Bloomberg reports that leaked economic forecasts from Russia's Finance Ministry project that the Russian economy will shrink by as much as 12 percent this year as crippling economic sanctions wipe out roughly an entire decade's worth of economic growth.
This would also mark the worst economic crisis for Russia since the 1990s when the collapse of the Soviet Union sent the country's economy spiraling downward.
Natalia Lavrova, chief economist at BCS Financial Group in Moscow, tells Bloomberg that there is no easy fix for Russia going forward.
“The main negatives are the oil embargo, the EU giving up Russian gas, along with more departures among foreign companies,” she explained. “All that will probably expand gradually, with a lot of negative carrying over in to 2023.”
Major Western nations launched sanctions against Russia earlier this year after the country launched an unprovoked war against neighboring Ukraine.
Although many intelligence experts believed Russia would be able to quickly overrun Ukraine militarily, Russia has failed to achieve its objective of taking over the capital of Kyiv and has also faced significant setbacks in its efforts to take over the eastern region of the country.
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