Balanced financial policy and crisis management experience have helped Moscow withstand unprecedented pressure, Elvira Nabiullina has said
The Russian economy has demonstrated its sustainability and resilience by weathering an unprecedented barrage of Western sanctions defying even the worst expectations, the head of the Bank of Russia, Elvira Nabiullina told the State Duma on Wednesday.
The level of pressure Russia had to face last year was so high no one could have potentially predicted it or prepared for it beforehand, the central bank head believes. The Russian people and industries demonstrated remarkable adaptability in this new reality, she said.
“No one could have prepared for this insane onslaught of sanctions,” Nabiullina said, adding that external conditions for the Russian economy had been worse than “even the most pessimistic scenario.” The “balanced and unwavering policy” the Russian financial authorities have stuck to in previous years as well as “crisis management experience” are what helped the government react to developments effectively, she explained.
The central bank head particularly praised the work of the nation’s banks that kept the financial sector “stable” and provided the nation with the necessary financial resources. She also described the government support measures as “adequate and timely,” adding that they helped the economy to “weather the sanctions storm.”
Russia has faced unprecedented sanctions imposed by the US and its allies last year over Moscow’s decision to launch a military operation in neighboring Ukraine. The Russian financial system and banks, as well as the aviation and space industries were among the first to be impacted.
The US and the EU have introduced a total of ten rounds of sanctions over roughly a year while the conflict between Moscow and Kiev has raged. In December, the EU, along with the G7 countries and Australia, introduced a price cap on Russian seaborne oil, set at $60 per barrel.
Many Western officials and media outlets predicted that the Russian economy would collapse under the pressure of sanctions and military expenditures, only to admit later that Moscow has managed to defy the doom and gloom forecasts.
Last August, Bloomberg and the Washington Post reported that the sanctions had failed to bring about the economic collapse that Western leaders had hoped for. In December 2022, President Putin said that Russia was outperforming many of the G20 nations despite sanctions.
In April, the World Bank admitted that the Russian economy was doing considerably better than expected. It changed its Russian GDP forecast by saying that it would likely fall by mere 0.2% in 2023 – up from the 3.3% contraction forecast in its January outlook.
Russia’s economy minister was even more optimistic in his April forecast, saying the nation’s GDP is expected to grow 2.8% by 2026.
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