Russia's economy is 'imploding' on export decline, economists claim

[Ozero]

It's been over a year since the war began and it's quite shocking that the war has lingered this long. No one predicted the longevity of the war. But this is where we are and as it seems with all the unfolding drama the war has brought to the Russian economy and military, things might longer than we expect.

Looking at the effect the war has had on the Russian economy, I think it all struggled at the inception of the sanctions placed on them by the U.N, U.S, U.K and other powerful countries. However, things have flipped dramatically in favour of the Russian government to some extent as they have been able to form some sort of economic alliance with top energy producers globally including China and Saudi Arabia. These moves have to control favour the Russian government in the area of energy supplies and this stabilised the Russian economy.

More interesting developments may unfold. So, let's expect more twists...

Starting a military invasion of Ukraine, Putin expected to conquer all of Ukraine in a few days and install his puppet government there. To do this, at the same time as the invasion, the former President of Ukraine Yanukovych was brought to Belarus, who had previously fled to Russia and who was actually under the control of Putin. Therefore, Putin did not count on any Western sanctions. He hoped that Ukraine would fall even before any action was taken in Europe and the United States. But these plans were thwarted by the people of Ukraine and its armed forces. Only when they saw that the Ukrainians offered serious resistance and inflicted a major defeat on the Russian troops, after which they were forced to flee from the central and northern parts of Ukraine, so as not to be completely defeated, the NATO countries began to provide assistance to Ukraine, since they were interested in the military and economic weakening of Russia as a potential adversary, and without the loss of their soldiers, but by the hands of the Ukrainians.

Speaking of Russia's new economic union, do you mean the BRICS union? It is unlikely that he will significantly improve the current deplorable economic situation in Russia, which arose after Putin foolishly attacked Ukraine.

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[panganib999]

It's been over a year since the war began and it's quite shocking that the war has lingered this long. No one predicted the longevity of the war. But this is where we are and as it seems with all the unfolding drama the war has brought to the Russian economy and military, things might longer than we expect.

Looking at the effect the war has had on the Russian economy, I think it all struggled at the inception of the sanctions placed on them by the U.N, U.S, U.K and other powerful countries. However, things have flipped dramatically in favour of the Russian government to some extent as they have been able to form some sort of economic alliance with top energy producers globally including China and Saudi Arabia. These moves have to control favour the Russian government in the area of energy supplies and this stabilised the Russian economy.

More interesting developments may unfold. So, let's expect more twists...

Actually predicted this to drag out for long until one side relents and quits cause there's no way they'd both give up their stands. Russia's living in their delusional world where they think Ukraine's still part of them while of course the now sovereign state of Ukraine is fighting for their freedom. Economy can wait, they have allies that will help them fund and further their battle, plus at this point in time Russia's already forcing a huge portion of their male population to sign up to this needless war, so manpower wouldn't be a problem to them.

Just a few months ago I saw some news about Saudi buying Russian Gold, there's that too, plus a country which I forgot was also found to be financing the war on the side of Russia, there's a lot of things that are causing this war to drag out this long, it's not a matter of when they would stop, it's a matter of how.

[DrBeer]

A bit of reality
- The Central Bank has recorded a precipitous drop in the inflow of foreign currency into Russia. In April-June, Russia received only $5.4 billion of balance of payments surplus - the difference between the main currency flows in and out of the country. Compared to the same period last year, the economy's notional foreign currency profit collapsed 14 times, or by 93%, and if we compare it to the first quarter of this year - almost threefold.
The result recorded by the Central Bank was the worst since 2020, when, amid the pandemic, oil prices fell to their lowest levels since the 1990s and Russian oil producers were forced to drastically cut production.
- Rosstat reported a sharp drop in drug output in Russia. Critically dependent on imports of substances - raw materials for the production of medicines - Russian pharmaceutical factories faced sharp price increases from counterparties. While 85% of substances in Russia are imported, prices for individual substances have jumped 1.5-2 times.
- Putin demanded that scientists urgently create technologies to replace Western ones 
- VTsIOM has recorded a drop in Putin's rating to its lowest since the war began
- The Kremlin has banned doubts about the stability of the Russian economy - that's how easy and reliable it is to stabilize the economy ! 
- VTB head tells Putin about stability of Russian banks after 757 billion-ruble loss
- Russia ranks first in Europe in the number of new HIV infections. We remember Russian slogans - "AIDS is punishment for homosexuality" ! Seems to be true 

PS And about greatness

April 16, 2013: Putin demanded to get people out of slums.
September 28, 2021: Putin demanded to get people out of slums.
November 30, 2022: We need to get people out of the slums
It feels like people are going there themselves, saving themselves from a rich life in a great country

[be.open]

A bit of reality

In the meantime, here is the World Bank Group's 2022 report, July 1, 2023, GDP at purchasing power parity. What can I say, it is very shameful for the economy, twice torn to shreds, under the yoke of sanctions from all progressive mankind, to be in this list in fifth place, displacing Germany.

[armanda90]

At present, Russia's position is still a country that gets witnesses from the European Union and even the United States, but Russia's condition is far from the expectations of several great countries. Having gas sources in sufficient quantities makes Russia's position more stable and tends to be profitable because the system of exports and imports to Asian countries, which are mostly non-aligned, makes Russia's economic condition much better although it is still pending fines due to the war invasion to Ukraine. My country Indonesia, have good communicate with Russia and several time import Russia product as cheapest values than other county and more beneficial than import except Russia's product.

Invasion war to Ukraine still interested topic for discussing and reason why several European Union suspend with Russia from all sector, not only with economic side but also all kinds of Russia's sport have been banned.

[DanWalker]

~snip~

Invasion war to Ukraine still interested topic for discussing and reason why several European Union suspend with Russia from all sector, not only with economic side but also all kinds of Russia's sport have been banned.

It is the most shameful thing the US and EU have done, showing their stalemate in the war against Russia. I remember in all sports, especially football, they always uphold and uphold the spirit of not discriminating against race, color and putting politics aside to get the most fairness. But then, the US and the EU did things that were contrary to the principles and rules they had set for themselves.

And that's also why I think the establishment of BRICS is the right thing to do because we need a balance of world economic and political power. Don't let them all be controlled, manipulated by a few entities and create inequality in the world.

[Sithara007]

A bit of reality

In the meantime, here is the World Bank Group's 2022 report, July 1, 2023, GDP at purchasing power parity. What can I say, it is very shameful for the economy, twice torn to shreds, under the yoke of sanctions from all progressive mankind, to be in this list in fifth place, displacing Germany.

German industrial output was sustained primarily by cheap Russian hydrocarbons. In order to please their American overlords, the Germans cut down the very branch in which they were sitting on. Now their manufacturing companies such as BASF and Volkswagen have been forced to cut output and their profits have been reduced. On the other hand, Russian economy is doing OK. There were predictions for economic meltdown by various western experts. One and half years have passed and Russian economy is doing just fine.

[DrBeer]

A bit of reality

In the meantime, here is the World Bank Group's 2022 report, July 1, 2023, GDP at purchasing power parity. What can I say, it is very shameful for the economy, twice torn to shreds, under the yoke of sanctions from all progressive mankind, to be in this list in fifth place, displacing Germany.

1. what a selective position you have If not favorable data - "who is the World Bank - a puppet of the west". When favorable - "well, look, the World Bank itself writes, yeah !"
- And most importantly - you should have parsed the topic a bit, and understand why this information does not reflect the reality of the picture. Let me explain. Everything, where GDP is the basis, concerning Russia has a small nuance.  We know exactly what Gross Domestic Product is. Yes, yes, I know that you are talking about the derivative of this indicator, but it is not fundamental, because the problem is in the "foundation" of measurements.
So, GDP is "a macroeconomic indicator reflecting the market value of all final goods and services (i.e., intended for direct consumption, use or application) produced during the year in all sectors of the economy in the territory of a particular state for consumption, export and accumulation, regardless of the nationality of the factors of production used."

Everything seems to be good and clear. But a nuance. Almost 50% of this indicator, today Russia counts with the military-industrial complex. That is, with the production of weapons for waging terrorist wars.  These are cartridges, shells, tanks, guns, small arms, gunpowder, etc. But the problem is that all this does not benefit the economy, it is just destroyed money, because all this is soon turned into burnt, rusty iron on the territory of Ukraine. These weapons are not sold and do not bring income. Therefore, the indicator from the point of view of "positive" is highly overstated. And it is easy to check - compare inflation, price growth index (only not government prices, you understand), income growth index, and you will realize - according to the report, it is beautiful, but if you get away from the monitor and look around - everything is slowly sinking into a bad-smelling swamp. By the way, inflation - count the fall of the ruble, the lack of proportional growth of real incomes. On the one hand, the mass of worthless phantoms has grown almost several times since the beginning of a new wave of terrorism against Ukraine. On the other hand, wages have not grown during this time. No, there is indexation in a dozen percent, but +10% when the mass of money has grown many times is a weak consolation. However, the positive thing is that now everyone can count "good" GDP - there is more money

[be.open]

A bit of reality

In the meantime, here is the World Bank Group's 2022 report, July 1, 2023, GDP at purchasing power parity. What can I say, it is very shameful for the economy, twice torn to shreds, under the yoke of sanctions from all progressive mankind, to be in this list in fifth place, displacing Germany.

1. what a selective position you have If not favorable data - "who is the World Bank - a puppet of the west". When favorable - "well, look, the World Bank itself writes, yeah !"
- And most importantly - you should have parsed the topic a bit, and understand why this information does not reflect the reality of the picture. Let me explain. Everything, where GDP is the basis, concerning Russia has a small nuance.  We know exactly what Gross Domestic Product is. Yes, yes, I know that you are talking about the derivative of this indicator, but it is not fundamental, because the problem is in the "foundation" of measurements.
So, GDP is "a macroeconomic indicator reflecting the market value of all final goods and services (i.e., intended for direct consumption, use or application) produced during the year in all sectors of the economy in the territory of a particular state for consumption, export and accumulation, regardless of the nationality of the factors of production used."

Everything seems to be good and clear. But a nuance. Almost 50% of this indicator, today Russia counts with the military-industrial complex. That is, with the production of weapons for waging terrorist wars.  These are cartridges, shells, tanks, guns, small arms, gunpowder, etc. But the problem is that all this does not benefit the economy, it is just destroyed money, because all this is soon turned into burnt, rusty iron on the territory of Ukraine. These weapons are not sold and do not bring income. Therefore, the indicator from the point of view of "positive" is highly overstated. And it is easy to check - compare inflation, price growth index (only not government prices, you understand), income growth index, and you will realize - according to the report, it is beautiful, but if you get away from the monitor and look around - everything is slowly sinking into a bad-smelling swamp. By the way, inflation - count the fall of the ruble, the lack of proportional growth of real incomes. On the one hand, the mass of worthless phantoms has grown almost several times since the beginning of a new wave of terrorism against Ukraine. On the other hand, wages have not grown during this time. No, there is indexation in a dozen percent, but +10% when the mass of money has grown many times is a weak consolation. However, the positive thing is that now everyone can count "good" GDP - there is more money

Are you hinting that your point of view is not selective and is distinguished by a special objectivity in relation to Russia? Funny.

I refer to the data of the World Bank, because it is very difficult to suspect him of loyalty to Russia. And I refer to the data on GDP at purchasing power parity, because, unlike nominal GDP, it takes into account problems with national currencies and focuses on the fact that you can actually buy a ruble or euro weakened by inflation.

[DrBeer]

German industrial output was sustained primarily by cheap Russian hydrocarbons. In order to please their American overlords, the Germans cut down the very branch in which they were sitting on. Now their manufacturing companies such as BASF and Volkswagen have been forced to cut output and their profits have been reduced. On the other hand, Russian economy is doing OK. There were predictions for economic meltdown by various western experts. One and half years have passed and Russian economy is doing just fine.

 

Dear Sithara007 - you decided to follow the path of one not very smart colleague here on the forum, who here tried to tell everyone that Germany is on the verge of bankruptcy, because. "thousands of enterprises went bankrupt and closed" due to the fact that "great Russia" stopped supplying gas? And then, when it turned out that there was not a Russian audience here, and that it was customary to use brains and information here on the forum, it turned out .... It turned out that the indicators are absolutely familiar to Germany and there is no connection between these statistics and Russian economic terrorism.
And then this author was dipped head in shit, everyone at least a little bit knows how to work with information. Do not repeat his "success", this smell will accompany you for a very long time

Tell us better how the government of India buys cheap Russian oil, and then tells the population of the country tales about "expensive oil", and robs their pockets by selling them expensive gasoline? This is a really interesting observation! Or have you sharply fallen in price of gasoline?

[pooya87]

German industrial output was sustained primarily by cheap Russian hydrocarbons. In order to please their American overlords, the Germans cut down the very branch in which they were sitting on. Now their manufacturing companies such as BASF and Volkswagen have been forced to cut output and their profits have been reduced. On the other hand, Russian economy is doing OK. There were predictions for economic meltdown by various western experts. One and half years have passed and Russian economy is doing just fine.

The way China is swallowing everything in the West, in the near future nobody is going to even remember German and Japanese car brands. They've already overtaken a large part of their market by having access to energy and cheap labor.

P.S. Even funnier is when China is also swallowing US. Curiously enough nobody seems to be talking about the biggest news of past decade about Blackrock and MSCI that are slowly basically migrating to China. That is $13+ trillion dollars leaving United States
P.P.S. The funniest of all is of course the upcoming US election. Guess who are the two candidates that 300+ million Americans are forced to choose between? LOL A senile old man who can't even walk straight and an idiot who is wanted for multiple crimes of many different natures including treason and terrorism in US and outside US

[DrBeer]

Off topic, but for understanding - Saturday, 19 hours, Kyiv time. Ukraine is subjected to massive shelling from the territory of Russia, and .. Belarus. Everything you need to know about "peace initiatives" and "need to negotiate."
PS Today Belarus is becoming an official aggressor - civilian cities of Ukraine are being shelled from its territory. Outside the window, you can hear the work of anti-missile defense .....

Very inaccurate Calibers and Daggers are used to shell civilian cities

[Sithara007]

While we are discussing about Russian economy getting "imploded" (as we have been doing ever since February 2022), Urals crude is now trading above the price cap that was set by G7. As of now, Urals is trading at $69.84 per barrel (FOB prices), which is the highest level it had for a while. Last time Urals was trading at ~$70 barrel was in November 2022, when Brent crude was trading at close to $100 per barrel. Indian refineries have been forced to cut back on imports from Russia due to narrowing discounts. And still Western nations are claiming that their price cap is working and Russian economy is on its way to a meltdown.

[DrBeer]

Everything you need to know about the success of the Russian economy, and wise decisions

"The government earned a trillion on the ruble's collapse

The collapse of the Russian currency market, which raised the dollar to almost 100 rubles and the euro to above 106 rubles, has shed balm on the wounds of the Russian budget.

By the end of the year, the federal treasury will receive about a trillion rubles in excess oil and gas revenues, Bloomberg reports, citing non-public government calculations.

In January-July, every month the budget was undercollecting raw materials rent compared to this level, but in August for the first time it will receive more, the Ministry of Finance reported last week: revenues will exceed the base level by Br74.3 billion. And this trend will continue, according to Bloomberg sources familiar with the situation. It follows from their data that in September-December the budget will receive an average of 230 billion rubles of excess revenues every month."

I.e. the budget revenues are obtained due to...no no no no, not the growth of the MIC. At the expense of inflation growth ! )))

https://www.moscowtimes.ru/2023/08/07/pravitelstvo-zarabotalo-trillion-na-obvalnom-padenii-rublya-a51269

[Sithara007]

^^^^ One of the rare occasions when the government would prefer a devaluing national currency. What is happening here is that Russian government receives most of the foreign revenues in the form of USD or CNY. But their expenses (including salaries and pensions) are being paid out in Russian Rubles. So a devaluing Ruble is preferable to the Russian government. In the end, the common people will suffer since their expenses will go up from inflation. But for the short term, the government would prefer the national currency losing its value.

[Wimex]

It's been over a year since the war began and it's quite shocking that the war has lingered this long. No one predicted the longevity of the war. But this is where we are and as it seems with all the unfolding drama the war has brought to the Russian economy and military, things might longer than we expect.

Looking at the effect the war has had on the Russian economy, I think it all struggled at the inception of the sanctions placed on them by the U.N, U.S, U.K and other powerful countries. However, things have flipped dramatically in favour of the Russian government to some extent as they have been able to form some sort of economic alliance with top energy producers globally including China and Saudi Arabia. These moves have to control favour the Russian government in the area of energy supplies and this stabilised the Russian economy.

More interesting developments may unfold. So, let's expect more twists...

Actually predicted this to drag out for long until one side relents and quits cause there's no way they'd both give up their stands. Russia's living in their delusional world where they think Ukraine's still part of them while of course the now sovereign state of Ukraine is fighting for their freedom. Economy can wait, they have allies that will help them fund and further their battle, plus at this point in time Russia's already forcing a huge portion of their male population to sign up to this needless war, so manpower wouldn't be a problem to them.

Just a few months ago I saw some news about Saudi buying Russian Gold, there's that too, plus a country which I forgot was also found to be financing the war on the side of Russia, there's a lot of things that are causing this war to drag out this long, it's not a matter of when they would stop, it's a matter of how.

I really don't understand why countries promote wars so much, even though the attacker may benefit from it, they create a lot of shortages, famine, harm both their citizens and those on the opposite side, that is where he asked me that is the humanity that we have?, everything is really based on money, because during this confrontation, for example, the arms trade moves a lot, or the foundations that are supposedly in charge of helping the harmed, but i am sure that those in charge of that also take taking advantage of it, they don't give everything they collect, and there are many more organizations of this type that use these events to obtain profit... making them see as if they were necessary. and also, touching on another point that i think is important to take into account with the war between Russia and Ukraine, is that despite the sanctions imposed on Russia, this country is considered one of the world powers and distributes essential products to the majority of their neighbors, so as such, those who are isolated from the conflict have to ignore these sanctions and continue buying said goods, Thus prolonging the war by not contributing to the pressure for them to settle.. thus remaining stable in a certain way, said country.

[Sithara007]

I have some sobering news for those who believe that the Russian economy is about to "implode". Urals FOB prices are at all-time high. Last week, FOB price at Novorossiysk was $73.57 per barrel, which represents a discount of just $14.80 per barrel to benchmark Brent. And this is well above the G7 price cap of $60 per barrel. Freight rates have also decreased, making it profitable for importers to chose for Russian crude. Russian diesel was trading at $108.98 per barrel, which is again well above the price cap. The freight cost from Russia to India has now declined to just $4.5 per barrel.

 

[DrBeer]

News from the most stable economy that is backed by expensive oil )))

The Bank of Russia is considering the return of strict currency control measures to stop the collapse of the ruble.

At a meeting on Tuesday, the Central Bank's board of directors discussed the introduction of mandatory sale of foreign currency earnings by exporting companies, Bloomberg reported citing four sources familiar with the situation.

Three Interfax sources, directly involved in the discussion, say that almost all foreign currency earnings - up to 90% - may fall under the rule of compulsory sale. Such measures were discussed on Monday at a meeting with the participation of major exporters, the government and the Central Bank.

PS For information: in Ukraine during the most difficult time, after the beginning of Russian aggression, there was also a forced sale of currency. I work under contracts with the EU, and my business is paid in Euros. So there was a period when I was selling 50% of my currency receipts. But... this provision of the law has long been canceled. And we don't have oil, gas, "40% of the world's natural resources".

I have some sobering news for those who believe that the Russian economy is about to "implode". Urals FOB prices are at all-time high. Last week, FOB price at Novorossiysk was $73.57 per barrel, which represents a discount of just $14.80 per barrel to benchmark Brent. And this is well above the G7 price cap of $60 per barrel. Freight rates have also decreased, making it profitable for importers to chose for Russian crude. Russian diesel was trading at $108.98 per barrel, which is again well above the price cap. The freight cost from Russia to India has now declined to just $4.5 per barrel.

Dear Sithara007 !
Are you familiar with such a concept as "cognitive dissonance" ?
I will tell you by example - if someone says that the Russian economy is stable, oil is sold in huge volumes, and its price is "exorbitant", but at the same time in reality the ruble is flying into the abyss, budget revenues in currency have fallen by half. This is exactly about "cognitive dissonance"

And let me remind you again, although I see you just try to reject this fact, because it breaks your fictitious story about stability: 90%+ of the terrorist country's oil is bought by India. China has already refocused on Iraqi oil. India buys for 2 reasons: cheap and can buy for ... RUPIES !
So don't write about high price in dollars, it doesn't exist. It is on papers, but all settlements for oil India makes in RUPIES And rupees are not dollars, by the way dollars - for which India forbade russia to change its rupees

[serveria.com]

At a meeting on Tuesday, the Central Bank's board of directors discussed the introduction of mandatory sale of foreign currency earnings by exporting companies, Bloomberg reported citing four sources familiar with the situation.

Three Interfax sources, directly involved in the discussion, say that almost all foreign currency earnings - up to 90% - may fall under the rule of compulsory sale. Such measures were discussed on Monday at a meeting with the participation of major exporters, the government and the Central Bank.

Yes, and that's a logical decision. While the country is being artificially prevented from receiving USD and EUR, some companies probably have quite a lot of foreign currency accumulated from export deals. I don't see how this news can be negative or shameful for Russia.

PS For information: in Ukraine during the most difficult time, after the beginning of Russian aggression, there was also a forced sale of currency. I work under contracts with the EU, and my business is paid in Euros. So there was a period when I was selling 50% of my currency receipts. But... this provision of the law has long been canceled. And we don't have oil, gas, "40% of the world's natural resources".

Yeah, who needs oil, gas, other resources and all that crap when you can receive foreign financial aid for free?    Since the beginning of 2023 and up to May Ukraine has received hundreds of billions in financial support! US alone has injected a whopping $71 billion, EU about $35 billion! About 40% (now possibly even more) of Ukraine's budget is being sponsored by the West.

https://www.statista.com/statistics/1303432/total-bilateral-aid-to-ukraine/

I have some sobering news for those who believe that the Russian economy is about to "implode". Urals FOB prices are at all-time high. Last week, FOB price at Novorossiysk was $73.57 per barrel, which represents a discount of just $14.80 per barrel to benchmark Brent. And this is well above the G7 price cap of $60 per barrel. Freight rates have also decreased, making it profitable for importers to chose for Russian crude. Russian diesel was trading at $108.98 per barrel, which is again well above the price cap. The freight cost from Russia to India has now declined to just $4.5 per barrel.

Dear Sithara007 !
Are you familiar with such a concept as "cognitive dissonance" ?
I will tell you by example - if someone says that the Russian economy is stable, oil is sold in huge volumes, and its price is "exorbitant", but at the same time in reality the ruble is flying into the abyss, budget revenues in currency have fallen by half. This is exactly about "cognitive dissonance"

And let me remind you again, although I see you just try to reject this fact, because it breaks your fictitious story about stability: 90%+ of the terrorist country's oil is bought by India. China has already refocused on Iraqi oil. India buys for 2 reasons: cheap and can buy for ... RUPIES !
So don't write about high price in dollars, it doesn't exist. It is on papers, but all settlements for oil India makes in RUPIES And rupees are not dollars, by the way dollars - for which India forbade russia to change its rupees

Well, that's a lie! A portion (eventually becoming bigger) of all trade is being performed in Chinese yuan. Initially, the share of yuan was around 10% but it's getting bigger and bigger eventually.

Source: https://www.reuters.com/business/energy/india-refiners-start-yuan-payments-russian-oil-imports-sources-2023-07-03/

[coupable]

~snip~

Invasion war to Ukraine still interested topic for discussing and reason why several European Union suspend with Russia from all sector, not only with economic side but also all kinds of Russia's sport have been banned.

It is the most shameful thing the US and EU have done, showing their stalemate in the war against Russia. I remember in all sports, especially football, they always uphold and uphold the spirit of not discriminating against race, color and putting politics aside to get the most fairness. But then, the US and the EU did things that were contrary to the principles and rules they had set for themselves.

The aim is to isolate Russia in the first place, with the aim of influencing it to change its positions. And I support this position if it had real results in reality, but we notice that the Russian government does not care about these measures and continues its policies of obstinacy, indifferent to the direct impact of this on its people in its various segments, especially those outside Russia.
At the same time, I find that it is an absurd measure, since it did not achieve results in previous experiences with Iran, for example, or Israel, since preventing it from major international events did not deter it from the atrocities it is carrying out.