Russia’s economy: On the edge of recession

Posted: October 3, 2014 in economy
Tags: , ,

UK Only Article: 
standard article

Issue: 

The Party v the people

Fly Title: 

Russia’s economy

Rubric: 

The West’s sanctions are hitting a contracting economy

Location: 

MOSCOW

Main image: 

Igor Sechin (right) is calling in a favour

SIGNS of Russia’s economic problems appeared long before the annexation of Crimea or the war in the Donbas region in Ukraine. The country’s previous growth model, in which profits from oil and gas sales were funnelled into the consumer economy, petered out around the time Vladimir Putin returned to the presidency in 2012. But Mr Putin in effect rejected a new model, based on innovation and investment, because of its troublesome political implications.
This state-imposed stagnation is made much worse by the combined effect of the West’s sanctions, a lack of access to financing, capital flight and a climate of uncertainty, which is locking Russia into a sustained period of near-zero growth. The economic …

via Economic Crisis http://ift.tt/1tkeWoe

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