©Sputnik/Ivan Sekretarev
The Russian economy is growing more quickly than those of other major global powers and is doing so without a reliance on oil and gas, President Vladimir Putin said on Friday.
Speaking at the plenary session of the St. Petersburg International Economic Forum (SPIEF), Putin noted that Russian GDP expanded by 3.6% last year, bouncing back from a 1.2% downturn amid Ukraine-related sanctions in 2022. This year the economy has continued to expand, the president stated.
“For the first quarter of this year, growth reached 5.4%. That is, our growth rates exceed the world average,” Putin said. He also pledged significant structural changes to achieve “a new quality and content of economic growth in Russia.”
Putin said the trend stems largely from non-resource-based industries. According to the Russian leader, in 2023 over 40% of GDP growth came from basic industries such as manufacturing, construction, logistics, communications, and agriculture, while some 60% was from supporting industries such as trade, hospitality, and financial services.
He noted that Russia had set a goal of joining the four largest global economies, and had apparently achieved this. According to World Bank estimates released last week, Russia now ranks as the world’s fourth biggest economy based on purchasing power parity, surpassing Japan and Germany. However, according to Putin, the country must not ease off with its efforts to develop the economy even further.
“I would like to note that it is not a matter of GDP estimation and calculation systems… We are somewhere nearby: Russia, Germany, Japan – the difference is small. We are ahead, but the difference is small,” Putin said. It is now vital to “ensure consistently high rates and quality of growth in the long term” to maintain Russia’s position, he added.
Russia has faced multiple rounds of Western sanctions since the start of its military operation against Ukraine in February 2022. The measures have ranged from blacklisting most Russian banks and cutting them from the international SWIFT interbank messaging system, to freezing some $300 billion in Russian foreign exchange reserves. Many analysts have attributed Russia’s steady economic growth in the face of these challenges to its timely pivot to markets in Africa, the Middle East, and Asia, as well as fiscal changes adopted by the country’s financial authorities.
The International Monetary Fund (IMF) in April said it expects the Russian economy to grow faster than all advanced economies in 2024. According to its projections, the country’s GDP is forecast to expand by 3.2%, exceeding the expected growth rates for the US (2.7%), the UK (0.5%), Germany (0.2%) and France (0.7%). Russian Finance Minister Anton Siluanov earlier said he expects GDP growth in 2024 to equal that of last year, while the Bank of Russia has put it at 2.5-3.5%.
Russia Remains Key Player in Global Trade Despite All Obstacles, Sanctions - Putin
Russia remains one of the main participants in world trade despite all obstacles and sanctions, Russian President Vladimir Putin said on Friday.
"Despite all the obstacles and illegitimate sanctions, Russia remains one of the key participants in world trade and is actively developing logistics and the geography of cooperation. Thus, our relations with Asian countries are strengthening," Putin said at the plenary session of the St. Petersburg International Economic Forum (SPIEF).
Countries that are friendly to Russia account for three quarters of its trade, the president said, adding that Russia also ensures a balance of interests of all participants in trade with the Eurasian Economic Union.
Russia is ready to offer full-scale technological partnerships to other countries, the leader said.
Putin also called developing the Eastern Rail Range network one of the main tasks for Russia.
"At the Eastern direction, towards China and countries of the Asian Pacific region, the main project for us is developing the so-called Eastern Rail Range. In April, the parameters of another, already the third stage of its modernization, were finalized. By 2030, the capacity of the Eastern Rail Range should increase to 210 million tonnes, and by 2032 [it should increase] to 270 million tonnes," Putin told the forum.
The development of new markets requires new transport connections, the Russian president continued.
"Special attention will also be paid to the Southern direction. The development plans for the North-South international transport corridor as well as the corridor in the Azov-Black Sea direction have been adopted," he said.
The Russian city of St. Petersburg is hosting the 27th edition of SPIEF from June 5-8. Last year, the forum drew 17,000 participants from 130 countries and saw the signing of more than 900 agreements.
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