Russian President, Vladimir Putin has urged his economic officials to take advantage of opportunities arising in the global economy from market turbulence and intensifying trade wars.
Russia, whose trade with the United States and European Union has fallen sharply due to sanctions imposed over its ongoing war in Ukraine, has not suffered from the US tariffs on many countries announced by US President, Donald Trump.
Russia’s economy has performed better than it expected during the three years of conflict despite sanctions, but the country is now bracing for a protracted period of lower oil prices – its main export – and declining budget revenues.
“The global economic situation is becoming more complicated as commodities and financial markets experience significant fluctuations due to intensified global competition.
“It is necessary not only to monitor these factors and predict their changes but also to use the emerging opportunities to develop domestic production, trade relations and exports to strengthen the national economy as a whole.”
Vladimir Putin
The comments were Putin’s first on the global economic situation since the US tariffs were announced.
Also, the Russian President disclosed that growth of the national GDP totaled 1.9% annually in January-February 2025. “The processing industry is growing more actively at the same time – plus 5% over the first two months of this year,” Putin said.
He added that Russia should provide for “stable rates of economic growth with simultaneous reduction of inflation and low unemployment rate maintained.”
On Tuesday, Kremlin Spokesman, Dmitry Peskov said in an interview that Russia has learned to cope with Western sanctions, while for the EU they create big problems.
According to him, Europe needs “cheap security and cheap energy” to keep its high global standing. “It got security from the United States for a small price. And cheap energy from Russia,” Peskov added.
He noted that the EU is currently deprived of both the former and the latter.
At the same time, the Kremlin Spokesman emphasized that sanctions are a “double-edged sword, hurting both Russia and those who imposed them.”
Russia’s Central Bank To Decide Benchmark Interest Rate
Putin’s meeting with officials took place one day before the central bank’s board meets to decide on its benchmark interest rate, which is currently at 21% – its highest level since the early years of Putin’s rule.
Both the central bank and the finance ministry, whose heads attended the meeting with Putin, warned about the consequences of global turbulence on the Russian economy.
Finance Minister Anton Siluanov said on Wednesday that Russia needs to boost its fiscal reserves to ensure at least a three-year coverage of budget spending if oil prices remain low for an extended period.
Putin acknowledged that budget spending had surged by 25% in the first quarter but said it was done intentionally to ensure that all recipients of budget funds received their money on time.
Russia has cut its forecast for 2025-2027 oil and gas export revenues, a key source of funding for the state budget, due to weaker oil prices, expecting proceeds to fall by 15% this year, according to an economy ministry document seen by a news agency.
The country’s economic growth is set to slow to at least 2.5% this year from 4.3% in 2024, in what Putin described as a “soft landing,” saying it was part of the plan to fight inflation, which is still running above 10%.
The Russian central bank warned this month that oil prices could be lower than forecast for several years due to reduced global demand. The previous board meeting took place on March 21, before the U.S. tariffs were imposed.
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