At the end of 2023, the volume of Russia's gross domestic product (GDP) increased by 3.6% compared to 2022 - to 171.04 trillion rubles. This preliminary assessment was presented on Wednesday, February 7, by the Ministry of Economic Development and the Federal State Statistics Service.

According to departments, strong growth was observed in most industries. For example, the volume of construction work from January to December increased by 7.9% year-on-year, manufacturing - by 7.5%, wholesale trade - by 10.9%, and retail - by 6.4%. At the same time, the monetary income of the population increased by 4.6% in real terms, that is, taking into account inflation.

In general, the achieved rates of economic growth turned out to be significantly higher than the authorities' expectations. Thus, in the September forecast of the Ministry of Economic Development it was assumed that GDP would grow by only 2.8%.

“The economy has demonstrated resilience, withstood unprecedented external pressure and continues to develop confidently. We were predicted... recession, failure, collapse, that under the pressure of sanctions we would retreat, surrender, fall apart. I would like to show a well-known gesture... They won’t succeed,” Russian President Vladimir Putin said on February 2 at the plenary session of the “Everything for Victory!” forum.

Let us recall that after the start of the CWO, Western countries began to announce economic sanctions against Russia that were unprecedented in scale. According to the specialized database Castellum.AI, in total, almost 18.8 thousand various restrictions are now in force in relation to Moscow (16.1 thousand of them were introduced since February 22, 2022). This is more than against Iran, Syria, North Korea, Belarus, Venezuela, Myanmar and Cuba combined.

The restrictions affected the energy, financial sectors, banking, aviation and trade. Along with this, almost half of the country’s gold and foreign exchange reserves were frozen (worth $300 billion), and many international companies announced their departure from the Russian Federation.

Under these conditions, some analysts initially predicted a collapse of 10-25% in the Russian economy in 2022. However, according to the latest estimates from Rosstat, the real decline was only 1.2%. Thus, the decline in GDP turned out to be less profound than in the pandemic year 2020 (2.7%) and the crisis years 2015 (2%) and 2009 (7.8%), according to materials from the International Monetary Fund.

Moreover, previously, specialists from the IMF, World Bank, European Commission, OECD and other organizations assumed that in 2023 Russia’s GDP would continue to decline. However, in practice, the country’s economy not only returned to its growth trajectory, but also exceeded pre-crisis levels in a number of indicators. The head of the Ministry of Economic Development, Maxim Reshetnikov, spoke about this earlier in an exclusive interview with RT.

“The economy really turned out to be significantly stronger and more flexible than many thought back in 2022 and even at the beginning of 2023. Entrepreneurs have done a great job of reconfiguring logistics, supply chains, payments, entering new markets, reorienting exports and imports, increasing production and finding personnel. And of course, (the decisive role was played. -

RT

) by people, workers, because ultimately they create added value,” the minister emphasized.

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According to him, today the Russian economy “is doing well and is going through all the challenges quite confidently.” This was partly facilitated by the anti-crisis measures of the government and the Central Bank, says Georgiy Ostapkovich, director of the Center for Market Research at the Institute of Statistical Research and Economics of Knowledge at the National Research University Higher School of Economics.

“The authorities, through their actions, prevented financial chaos. Plus, the military-industrial complex made a big contribution against the background of a serious increase in defense orders from the state. In general, we see that almost all industries have adapted to the sanctions. Some did it better, some worse, but one way or another, almost everyone managed to adapt to the new realities,” noted RT’s interlocutor.

In addition, the expert believes, the accelerated recovery of GDP in 2023 provided a fiscal boost as the country’s leadership began to invest more money in the economy. A similar point of view was expressed by Alexander Abramov, head of the laboratory for analysis of institutions and financial markets at the Institute of Applied Economic Research at RANEPA.

“The country began to more actively use internal resources due to growth and stimulation of consumption, increasing investment activity, especially from state-owned companies. At the same time, it is important to note that the West was not able to isolate Russia from global trade, since all sales flows of export goods were preserved in terms of revenue indicators,” Abramov explained in a conversation with RT.

Playing ahead

It is noteworthy that in 2023, the Russian economy not only managed to fully recover the sanctions losses, but also showed higher growth rates compared to the G7 and European states - the initiators of anti-Russian sanctions. Thus, according to the IMF, in the USA, GDP grew by only 2.5%, in Japan - by 1.9%, in Canada - by 1.1%, in France - by 0.8%, in Italy - by 0 .7%, in the UK - by 0.5%, and in Germany the figure completely decreased by 0.3%.

Moreover, in addition to Germany, economic decline was recorded in nine other EU countries last year, according to materials from the European Commission. In particular, we are talking about Latvia (-0.2%), Lithuania and the Czech Republic (-0.4%), Austria and Sweden (-0.5%), Luxembourg (-0.6%), Hungary ( -0.7%), about Ireland (-0.9%) and Estonia (-2.6%).

“Our economy is growing, unlike their economies, and today... in terms of purchasing power parity (PPP)... it has become the first in Europe, the fifth in the world. And this process will increase,” Vladimir Putin emphasized.

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Let us explain: GDP at PPP is the total value of all goods and services produced, calculated taking into account differences in price levels and exchange rates in different countries. It is believed that this indicator better reflects the real situation in the economy.

According to the World Bank, from 2016 to 2020, the five largest economies in the world in terms of PPP remained China, the USA, India, Japan and Germany, and the Russian Federation occupied only sixth place. However, in 2021, Russia overtook Germany and took fifth place in the global ranking, and in 2022 it “secured” this position, noted Maxim Reshetnikov.

“In principle, speaking more broadly, we are looking at the Japanese economy. We do not have such a big gap with them, and if the differential in growth rates remains... then, in principle, we can say that in the medium term, within three to four years, we are quite capable of overtaking comparable the size of the Japanese economy,” the minister suggested.