Russia dismisses economic crisis claims, cites strong growth

Russia’s Minister of Economic Development, Maxim Reshetnikov, has rejected Western assertions that the country is facing an economic crisis, arguing that strong growth, rising incomes and a shift toward domestic demand have made the economy “more sustainable and balanced.”

Speaking to The National at the St. Petersburg International Economic Forum, Reshetnikov said: “I don’t know what you mean by crisis. Over the last three years the growth of the Russian economy has been more than 10 per cent.”

He acknowledged that inflation had accompanied recent growth, noting that the government’s current priority is to bring price increases under control. “Now the main task is to lower inflation, so the real key rate is quite high and, of course, that couldn’t help but affect our growth,” he said.

The minister revealed that Russia’s 2026 budget is based on an assumed Urals crude price of $59 per barrel. When prices exceed that level, additional revenues are transferred to the National Welfare Fund; when they fall below it, reserves are used to cover budget shortfalls.

Reshetnikov argued that Russia’s economic model has become increasingly driven by domestic demand. “The main source of growth has become internal, not external. Our internal demand, the consumption of the population and the state, and investment, those are the main resources,” he said.

He also highlighted a strong rouble, attributing it to robust exports, reduced imports and limited capital outflows. “Our businesses now use more roubles, even for investment, for savings and in foreign trade,” he said.

Addressing living standards, Reshetnikov cited growth in real incomes and dismissed claims that Russians are struggling financially. “Last year, there was a very big jump in people’s income, in real income,” he said.

The minister said Russia is adapting to a more fragmented global economy and a multipolar world. “Our growth is moderate now, but our development has become more sustainable and more balanced,” he said.

By Vafa Guliyeva