Russian President Vladimir Putin attends a meeting with US President Joe Biden at Villa La Grange in Geneva, Switzerland, June 16, 2021.
SPOUTNIK | via REUTERS
Love him or hate him, there is no doubt that Russian President Vladimir Putin has helped keep Russia firmly on the global geopolitical stage during his tenure.
Alternating as both Prime Minister and President of Russia since late 1999, Putin has been a leading figure in the Russian economy seeking to attract foreign direct investment, stimulate a variety of industries and exploit the natural resources of the country. Russia, especially the country’s abundance of oil and gas.
Of course, it was not all easy. Russia has been hit by economic woes both on its own initiative – such as international sanctions imposed on key sectors after its annexation of Crimea to Ukraine in 2014 and its interference in the 2016 US elections – and some over which it had no control, such as the 2008 financial crash, 2014 oil crash and, more recently, the Covid-19 pandemic.
More than 20 years after Putin’s accession, Russia – a country stretching from Europe to Asia and with a population of around 144 million – faces challenges that the Kremlin will have to address soon enough.
These range from the more pressing issue of living standards and the specter of inflation that could hit Russian consumers in times of vulnerability, to longer-term issues such as Russia’s transition out of its dependent economy. energy and export oriented.
Tourists walk along Red Square in front of Saint Basil’s Cathedral in Moscow on November 6, 2020.
ALEXANDRE NEMENOV | AFP | Getty Images
CNBC examined economic data from the Organization for Economic Co-operation and Development that spanned Putin’s two decades in power, looking at the country’s growth rate, GDP per capita, employment situation, and inflation. as well as household disposable income compared to its neighbors in the EU, the wider OECD (which includes 38 countries around the world) and the United States
Russia’s economic growth
Russia’s economy undoubtedly grew under Putin, although it plunged deeper than others after the 2008 financial crisis, as this graph shows.
The recession that Russia entered after the 2014-2016 oil crash (when oil prices fell from around $ 114 a barrel to $ 25 in early 2016) is also evident, as is the damage caused by the pandemic in Africa. GDP, Russia no longer being immune to blockages. , industry shutdowns and falling demand for oil than the rest of the world. However, its decline has not been as pronounced as that observed collectively in the EU or the OECD.
The Tor icebreaker (right) at the port of Sabetta on the Kara Sea coast on the Yamal Peninsula in the Arctic Circle, some 2,450 km from Moscow.
Kirill Kudryavtesev | AFP | Getty Images
This chart below shows Russia’s GDP per capita, a basic indicator of economic performance and commonly used as a general measure of average standard of living or economic well-being.
The rise in consumer prices has been a regular scarecrow for the Russian economy and inflation has been a focal point for Russia’s central bank in recent years, especially following the oil crash when the value of the Russian ruble fell against the US dollar, increasing inflationary pressures.
Currently, Russia’s inflation rate stands at 7.4%, a figure that prompted the central bank to raise interest rates by 25 basis points to 6.75% in September. The bank’s inflation target is 4%.
The central bank noted last month that while the Russian economy “returns to a balanced growth path … the contribution of persistent factors to inflation remains substantial.” In this environment, the risk balance for inflation is tilted upward, the bank said.
A hairdresser wearing a face mask and gloves combs the hair of a client on October 6, 2021 in Moscow, Russia.
Mikhail Svetlov | Getty Images News | Getty Images
Disposable household income was strongly impacted by runaway inflation during the 2014-2016 oil crisis period, but the latest available data show that Russia has recovered in this indicator, with the annual growth rate of the country. household disposable income, in 2019, at a very similar level in the United States
Russia performs well in terms of employment indicators, and in fact performs much better than its peers in the EU and the OECD, with its employment rate above the average for countries in the OECD and an unemployment rate below the OECD average.
“Flexible labor market legislation, weak unemployment insurance and the ongoing economic recovery are reducing unemployment,” the OECD said in a 2018 report. Yet Russia scores relatively low on quality indicators of employment, with income quality close to the lowest of OECD countries.
Employees of the Russian factory in Mikron manufacturing microchips for electronic passports.
Alexandre Ryumin | TASS | Getty Images
It also scores below the OECD average in the main inclusion indicators, with the employment gap higher for disadvantaged groups, such as mothers with children, young or older workers, and workers. disabled or non-Russian workers, compared to OECD countries.
– CNBC’s Hadley Gamble hosts a panel with Russian President Vladimir Putin and CEOs of BP, TotalEnergies, ExxonMobil and Daimler at Russian Energy Week. Watch live at 1:00 p.m. Moscow time / 11:00 a.m. London time on Wednesday, October 13.