Remember “stagflation,” the knight in shining economics that slew the USSR dragon? It’s back with a vengeance. Russian GDP growth has fallen consistently for the past two years; the pattern has continued for the first two quarters of this year. Even Kremlin mouthpiece Russia Beyond the Headlines admits the dire reality:
Energy prices were the only reason why Russia avoided a recession trough [so far]. Despite all the promises, or, to use the government’s rhetoric, “strategic plans” to reduce oil sales proceeds to 5.6 percent of GDP, its share is still at least double that.
Ksenia Yudaeva, Putin’s representative to the G-20, now says that Russia is probably already in a recession.