank has kept inflation under control and has actually increased the domestic value of the ruble to pre-war levels. The current exchange rate is about 60 rubles to the U.S. dollar, up from about 75 before the war.

Russia has found alternative markets for its exports. Each of Brazil, China, India, and Turkey have increased their Russian imports by at least 50 per cent in the past year.

True, Russia is selling its oil at discounted prices. But that oil continues to generate cash flow to fund Russia’s war in Ukraine, as do continued exports of Russian natural gas, nickel, aluminum, and titanium.

The alliance has not sanctioned Russian agricultural exports, a mainstay of the economy, on grounds of global food insecurity.


As to critical imports, Russia is buying industrial parts from China, Turkey, and Belarus, among others. And its war machine is obtaining artillery pieces from North Korea and drones from Iran.

Finally, Russia has increased its defense spending by 43 per cent from 2021 levels. It is expected to spend more than $84 billion on defense this year , bulking up its domestic wartime economy.

Heightened activity in Russia’s military-industrial complex accounts for a large portion of the country’s outwardly impressive GDP growth.

There is an emerging if unspoken consensus in the Western alliance that the only way to stop this war is by conventional military means. That helps explain the alliance’s recent increase in weapons shipments to Ukraine.

To be sure, Russia’s current economic model leads to prolonged domestic misery. A lengthy war in Ukraine will eventually require cuts in education and healthcare budgets, which have already been frozen.

The ruble is worthless outside of Russia. Strict capital controls to keep money inside the country stymie domestic industry and discourage foreign investment.

Many Russian factories have closed for lack of parts and especially the semiconductors that power the Information Age.

A report by the European Union Institute for Security Studies acknowledges the “delayed effect” of sanctions. But it asserts that “Sanctions will permanently impair Russia’s economic and technological potential and lead to a long-lasting decline in living standards among the population.”

But that assessment provides no comfort to Ukrainians whose lives are in peril now.

As long as war kills large numbers of people quickly, the delayed impact of economically isolating a belligerent will not stop death and destruction.

Economic sanctions have a poor track record. And the past year has not changed that.

For all our modernity, the conflict in Ukraine is a reminder that wars still end only with military force, diplomacy, and prayers.

The IMF are quoting the Kremlin agency Rosstat. The IMF has zero access to any major economic indicators in Russia, since Russia refuses to disclose them. So this author is basing his point on fabricated Kremlin propaganda when speaking about the russian economy and predicted growth.
 
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Lol, even if Russia's GDP would rise by 20% it would not amount to the 400~ billion dollars of Russian assets that were frozen.

Russia has a huge budget deficit and huge workforce loss. Russia's position as an arms manufacturer as been shattered.
Europe transitions from Russian gas dependence while Russia will be forced to sell oil and gas for a few pennies of profit from China and India and some 3rd world countries.

The IMF are quoting the Kremlin agency Rosstat. The IMF has zero access to any major economic indicators in Russia, since Russia refuses to disclose them. So this author is basing his point on fabricated Kremlin propaganda when speaking about the russian economy and predicted growth.
IMF is a joke lol.
 
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The same bunch here arguing against Russia also claimed that Russia's economy was done barely half year ago, now they argue about IMF accuracy, I don't know what they would argue about half a year from now, they are just a bunch of clowns.
 
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It has to be said. Putin has really thought this through before going all out. No doubt Russian economy has suffered, but nowhere near where the Europeans and Americans were hoping for.
Economic sanctions worked in 1990-2015 hen China didn't have much technology

But these days China is producing everything including semi conductors(albeit much older generation)

So Russia technically can get any and every thing from china
 
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Economic sanctions worked in 1990-2015 hen China didn't have much technology

But these days China is producing everything including semi conductors(albeit much older generation)

So Russia technically can get any and every thing from china
Very true, China has the world supply chain tightly in her hands, what Russia can buy from the west that China can't provide?
 
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Very true, China has the world supply chain tightly in her hands, what Russia can buy from the west that China can't provide?
Russia is a tiny export market for China compared to the US, EU, Japan, South Korea. What makes you think China would side with Russia and jeopardize its main global trading relations?
 
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Russia is a tiny export market for China compared to the US, EU, Japan, South Korea. What makes you think China would side with Russia and jeopardize its main global trading relations?
US is anti China but still does business with her, bigger trade doesn't always translate into a good relationship, all the US allies have way bigger trade with China than with US.
 
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The IMF is just being lazy. Like how they are citing Iran with a $2tril GDP based on 'official' figures.

Those who really believe the Russian economy is growing need to have the heads check. Sanctions, frozen assets, falling energy prices, Ural's oil discount, losing their biggest customer, mobilization, ~500k-1mil mostly young Russians fleeing the country. If you believe they are still growing under these circumstances, you probably also believe that China only has 2 daily Covid deaths when they reopen their country because the given official figures say so.
 
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Economic sanctions worked in 1990-2015 hen China didn't have much technology

But these days China is producing everything including semi conductors(albeit much older generation)

So Russia technically can get any and every thing from china

China has a choice - Russia or EU
 
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The IMF is just being lazy. Like how they are citing Iran with a $2tril GDP based on 'official' figures.

Those who really believe the Russian economy is growing need to have the heads check. Sanctions, frozen assets, falling energy prices, Ural's oil discount, losing their biggest customer, mobilization, ~500k-1mil mostly young Russians fleeing the country. If you believe they are still growing under these circumstances, you probably also believe that China only has 2 daily Covid deaths when they reopen their country because the given official figures say so.
Exactly, Iran was my point when I said IMF was BS.

A country's economy cannot grow when one million people flee it (Especially since those 1 million are middle and upper class people), and a million more get drafted, with hundreds of thousands of dead/injured, with WW2 scale battles going on daily, with hundreds of billions of dollars worth of frozen assets.

China has a choice - Russia or EU
If it chooses Russia, all of China's silk road project goes to the trash.
 
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