The government of the Russian Federation expresses concern over the state of the national economy, noting a significant slowdown in growth rates. The Minister of Economic Development of Russia, Maxim Reshetnikov, reported that in July, the country’s GDP growth decreased to 0.4% year-on-year. In comparison, this figure was 1.1% in the second quarter and 4.3% at the end of last year.
This is reported by Business • Media
Negative GDP Dynamics and Forecast Adjustments
The Russian government has already been forced to revise its economic growth forecast for 2025 downwards twice in the past week. Initially, GDP growth was expected to be at 2.5%, but this figure was first lowered to 1.5%, and later to 1.2%. Such changes indicate the seriousness of the economic challenges faced by the Russian Federation.
Increasing Budget Deficit and Government Position
At the same time, Vladimir Putin, during his speech at the Eastern Economic Forum in Vladivostok, attempted to downplay the scale of the problems, stating that the increase in the Russian budget deficit is not critical due to the low level of government debt. According to the Russian Ministry of Finance, the federal budget deficit for the first seven months of the year reached ₽4.9 trillion, which is 340% higher than the same figure last year. Budget expenditures increased by 21% to ₽25.19 trillion, while revenues grew by only 3% to ₽20.32 trillion.
The Russian government notices “alarming signs” in the economy, which is “cooling down” faster than expected, stated the Minister of Economic Development of Russia, Maxim Reshetnikov.
Putin also dismissed claims of economic stagnation in Russia previously made by the head of Sberbank, Herman Gref.
Moreover, the deputy head of the Russian presidential administration, Maxim Oreshkin, expressed the opinion that Western sanctions have a positive impact on the Russian economy, as they stimulate the search for new opportunities for development. According to him, BRICS countries and the Global South currently occupy a key place in global trade, while traditional alliances are losing their significance.