Russian Economy Slows to Weakest Growth Since 2009 Slump
It would seem that as the European Union falls, Russia is falling along with it. Given that more than half of the trade that occurs in Russia involves the E.U., it is only natural that the E.U.’s recession is harming Russia’s economy. The demand for Russian goods and commodities has plummeted. The Finance Minister has noted that at the current rate of growth, Russia is actually in a state of stagnation.
Unfortunately, it would seem that Russia is reaching for unrealistic goals, unable to even tell that the country can not grow at the 5 percent rate that Prime Minister Dmitry Medvedev wants. “There’s ‘virtually no chance'” of even reaching 3.6 percent according to the Deputy Finance Minister.
I never really took the time to look at Russia and its economy, but now I see that it is mostly crippled by the E.U.’s decline. If the global economy is weak, it would seem that Russia’s main sources of growth, like steel exporting, are forced to a standstill. If the E.U. continues the path of stricter austerity measures,the outcome does not bode well for Russia. Russia is already suffering due to the cuts in spending, but if the cuts are increased, Russia could end with little to no growth at all, given that current estimates place growth at under 2 percent already.