Economic Growth in Modern Russia

Russia today is much richer country than it was

at any time since the Soviet collapse.

Now, I went to Moscow in June. I haven't been to

Moscow since 2019, and I was able to talk to

people at many levels. I spoke to waiters, I spoke to

taxi drivers, I spoke to workers at a bread factory,

and the one

thing that I got from all of them was that there has

been a very, very big upswing in the Russian economy.

Russia has become richer.

It become much richer, and the single biggest

reason why there has been this economic upsurge is

because Western sanctions are preventing Russian

money leaving, because when it was an exporter

of raw materials, the money that was made from the export of those

was then transferred to the West. It went into

Western financial institutions, Western banks.

It was invested in building properties in London.

Because for all kinds of reasons, Russians didn't trust their

own financial system. Now they can't take money

out, so it has to stay there, and money doesn't

like to remain idle, so it has to be put to use.

Western businesses left. Russian businesses stepped in.

They are investing inside Russia, and that meant that a very large

domestic market was created, which in turn

triggered very rapid industrialization.

The-

Because of also cheap oil and all this stuff.

Cheap oil, cheap energy, the fact that Russia does not have

a massive stock market, the whole financial system

is much more focused therefore on spending

money to increase production, and there has been a major

upsurge that manufacturing is rising.

Parts of the service economy are growing alongside it, and you

can see this with shops and restaurants and all of these kind of

things

developing in all kinds of ways. E-commerce has

expanded to a degree that is completely beyond my

imagination. Consumer goods far more widely available.

Cost of living has fallen, not because inflation hasn't

fallen, but because real incomes have risen much

faster,

and the government is facilitating all of these processes

through

the tax system, and it's also creating a

digital infrastructure to support them.

But we in the West, obviously what we are confronted with

mostly is our own propaganda, that a lot of these

analyses about the situation are made in the abstract without

actually going there and seeing the reality of what is

going on in Russia now.