Russian economy grows again after four quarters of contraction

Vladimir Putin Digital Ruble
Russian President Vladimir Putin delivers his speech at a ceremony to mark the 75th anniversary of Russian Federal Medical-Biological Agency in Moscow, Russia, Wednesday, Nov. 9, 2022. (Sergei Bobylev, Sputnik, Kremlin Pool Photo via AP)

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For the second quarter of 2023, the Russian economy obtained a growth of 4.9%. However, it has not yet reached its level prior to the military offensive against Ukraine in 2022.

The Russian economy grew 4.9% year-on-year in the second quarter of 2023, its first positive result since the beginning of 2022, according to data published this Friday by the national statistics agency (Rosstat).

The country’s Gross Domestic Product (GDP) had chained four successive quarters of contraction in the middle of the Ukraine conflict. In the first quarter of this year, the decline had been 1.9% compared to the same period in 2022.

The 4.9% growth in the second quarter of this year contrasts with the 4.5% collapse in the same period in 2022, when the Russian economy was hit by a series of sanctions imposed by Western powers, in response to the military offensive in Ukraine.

Despite having come out of the red, the Russian economy has not yet reached its level prior to the start of that conflict, in February 2022.

The Rosstat statement does not break down growth in the second quarter by activity sectors.

In this period, the country recorded a rise in inflation, due to the devaluation of the ruble in the context of decreased income from the sale of hydrocarbons.