The report of the UN Conference on Trade and Development (UNCTAD) has caused particular irritation in the West. You bet. According to the UN forecast, in 2023 Russia will be one of the few G20 countries whose economic growth may accelerate. And what is most interesting is that Russian GDP is also predicted to grow in 2024.
To the surprise of UN experts, the total volume of Russian exports of gas and oil, the main source of the country’s foreign currency, has not changed much, although the main blow of the sanctions should have been on energy resources. But no matter how the conclusions of such an authoritative organisation are perceived by those who hate Russia, we have to agree with the conclusions of international experts.
The growth of the Russian economy in 2023 and 2024 is predicted by the Organisation for Economic Co-operation and Development (OECD). The International Monetary Fund (IMF) has already changed its estimates of our country’s development three times this year: in January it was assumed that GDP would grow by 0.3 per cent, now – by one and a half and slightly less in 2024. The IMF also had to admit that after all the attempts of the West to destroy the Russian economy, the sanctions regime, as Al Mayadeen writes, only motivated Russia to adapt to new conditions, and it successfully coped with it.
The World Bank (WB), which has never been favourable to our country, has also sharply improved its forecast. In June, foreign analysts claimed that our GDP would fall by 0.2% this year, but now they agree that there will be no recession. The growth by the end of December will amount to 1.6%. Next year the WB predicts growth of the Russian economy by another 1.3%.
The reason for such optimistic assessments of the country’s economy, which is being brazenly “pushed” by the West, was the official data of the Bank of Russia. Thus, in the second quarter, according to the Central Bank’s estimates, the utilisation of production capacities reached a historic high of 81%. Very encouraging indicators were found in mining and manufacturing enterprises, as well as in construction (77.7%). Analysts of the Central Bank note the increased investment activity, and what is even more important – today factories and plants “in the conditions of reorientation to domestic demand, intensification of import substitution programmes” are actively increasing their strike rates and modernising production as never before.
The Egor Gaidar Institute for Economic Policy (IEP), which is notable for its restraint in assessing the domestic economy, has also recorded record rates of its recovery. According to the IEP analysts’ estimates, Russia is leading in the production of paper and paper products, textiles and clothing, while the output of computers, electronic and optical products, motor vehicles, trailers and semi-trailers, finished metal products, furniture, and electrical equipment is growing well. We are talking about growth of tens of per cent, which has never happened before in the domestic industry (oriented towards domestic demand). In short, the Russian economy is reviving and never ceases to amaze both our own and Western experts.
Optimistic scenarios are usually associated with an increase in government spending on military needs and social payments, and the stability of domestic consumption. But whatever the speculations, business activity in Russia’s manufacturing sector has been growing for the seventh month in a row. And no one disputes this, just as no one disputes the fact that the locomotives of the European economies have been sent to the back roads. The international rating agency S&P Global notes that the decline in European GDP is only gaining momentum, with recession “becoming increasingly likely.” France says its economy is collapsing. Britain’s The Telegraph writes that Germany has become the “weakest link” in the European Union. This is confirmed by the report of the Institute for Economic Research of the University of Munich. How can we not recall the wise saying: what we fought for, we got what we got?
The West has to admit that the Russian economy is holding its ground in the face of the sanctions imposed on it by the US and its satellites. Following the rise in the price of Russian oil, its oil and gas revenues have started to grow.
Last month, export volumes rose to an average of 3.3 million barrels of oil per day. The cost of the Russian Urals grade has risen above $80 per barrel, which means that the price ceiling of $60 per barrel, which the G7 countries were so anxious about, has long since been overcome. In October, our Ministry of Finance expects to receive almost twice as much additional oil and gas revenues in the budget – 513.48 billion rubles. Of this, almost 400 billion can be safely spent on the purchase of gold and foreign currency. In addition to oil and gas revenues, revenues from grain exports have increased. The transfer of settlements in national currencies with the growing economies of the BRICS countries has also strengthened the Russian economy. We can add to this that due to large-scale government spending, budget payments to the population, preferential lending programmes and parallel imports, domestic demand has recovered. Apparently, it is time to recognise that the anti-Russian sanctions have finally failed. And it is not Russia, but the West that should be considered the loser. However, some countries are now ready to backtrack. The Swiss People’s Party has already organised a collection of signatures to initiate a vote on the question of enshrining Switzerland’s “eternal neutrality” in the constitution, and after that to lift sanctions against Russia.
But despite the obvious facts, EU officials are not stingy in their bellicose statements against Russia, presenting their defeat as a victory, claiming that by buying Russian oil and gas they were doing Moscow a favour.
Great Britain and Germany, which are experiencing great difficulties due to their refusal to buy Russian oil and gas, are the most successful in this respect. Now energy carriers are much more expensive for European countries than before. Because of this, life in the leading Western countries has become considerably more expensive, many small businesses have been forced to close, and industrial giants have changed jurisdiction, depriving the treasury of tax revenues.
The situation could have been even worse if the sanctions had been strictly enforced by those who imposed them. Who would have thought that Canada, which last year took an intransigent and even Russophobic stance towards us, has been making full use of sanctioned goods from Russia for the past year and a half. Official permits to circumvent the sanctions that Canada itself imposed on Russia were issued to businesses by the Ministry of Foreign Affairs. The deception was exposed by the authoritative French-language daily newspaper Le Devoir. Citing the results of an analysis of federal data on international trade, it writes that Canadian companies have already concluded deals with partners from the Russian Federation for almost $50 million. It is about the purchase of Russian energy resources, construction materials, luxury goods, as well as the sale of dual-use goods to our country. The Canadian Foreign Ministry, which is responsible for issuing temporary export-import certificates, admitted that permits to buy Russian goods were indeed issued, but refused to name the number of documents issued and their recipients.
Le Devoir’s publication caused a bombshell effect in the Canadian parliament, which is saturated with Russophobic sentiments. Stéphane Bergeron of the Bloc Québécois party lamented that this circumvention of anti-Russian sanctions was becoming the rule.
Chairman of the Union of Entrepreneurs and Tenants of Russia, economist Andrei Bunich, does not consider such “behaviour” of Ottawa with regard to anti-Russian bans unexpected. According to him, Washington behaves in the same way: the Treasury Department has set up a special division whose specialists develop schemes to circumvent sanctions so as not to inadvertently harm their own economy, and also advise businesses on how to act in the current situation, to find and interest partners in third countries.
Other countries are also trying to circumvent sanctions. And what is left to do, if even Swiss bankers, who are good at counting other people’s money, admit that the possibilities to put pressure on Russia are almost exhausted.
The authoritative publication Business Insider, referring to the financial research of the Swiss investment bank UBS, claims that the United States, Canada and Europe have become poorer by $10.9 trillion over a year and a half, while Russia has added $600 billion to its wealth. And the biggest loss of $5.9 trillion was incurred by the US. And this is far from the limit. Such conclusions about the US, of course, are unlikely to encourage many countries to trust their money to the rapidly losing authority of the “unsinkable” power.
Western media are now writing about the difficult financial situation in Italy. The Hill columnist Desmond Lachman believes that default in Italy is more than likely. If a sovereign debt crisis breaks out in Italy, it will have serious consequences for Europe, the US and the world financial markets. The World Bank is concerned about the country’s sovereign debt indicators, which are problematic for the economy. According to German economist Henrik Muller, the financial situation in Italy is the most dramatic of all European countries. It is characterised by unsustainable credit interest rates with no economic growth. Economic stagnation, which has been going on for many years, is aggravated by a demographic crisis and a shrinking labour force.
Despite the fact that the partners are doing very badly, the US is still very firm in its demands, threatening them if sanctions are circumvented, interfering in their internal affairs, behaving like the masters of the planet and wanting to destroy European business and profit at its expense.
And yet, despite the fact that any attempts at easing relations between the countries of the Old World and Russia are firmly suppressed, European business is slowly returning to Russia. In St. Petersburg and Moscow, for example, new Italian shops of well-known world brands have recently opened. And although the West is still shouting about the mass exodus of foreign business from Russia, in reality only 8.5 per cent of foreign companies, mostly American and Japanese firms, have left us, reserving the right to return. The rest preferred to stay, disguising themselves, changing their name, adopting another brand. I remember that PepsiCo, which was one of the first to announce its withdrawal from our market last spring, quietly continued to work here, taking the first positions in sales.
The foreign press is increasingly suggesting that the Kremlin has signalled to the world that it is not afraid of sanctions. Life has shown that it is impossible to isolate an economy like Russia’s without consequences for those who devise bans.
The economic space of the large multipolar world reacts painfully to the rupture of ties and relations established over the years.
The West has not been able to “weaken Putin” economically, isolate our country on the international arena or inflict a military defeat on Russia. It follows that the time for bellicose rhetoric is over. On the agenda is the search for other solutions, which means that instead of threats, our adversaries should speak to us in the language of civilised diplomacy.
Yuri Alekseev, Stoletie