Russia’s Economy Surges in 2024 Despite Global Pressures

In 2024, Russia's economy shows robust growth, surpassing expectations with a 5% GDP increase in the first five months.

Prime Minister Mikhail Mishustin highlighted this progress, noting a slight acceleration in growth to 4.5% in May. The manufacturing sector, driven largely by machine building, expanded by nearly 9%, supported by a 15% rise in investments in machinery, equipment, and intellectual property by the end of the first quarter.

Companies are reinvesting profits, and regional investments are intensifying, contributing to long-term economic stability, according to Mishustin. Despite strong consumer activity bolstered by rising incomes, inflation reached 4.5% by July 1, prompting close monitoring in collaboration with the Bank of Russia.

Russia’s oil revenue surged nearly 50% in June 2024 compared to the previous year, attributed to successful adaptations to Western sanctions, particularly with its flagship Urals crude oil. Moscow’s oil-related tax revenues also saw a substantial increase, reaching 590.6 billion rubles from 402 billion rubles in June 2023.

President Vladimir Putin recently approved tax amendments aimed at fostering a balanced tax system, following a budget deficit in 2023 amounting to around 3.2 trillion rubles or 2% of GDP. These changes were passed by Russia’s parliament earlier this week under Finance Minister Anton Siluanov’s guidance to ensure fairness.