By Ekaterina Zolotova
In a recent interview, Russian President Vladimir Putin said the Russian economy had overcome some significant challenges over the past several years, namely Western sanctions imposed after Russia’s annexation of Crimea and the global slump in oil prices. According to Putin, inflation is the lowest it has been in modern Russian history, gold and foreign reserves are growing, economic growth is slowly rising and foreign direct investment is increasing. The effects of Western sanctions appear to be easing. In 2015, Russian gross domestic product declined by 1 to 1.5 percent due to sanctions. In 2017, this number declined to 0.5-1 percent.
If the Russian economy really is recovering, it would give Russia a better negotiating position when it comes to the conflict in eastern Ukraine and would diminish some of the leverage the West gained through sanctions. We previously forecast that Russia couldn’t afford to be isolated from the global economy any long
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