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Ex-Finance Minister: Russian Share of Global Economy Shrinking


Russian 5,000 ruble bill, equal about 88 U.S. dollars.
Russian 5,000 ruble bill, equal about 88 U.S. dollars.
Alexey Kudrin, ex-Minister of Finance of Russia, Director of the Civil Initiatives Committee

Alexey Kudrin, ex-Minister of Finance of Russia, Director of the Civil Initiatives Committee

“Prior to the sanctions, Russian economy was showing low growth. The median growth in 10 years (since 2007) was 1%. We are shrinking our role as a global economy.”

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In four recent years, Russia’s role as a global economy has shrunk to the early 2000 levels

In 2017 Russia’s economic growth, based on Rosstat’s first estimate, equaled 1.5% or a quarter less the government’s recent forecasts. It is only slightly better than the pre-2013 crisis trends.

However, if we disregard growth declines of the last three financial crises in the country, these growth rates turn out to be minimal in the last 20 years. At the same time, the global economy is demonstrating growth rates almost 2.5 times higher:

20 years of Russian and Global Economic Growth, % in comparison with previous year; Source: IMF (2017-world-forecast), Rosstat
20 years of Russian and Global Economic Growth, % in comparison with previous year; Source: IMF (2017-world-forecast), Rosstat

Russia’s exact place in the global economy depends on the way the growth of its Gross Domestic Product (GDP) is calculated. Converted into U.S. dollars at the current exchange rate, based on the International Monetary Fund’s (IMF) estimate, Russia is outside of the first top ten countries:

15 Top World Countries in GDP based on local currency exchange roles, in %, for 2017; Source: IMF
15 Top World Countries in GDP based on local currency exchange roles, in %, for 2017; Source: IMF

Looking at the Purchasing Power Parity (PPP) in national currency (by doing price comparison of the same goods and services in different countries), the group of leading countries, according to the IMF, looks different. In 2014, it was led by China ahead of the United States. Russia took the sixth place.

We have put both numbers together in one graph that demonstrates how Russia’s contribution to global GDP has been changing since the beginning of the new century. This is exactly what the ex-Minister of Finance was talking about:

Russia's Contribution to Global Economy in %, 2000 - 2018; Source: IMF
Russia's Contribution to Global Economy in %, 2000 - 2018; Source: IMF

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