Russian economic growth in the third quarter of this year was 1.3%. While the economy is recovering, growth is very low. Where the country’s government is willing to make policy, it does so very responsibly. When it comes to fiscal and budgetary policy, its approach is both disciplined and orthodox. Indeed, the government budget is rapidly approaching surplus.

However, while fundamental issues around corruption, rule of law, and judicial independence (amongst others) endure without being addressed, the country’s potential growth will remain stifled. Until they are addressed, the economy will continue to be susceptible to factors beyond the government’s control, commodity prices for example.

Quarterly GDP Growth Rate of Russian Federation

Source: OECD National Accounts Statistics.

About the Author:

Tom Butcher is Director of Communications at VanEck. Formerly an independent writer, researcher, and consultant focusing, amongst other things, on strategic materials, in particular metals, Mr Butcher has 39 years of experience in finance. He has lectured and spoken at conferences around the world.

The article above is an opinion of the author and does not necessarily reflect the opinion of MV Index Solutions or its affiliates.