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HomeUncategorizedThe Russian economy may take 10 years to return to pre-sanctions levels

The Russian economy may take 10 years to return to pre-sanctions levels

The CEO of Russian bank Sberbank said that if nothing was done before the sanctions, Russia could take 10 years to bring the economy back to the level of 2021.

Sberbank CEO German Gref on June 17 estimated that countries imposing sanctions on Russia contribute 56% of exports and 51% of imports to Moscow. “This is a threat to 15% of Russia’s GDP,” Gref said during the annual international economic forum held in St. Petersburg. “The result is that if we do nothing, we could lose a whole new decade.” bring the economy back to the level of 2021.

He said that the amount of goods exported decreased by up to six times. Sea and air transport were also hampered as sanctions prevented Russian airlines from flying to the West. Ships flying the Russian flag are also banned from entering European ports.

Sberbank ceo german gref. Photo: reuters

Sberbank CEO German Gref. Image: Reuters

During the forum, he also called for structural reform of the economy. Gref served as Russia’s Minister of Economy. The bank he leads – Sberbank – is considered a benchmark for the Russian economy, as it holds most of the savings deposits of Russian families and loans to Russian businesses.

The West began to impose sanctions on Russia after it launched a military operation in Ukraine on February 24. Russian assets were affected immediately. The consumer price index skyrocketed, prompting authorities to impose capital controls, raise interest rates and restrict foreign investors from selling assets in Russia.

Sanctions make it impossible for Russian banks to deal with foreign banks. Russia is also banned from buying necessary equipment and parts for cars, energy and aviation.

While acknowledging major challenges, Russian officials say the economy is performing better than initially expected. Rising fuel prices and more diversified trade flows have helped improve the national budget.

Also in the forum, Alexander Dyukov – leader of the third largest oil company in this country Gazprom Neft said that Russia is shifting its oil sales to Asia. Dmitry Pankov – leader of Delo Group – which runs Russia’s leading rail carrier Transcontainer also said that Asian tourists are starting to appear more. “They’re not global companies, they’re mostly local businesses,” he said.

Ha Thu (according to Reuters)

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