Economy of Russia

The Russian economy has been volatile over the past multiple decades. After 1989, its institutional environment was transformed from a command economy based upon socialist organizations to a capitalistic system. Its industrial structure dramatically shifted away over the course of several years from heavy investment in manufacturing as well as in traditional Soviet agriculture towards free market related developments in natural gas and oil extraction in additional to businesses engaged in mining. A service economy also expanded during this time. The academic analyst Richard Connolly has argued that, over the last four centuries in a broad sense, there were four main characteristics of the Russian economy that have shaped the system and persisted despite the political upheavals. First of all the weakness of the legal system means that impartial courts do not rule and contracts are problematic. Second is the underdevelopment of modern economic activities, with very basic peasant agriculture dominant into the 1930s. Third is technological underdevelopment, eased somewhat by borrowing from the West in the 1920s. And fourth lower living standards compared to Western Europe and North America. In 2020 its foreign exchange reserves were the fifth-largest in the world. Russian Empire Soviet Russia and the Soviet Union with socialist economy (1917–1987) Beginning in 1928, the course of the Soviet Union's economy was guided by a series of five-year plans. By the 1950s, the Soviet Union had rapidly evolved from a mainly agrarian society into a major industrial power. By the 1970s the Soviet Union was in an Era of Stagnation. The complex demands of the modern economy and inflexible administration overwhelmed and constrained the central planners. The volume of decisions facing planners in Moscow became overwhelming. The cumbersome procedures for bureaucratic administration foreclosed the free communication and flexible response required at the enterprise level for dealing with worker alienation, innovation, customers, and suppliers. , 1963 From 1975 to 1985, corruption and data manipulation became common practice within the bureaucracy to report satisfied targets and quotas, thus entrenching the crisis. Economic reforms within the Soviet system, re-introduction of private property and private business (1987–1991) Starting in 1986, Mikhail Gorbachev attempted to address economic problems by moving towards a market-oriented socialist economy. Gorbachev's policies of Perestroika failed to rejuvenate the Soviet economy; instead, a process of political and economic disintegration culminated in the breakup of the Soviet Union in 1991. Full transition to market economy, prices liberalization and privatization (1991–1997) for the Central Federal District ) Following the collapse of the Soviet Union, Russia underwent a radical transformation, moving from a centrally planned economy to a globally integrated market economy. Corrupt and haphazard privatization processes turned over major state-owned firms to politically connected "oligarchs", which has left equity ownership highly concentrated. A cabinet led by President Boris Yeltsin in the place of a prime minister took office in November 1991 with a mandate to implement economic reforms. Deputy Prime Minister Yegor Gaidar led the reform program, which began on 2 January 1992 with the lifting of price controls, and caused an immediate increase in prices. Yeltsin's program of radical, market-oriented reform came to be known as a "shock therapy". It was based on the policies associated with the Washington Consensus, recommendations of the IMF and a group of top American economists, including Larry Summers who in 1994 urged for "the three '-ations'—privatization, stabilization, and liberalization" to be "completed as soon as possible." Russian industry and society was not prepared for the change, and Yeltsin did not have control over the Russian Central Bank, which set monetary policy. As a result, monetary policy was poorly organized and coordinated. Russia experienced hyperinflation between 1992 and 1995. Prices increased by 300% in January 1992, and by as much as 1,000% in the first three months. Shock therapy was accompanied by a drop in the standard of living, including surging economic inequality and poverty, along with increased excess mortality and a decline in life expectancy. Russia suffered the largest peacetime rise in mortality ever experienced by an industrialized country. As of 1997, the number of people living in poverty had increased by fifteen times since 1990, with about half of the population below the poverty line. The majority of state enterprises were privatized amid great controversy and subsequently came to be owned by insiders for far less than they were worth. Many of them promptly invested their newfound wealth abroad, producing an enormous capital flight. This rapid privatization of public assets, and the widespread corruption associated with it, became widely known throughout Russia as "prikhvatizatisiya," or "grab-itization." Difficulties in collecting government revenues amid the collapsing economy and dependence on short-term borrowing to finance budget deficits led to the 1998 Russian financial crisis. In the 1990s, Russia was a major borrower from the International Monetary Fund, with loan facilities totalling $20 billion. The IMF was criticised for lending so much, as Russia introduced little of the reforms promised for the money and a large part of these funds could have been "diverted from their intended purpose and included in the flows of capital that left the country illegally". On 24 September 1993, at a meeting of the Commonwealth of Independent States (CIS) Council of Heads of State in Moscow, Azerbaijan, Armenia, Belarus, Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan, Uzbekistan signed the Treaty on the creation of an Economic Union which reinforces by an international agreement the intention to create an economic union through the step-by-step creation of a free trade area, a customs union and conditions for the free movement of goods, services, capital and labor. All these countries have ratified the Treaty and it entered into force on 14 January 1994. Turkmenistan and Georgia joined in 1994 and ratified the Treaty, but Georgia withdrew in 2009. On 15 April 1994, at a meeting of the Commonwealth of Independent States (CIS) Council of Heads of State in Moscow, all 12 post-Soviet states signed the international Agreement on the Establishment of a Free Trade Area in order to move towards the creation of an economic union. Article 17 also confirmed the intention to conclude a free trade agreement in services. Article 1 indicated that this was "the first stage of the creation of the Economic Union", but in 1999 the countries agreed to remove this phrase from the agreement. Russia concluded bilateral free trade agreements with all CIS countries and did not switch to a multilateral free trade regime in 1999. Bilateral free trade agreements, except for Georgia, Azerbaijan and Turkmenistan (all of these are in force ), ceased to apply only after 2012 with Russia's accession to the new multilateral CIS free trade area. Further integration took place outside the legal framework of the CIS. Pursuant to the Treaty on the creation of an Economic Union, the Agreement on the Customs Union between the Russian Federation and the Republic of Belarus was signed on 6 January 1995 in Minsk. The Government of the Republic of Belarus and the Government of the Russian Federation, on the one side, and the Government of the Republic of Kazakhstan, on the other side, signed an Agreement on the Customs Union in Moscow on 20 January 1995 in order to move towards the creation of an economic union as envisaged by the treaty. The implementation of these agreements made it possible to launch the Customs Union of the Eurasian Economic Community in 2010. , according to the database of international treaties of the Eurasian Economic Union, these agreements are still in force and apply in part not contrary to the Treaty on the Eurasian Economic Union. International agreements such as the following have further deepened trade and economic relations and integration with Belarus. The Community of Belarus and Russia was founded on 2 April 1996. The "Treaty on the Union between Belarus and Russia" was signed on 2 April 1997. And finally the Treaty on the Creation of a Union State of Russia and Belarus was signed on 8 December 1999. Early success followed by Asian and domestic financial crisis (1997–1998) In 1997, for the first time in many years, economic growth and low inflation were achieved. Russia had almost completed the main economic reforms necessary to complete the transition to a market economy, including the basic legislative framework, with the exception of macroeconomic stabilization. In 1997, the ruble was redenominated. The poor situation on Asian international markets led to low oil prices, which, given the fixed and strong ruble exchange rate, did not allow for compensation for low tax collection within the country. The country's budget was not secured by revenues because the Soviet Union had virtually no taxes or fiscal system in the modern sense, which had to be created from scratch. Due to the almost fixed and strong ruble exchange rate, domestic producers suffered from cheap imports. The combination of a large number of problems at once prevented the weak market economy from coping with the new challenges. Recovery of domestic production, macroeconomic stabilization and de-bureaucratization reforms (1998–2004) in the 2000s Between 2000 and 2002, significant pro-growth economic reforms included a comprehensive tax reform, which introduced a flat income tax of 13%; and a broad effort at deregulation which benefited small and medium-sized enterprises. Between 2000 and 2008, Russian economy got a major boost from rising commodity prices. GDP grew on average 7% per year. Disposable incomes more than doubled and in dollar-denominated terms increased eightfold. The volume of consumer credit between 2000 and 2006 increased 45 times, fuelling a boom in private consumption. The number of people living below poverty line declined from 30% in 2000 to 14% in 2008. Commodities boom, reserves, rise of consumer-driven economy and state corporations (2004–2008) Russia repaid its borrowing of $3.3 billion from the IMF three years early in 2005. Inflation remained a problem however, as the central bank aggressively expanded money supply to combat appreciation of the ruble. Nevertheless, in 2007 the World Bank declared that the Russian economy achieved "unprecedented macroeconomic stability". Until October 2007, Russia maintained impressive fiscal discipline with budget surpluses every year from 2000. A sharp, but brief recession in Russia was followed by a strong recovery beginning in late 2009. In dollar-denominated terms this amounted to a more than sevenfold increase in disposable incomes since 2000. This growth was a combined result of the 2000s commodities boom, high oil prices, as well as prudent economic and fiscal policies. However, these gains have been distributed unevenly, as the 110 wealthiest individuals were found in a report by Credit Suisse to own 35% of all financial assets held by Russian households. Russia also has the second-largest volume of illicit money outflows, having lost over $880 billion between 2002 and 2011 in this way. Since 2008 Forbes has repeatedly named Moscow the "billionaire capital of the world". In July 2010, Russia, together with Belarus and Kazakhstan, became a founding member of the Customs Union of the Eurasian Economic Community (EurAsEC), and the EurAsEC Single Economic Space, a common market of the same countries, came into force on 1 January 2012, superseding the bilateral agreements on free trade. At the same time Russia's membership to the WTO was accepted in 2011. Russia joined the World Trade Organization (WTO) on 22 August 2012 after 19 years of negotiations. On 20 September 2012, the multi-lateral Free Trade Area of the Commonwealth of Independent States (CIS FTA) came into force for Russia and subsequently superseded previous bilateral agreements among 9 participating post-Soviet states. In 2015, Russia became a founding member of the Eurasian Economic Union (EAEU), which replaced EurAsEC and envisaged a supranational economic union (the deepest stage of economic integration). Rapid GDP and income growth continued until 2013. The most important topic of discussion in the economy for a decade was the middle-income trap. In 2013, the World Bank announced that Russia had graduated to a high-income economy based on the results of 2012 but in 2016 it was reclassified as an upper-middle income economy due to changes in the exchange rate of the Russian ruble, which is a floating currency. While the UN Human Development Index, which assesses progress in the standard of living, health and education, ranks Russia among the 'very high human development' countries. Russian leaders repeatedly spoke of the need to diversify the economy away from its dependence on oil and gas and foster a high-technology sector. In 2012 oil, gas and petroleum products accounted for over 70% of total exports. This economic model appeared to show its limits, when after years of strong performance, the Russian economy expanded by a mere 1.3% in 2013. Conflicts with the West, income stagnation, import substitution programs and a pivot to the East (2014–2021) (2014), based on data from The World Factbook. Russia has the world's largest reserves. Following the annexation of Crimea in March 2014 and Russia's involvement in the ongoing War in Donbas, the United States, the European Union, Canada, and Japan imposed sanctions on Russia. According to the Russian economic ministry in July 2014, GDP growth in the first half of 2014 was 1%. The ministry projected growth of 0.5% for 2014. The Russian economy grew by a better than expected 0.6% in 2014. Russia was rated one of the most unequal of the world's major economies. Its social security system comprised roughly 16% of the total GDP in 2015. As a result of the World Bank's designation of a high-income economy, Barack Obama issued a proclamation 9188: "I have determined that Russia is sufficiently advanced in economic development and improved in trade competitiveness that it is appropriate to terminate the designation of Russia as a beneficiary developing country effective October 3, 2014." U.S. Customs and Border Protection (CBP) indicated that Russia formally graduated from the GSP program on 4 October 2014. As of 2015, real income was still lower for 99% of Russians than it was in 1991. s to tame inflation during their wars (Russo-Georgian War, Russo-Ukrainian War, Russian invasion of Ukraine) The Russian economy risked going into recession from early 2014, mainly due to falling oil prices, sanctions, and the subsequent capital flight. While in 2014 GDP growth remained positive at 0.6%, in 2015 the Russian economy shrunk by 3.7% and was expected to shrink further in 2016. By 2016, the Russian economy rebounded with 0.3% GDP growth and officially exited recession. The growth continued in 2017, with an increase of 1.5%. In January 2016, Bloomberg rated Russia's economy as the 12th most innovative in the world, up from 14th in January 2015 and 18th in January 2014. Russia has the world's 15th highest patent application rate, the 8th highest concentration of high-tech public companies, such as internet and aerospace and the third highest graduation rate of scientists and engineers. Gold reserves in Russia's subsoil, according to the U.S. Geological Survey, were at the end of 2017. In 2019, the Ministry of Natural Resources estimated the country's mineral reserves in physical terms. At the end of 2017, oil reserves were , gas reserves were , gold reserves were , and diamonds reserves were . Then for the first time the Ministry evaluated the mineral reserves of Russia in terms of value. The value of oil reserves amounted to 39.6 trillion rubles, the value of gas amounted to 11.3 trillion rubles, coking coal amounted to almost 2 trillion rubles, iron ore amounted to 808 billion rubles, diamonds amounted to 505 billion rubles, gold amounted to 480 billion rubles. The combined value of all mineral and energy resources (oil, gas, gold, copper, iron ore, thermal and lignite coal, and diamonds) amounted to 55.24 trillion rubles (US$844 billion), or 60% of GDP for 2017. The assessment occurred after the adoption of a new classification of reserves in Russia and the object of the methodology was only those fields for which a license was issued, so the assessment of the Ministry of Natural Resources is less than the total volume of explored reserves. Experts criticized such "an unsuccessful attempt to estimate reserves," pointing out that "one should not take such an estimate seriously" and "the form contains an incorrect formula for calculating the value". In the International Comparison Program 2021, the Commonwealth of Independent States (CIS) region was linked through the standard global core list approach, unlike in ICP 2017. Based on the results, the World Bank announced that in 2021 Russia was the 4th largest economy in the world ($5.7 trillion and 3.8 percent of the world) and the largest economy in Europe and Central Asia when measured in PPP terms. Breaking ties with the West, developing regional pan-Eurasian cooperation, tech sovereignty and self-sufficiency efforts (2022–present) In 2022, heavy sanctions were enacted due to the Russian invasion of Ukraine which will likely result in a steep recession. Since early 2022, many official economic statistics have not been published. Sanctions also included asset freezes on the Russian Central Bank, which holds $630 billion in foreign-exchange reserves, to prevent it from offsetting the effects of sanctions. On 7 March 2022, the Government of Russia in the first time approved a list of foreign states and territories that commit unfriendly acts against Russia, its legal entities and individuals. The Russian Federation believes that the countries that have restricted trade with Russia have directly violated the rules of the World Trade Organization. Russia distributed a statement to members of the organization, and the World Trade Organization published it on its website. In accordance with paragraph 2 of Article 40 of the Treaty on the Eurasian Economic Union, Russian Prime Minister Mikhail Mishustin has imposed increased tariffs on goods from unfriendly countries. A duty of 35% is imposed on imports of personal hygiene items, incense and weapons from unfriendly countries. The list includes shampoos and other hair products, individual deodorants and antiperspirants, products for aromatizing indoor air, detergents and cleaning products. The full list of goods subject to import duties of 20-50% from unfriendly countries is established by the government decree No. 2240 of 7 December 2022, which has been amended several times in 2023–2025. According to most estimates, every day of the war in Ukraine costs Russia $500 million to $1 billion. In 2022, Russia defaulted on part of its foreign currency, its first such default since 1918. In November 2022, it was reported that Russia had officially entered a recession as the Federal State Statistics Service had reported a national GDP loss for the second consecutive quarter. As part of the sanctions imposed on Russia, on 2 September 2022, the finance ministers of the G7 group agreed to cap the price of Russian oil and petroleum products, designed to allow Russia to maintain production, but limiting revenue from oil sales. In 2022, The Economist calculated that Russia did graduate into the category of high-income economies by 2022, if counted at purchasing power parity rather than the exchange rate but could fall below the threshold due to the invasion of Ukraine. In December 2022, a study at Bank of Russia's Research and Forecasting Department, found that the import dependence of the Russian economy is relatively low, does not exceed the median for other countries, and the share of imports in most industries is lower than in other countries. The key explanation for this could be the low involvement of the Russian economy in global value supply chains and its focus on production of raw materials. However, 60% of Russia's imports come from the countries that have announced sanctions against Russia. TASS reported poor results for the Russian economy the first quarter of 2023 with revenue of 5.7 trillion roubles – down 21% (mainly due to falling oil revenue), expenditure 8.1 trillion roubles – up 34% (mainly due to increased military costs), creating a deficit 2.4 trillion roubles – ($29.4 billion) Following Central Bank of Russia interventions, the exchange rate of the rouble against the dollar remained relatively stable in 2022, although in 2023 it started to decrease significantly, reaching RUB 97 per US$1 on 15 August 2023. Both the interventions and the exchange rate decrease resulted in significant criticism of the Central Bank by Russian state propaganda. Quarter 2 of 2023 saw a 13% fall in the value of the rouble against the dollar and a current account surplus estimated in to be falling by 80% from the annual 2022 surplus of $233 billion. After 11 years of negotiations, on 8 June 2023, in Sochi, Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia, Tajikistan and Uzbekistan signed the Commonwealth of Independent States Agreement on Free Trade in Services, Establishment, Operations and Investment to partly integrate Uzbekistan and Tajikistan on the common standards of the WTO (General Agreement on Trade in Services) and the EAEU (some provisions were borrowed from EAEU law) even without their membership in the WTO (Uzbekistan) or the EAEU (Uzbekistan and Tajikistan). On 19 June 2023, Lavrov stated that the Great Eurasian Partnership had become Russia's flagship project. In August and September 2023, the Central Bank of Russia started raising the key lending rate, ending up at 13% in September, while USD to RUB exchange rate remained at RUB 95. As of June 2023 share of Russia's exports to EU dropped to 1.7% while Russia's imports from EU dropped to 1.5%. In October 2023 the "psychological barrier" of RUB 100 per US$1 was crossed. In July 2024 the Russian Central Bank raised the key interest rate to 18%. Russia's ranking as Europe's largest economy in terms of PPP and the world's fourth largest economy was first released in May 2024. In July 2024, the World Bank again reclassified Russia as a high-income economy based on 2023 results. due to a demographic decline, demands of the war for industrial and military manpower, and large scale emigration. In January 2025, it was reported that Russia had used a two-prong strategy to finance the large costs of the Russo-Ukrainian war since early 2022. In addition to the official Russian government defense budget—direct financial expenditure for waging the war was estimated at US$250 billion through June 2024, rising to over 20% of annual GDP—an off-budget financing mechanism was employed to fund the war with over US$200 billion from preferential bank loans made to defence contractors and war-related businesses, loans compelled by the Russian government. Defense and security spending accounted for approximately 40% of Russia's total government spending in 2025, exceeding combined spending on education, healthcare, social policy and the national economy. Despite experiencing significant expansions in both 2023 and 2024, analysts have warned that the Russian economy risks stagnation in 2025 and onward due to labor shortages, high inflation, military overspending, falling resource prices and a dwindling National Wealth Fund. The Iran-EAEU FTA came into force on 15 May 2025. The Mongolia-EAEU Interim free trade in goods agreement signed on 27 June 2025. The United Arab Emirates-EAEU free trade in goods agreement signed on 27 June 2025. ==Data==

Original data are obtained and published in the national currency of the Russian Federation, the Russian ruble, by the Federal State Statistics Service Rosstat, as well as other organizations of which Russia is a member, such as the Eurasian Economic Commission and the Statistical Committee of the Commonwealth of Independent States. Due to the conversion of values into other currencies, the volume in other nominal currencies may fluctuate sharply. The average annual exchange rate of the ruble is usually used to convert annual data. The World Bank uses the Atlas method (a three-year average) to estimate GNI. Purchasing power parities is calculated as part of the successive cycles of the World Bank's International Comparison Program and comes into effect after several years (ICP 2021 data were published in May 2024 and applies by the World Bank since July 2024 and by the IMF since October 2024). The following table shows the main economic indicators in 1990–2024 and future estimates (indicated *) by the IMF. ==Currency and monetary policy==

On 25 December 1993, the Constitution of the Russian Federation came into force, where the main provisions were prescribed in the Article 75. The currency in the Russian Federation is the ruble. Monetary emission is carried out exclusively by the Central Bank of the Russian Federation (the Bank of Russia). The introduction and emission of other money in the Russian Federation is not allowed. The protection and ensuring the stability of the ruble is the main function of the Central Bank of the Russian Federation, which it carries out independently of other government bodies. On 1 September 2013, the Bank of Russia also became a regulator of financial markets, applying the integrated model of financial sector supervision. The Central Bank of the Russian Federation follows inflation targeting policy. Higher inflation than in developed countries has remained throughout the last 25–30 post-Soviet years and the devaluation of the currency (in relation to foreign currencies and in relation to domestic goods) is significantly compensated by higher interest rates and an increase in nominal incomes and assets. This situation is typical for developing markets. Typically devaluations of the ruble relative to foreign currency strongly stimulate the export-oriented economy of Russia. File:Russiaunemployment.png|Unemployment rate of Russia since the fall of the Soviet Union File:Russian inflation rate.webp|Russian inflation rate 2012–2022 Foreign exchange rate The currency exchange rate of the Russian ruble is floating. In 2011, the Bank of Russia, which was then headed by Sergei Ignatiev, took a course towards abolishing the currency corridor and designated a transition to a floating exchange rate for the ruble. Already under the new head of the Central Bank of the Russian Federation, Elvira Nabiullina, it was planned to complete the transition to a floating exchange rate regime from 1 January 2015. The Bank of Russia dismantled the currency corridor two months earlier - on 10 November 2014, so as not to waste gold and foreign exchange reserves. Ruble's Real Effective Exchange Rate remained in 2022–25 higher and stronger than in 1994 and 1998 when the sharp devaluations happened relative to the foreign currency. The Russian ruble is a freely convertible currency, and Russia allows the free movement of capital in Russian rubles. Within the common market of the Commonwealth of Independent States, the single market of the Eurasian Economic Union, and on the basis of bilateral agreements with other countries, the free movement of capital, payments and the free convertibility of the Russian ruble are ensured. Banking and payment system Russia built its banking system from scratch and created one of the most advanced banking systems in the world. From 2010 to 2018, the number of cashless card transactions in Russia increased by 30 times. At the same time, Russia became the world leader in the number of secure tokenized transactions which was called the "Russian miracle", according to the Boston Consulting Group (BCG). With tokenization, the card number is not stored on a mobile device, on the smartphone manufacturer's servers, or at the merchant. The adoption of contactless payments and mobile payments (Apple Pay, Samsung Pay) has also been more successful in Russia than anywhere else in the world. In 2020, Mark Barnett, President of Mastercard Europe, noted that Russia is one of the most advanced and developed payment markets in Europe. In 2020, the "Russian miracle" continued, as the pandemic gave a boost to the development of digital technologies. Russia ranked fourth in the global ranking of countries whose population actively abandoned cash in favor of cashless payments during the pandemic. Sberbank became the world's leader in terms of the number of transactions processed in 2024 in the ranking compiled by the Nilson analytical agency. Over the year, the number of transactions conducted by Sberbank exceeded 52 billion, surpassing the American companies JPMorgan Chase and Worldpay. In October 2025, Governor Elvira Nabiullina announced that cashless payments accounted for 87.5% of Russia's retail turnover in the first quarter. As of 1 January 2025 the Russia's national payments system comprises 28 payment systems, 354 money transfer operators. The Bank of Russia's payment system (in Russian rubles) is an integral part of the national payment system. Funds transfers are carried out by the Bank of Russia through urgent funds transfers, non-urgent funds transfers and the Faster Payment System ( instant 24/7 payments for work, goods, and services, including transactions made via QR code, mobile phone number and NFC). The Faster Payments System (SBP) was launched in 2019. ==Public policy==

Federal, regional and municipal budgets Fiscal policy Russia was estimated to have a government budget deficit of 2.6% of GDP in 2025, due to falling oil revenue and high military expenditure. Debts Russia is a creditor nation. As the IMF reported in 2016, Russia has a floating exchange rate, large official foreign exchange reserves, a positive net international investment position of about 20 percent of GDP, and a current account surplus. As reported in 2017, despite the low level of foreign direct investment (FDI) and capital market investments, Russia has been a net creditor for most of the last 25 years. As of 2022, Russia is a net creditor on international markets: the value of its foreign assets exceeds the value of its foreign liabilities. Russia has a positive net international investment position (NIIP) from December 2013 to September 2024. Russia has one of the lowest government debts (total external and domestic) and lowest external debts (total public/government and private) among world's economies. In 2022, domestic government debt increased by 13.9 percent to 18.78 billion rubles. Russia Domestic government Debt data was reported at RUB 19,801.921 billion in May 2023. In 2022, the share of external debt to GDP was 17%, decreasing from 26.3% in 2021. Russia's external debt was estimated at 381.8 billion U.S. dollars as of 1 January 2023, down 20.8 percent from the previous year. Russia External Debt reached US$357.9 billion in March 2023, compared with US$380.5 billion in the previous quarter. National wealth fund On 1 January 2004, the Government of Russia established the Stabilization fund of the Russian Federation as part of the federal budget to balance it if price of oil falls. On 1 February 2008, the Stabilization fund was divided into two parts. The first is a reserve fund equal to 10% of GDP and was to be invested in a similar way as the Stabilization Fund. The second is the National Welfare Fund of the Russian Federation to be invested in more risky instruments, including some shares in domestic and foreign companies. The Reserve fund which started with $125 billion was exhausted by 2017 and discontinued. The National Wealth Fund had started with $32 billion in 2008 and by August 2022, peaked at $201 billion. December 2023 saw it fall to $133 billion with liquid assets also down at $56 billion. Corruption by Transparency International, 2019 Russia was the lowest rated European country in Transparency International's Corruption Perceptions Index for 2025; ranking 157th out of 181 countries. Corruption is perceived as a significant problem in Russia, affecting various aspects of life, including the economy, business, public administration, law enforcement, healthcare, and education. The phenomenon of corruption is strongly established in the historical model of public governance in Russia and attributed to general weakness of rule of law in Russia. As of 2020, the percentage of business owners who distrust law enforcement agencies rose to 70% (from 45% in 2017); 75% don't believe in impartiality of courts and 79% do not believe that legal institutions protect them from abuse of law such as racketeering or arrest on dubious grounds. ==Income inequality==

In Russia, areas where income is higher have increased air pollution. However while income may have been higher in these regions a greater disparity in income inequality was found. It was discovered that "greater income inequality within a region is associated with more pollution, implying that it is not only the level of income that matters but also its distribution". In Russia areas lacking in hospital beds suffer from greater air pollution than areas with higher numbers of beds per capita which implies that the poor or inadequate distribution of public services also may add to the environmental inequality of that region. ==Regional economies and economic regions==

Federal subjects According to the Moscow Government, the Moscow economy is the largest among the Russian Federation constituent entities: the capital accounts for one fifth of the country's total gross regional product. Moscow is one of the largest urban economies in the world in terms of GDP (purchasing power parity, PPP) and one of the top 5 global megalopolises according to this value. The Moscow GDP (PPP) in 2021 amounted to US$25.500 billion, which is more than that of Seoul, Shanghai or Paris. According to statements by the Mayor of Moscow in 2024, Moscow contributed more than 20 per cent of the country's GDP. This contribution is related to innovation, IT sector and services. Labour productivity in Moscow is on average 2.5 times higher than in Russia due to the high concentration of residents. In May 2025, Mayor Sobyanin reported to President Putin that Moscow's gross regional product at purchasing power parity for 2024 had grown to int$ 1.39 trillion, allowing the Russian capital to rank second among the world's largest urban economies, second only to New York and ahead of Shanghai. "In 2020, we were in fifth place and since 2023, we have moved up to second place," said the mayor of Moscow. Moscow is home to 90 billionaires in 2025 – 16 more than a year ago. Moscow comes in second place behind New York City according to Forbes. Groupings Russia is divided into twelve economic regions. • Central Black Earth Economic Region • Central Economic Region • East Siberian Economic Region • Far Eastern Economic Region • Kaliningrad Economic Region • North Caucasus Economic Region • Northern Economic Region • Northwestern Economic Region • Ural Economic Region • Volga Economic Region • Volga-Vyatka Economic Region • West Siberian Economic Region In 2018, the Russian Ministry of Economic Development developed a strategy for the spatial development of Russia, in which it was proposed to introduce the division into 14 macro-regions. In February 2019, the strategy was approved and the division into 12 macro-regions was implemented. There are also macrozones such as the Baikal Amur Mainline economic zone. Centre-periphery model According to a 2011 research article, the nature of the relationship between the centre and the regions in Russia today corresponds to the so-called "centre-periphery" model; excessive centralisation, the absence of alternative (to Moscow) centres in the country's territorial structure and weak horizontal links are stable characteristics of the Russian political and economic space and are constantly reproduced over time. More than a decade ago, Professor Natalia Zubarevich proposed an extension of the centre-periphery model and is known as the author of the "theory of four Russias". According to Zubarevich, the different speed of social modernisation is more accurately explained by the centre-periphery model. The entire population of the country can be divided into three roughly equal parts - about a third of citizens in each. The underdeveloped republics, where 6% of the country's population lives - this "fourth" Russia has its own specific features. According to the concept, "First Russia" is the cities with millions of inhabitants, i.e. the most modernised and economically developed territories. "Second Russia" are medium-sized cities with a pronounced industrial profile. "Third Russia" - small towns, workers' settlements, rural areas. Compared to "first" and "second Russia" - this is a deep periphery in terms of the quality of socio-economic life. The "fourth Russia" is made up of the national republics of the Caucasus, as well as the south of Siberia (Tuva, the Altai Republic). These territories also represent a periphery, but a specific one: the demographic transition has not been completed here, urbanisation is in its infancy, and patriarchal-clan principles are still strong in society. Monoprofile towns (monotowns) are the most unstable part of the "second Russia". ==Sectors==

Primary Energy and gas supplier to much of Europe. headquarters on the bank of the Moskva River, Moscow The mineral-packed Ural Mountains and the vast fossil fuel (oil, gas, coal), and timber reserves of Siberia and the Russian Far East make Russia rich in natural resources, which dominate Russian exports. Oil and gas exports, specifically, continue to be the main source of hard currency. Russia has been widely described as an energy superpower; as it has the world's largest natural gas reserves, The country was the world's fourth-largest electricity producer, and the ninth-largest renewable energy producer in 2019. Russia was also the world's first country to develop civilian nuclear power, and built the world's first nuclear power plant. In 2019, It was the world's fourth-largest nuclear energy producer. After the collapse of the Soviet Union, the Russian state nuclear conglomerate Rosatom became the dominant actor in international nuclear power markets, training experts, constructing nuclear power plants, supplying fuel and taking care of spent fuel in around the world. Whereas oil and gas were subject to international sanctions after Russia's full-scale invasion of Ukraine in February 2023, its nuclear industry was not targeted by sanctions. The share of oil and gas in Russia's exports (about 50%) and federal budget revenues (about 50%) is large, and the dynamics of Russia's GDP are highly dependent on oil and gas prices, but the share in GDP is much less than 50%. According to the first such comprehensive assessment published by the Russian statistics agency Rosstat in 2021, the maximum total share of the oil and gas sector in Russia's GDP, including extraction, refining, transport, sale of oil and gas, all goods and services used, and all supporting activities, amounted to 16.9% in 2017, 21.1% in 2018, 19.2% in 2019 and 15.2% in 2020. To compare the data obtained using the same methodology, the source provides data for other countries. This is more than the share of GDP in the United States (8%) and Canada (less 10%). This is comparable to the share of GDP in Norway (14%) and Kazakhstan (13.3%). It is much lower than the share of GDP in the United Arab Emirates (30%) and Saudi Arabia (50%). This assessment did not include, for example, the production of used pumps or specialized education, which should have been included, according to experts. Russia consumes domestically two-thirds of its gas production and a quarter of its oil production while it sells three-quarters of its oil on the world market and Russia's share of the traded world oil market is 17.5% - more than Saudi Arabia's. At the same time, experts note that there are formal and informal part of the rent and the total oil and gas rent in 2023 can be estimated at 24% of Russia's GDP. Michael Alexeyev (son of Lyudmila Alexeyeva), a professor of economics at Indiana University, notes that the oil and gas taxes reported by the government do not include corporate dividends and the so-called indirect or additional revenues derived from the expenditure of oil and gas rents in the economy. There is also such an indicator as the oil rent (% of GDP), which is published by the World Bank. It is 9.7% for Russia, 14.8% for Kazakhstan, 6.1% for Norway, 23.7% for Saudi Arabia, 15.7% for the United Arab Emirates, 2.8% for Canada and 0.6% for the United States. 2023 saw a fall in Russia's oil and gas tax revenues of 24% to 8.8 trillion roubles ($99.4 billion) compared to 2022. As of September 2025, Ukrainian drone and missile strikes have disrupted nearly 40% of Russia's oil refining capacity, forcing Moscow to import gasoline from Asian nations and creating widespread fuel shortages across multiple Russian regions. The sustained campaign has knocked approximately 338,000 tons per day of crude oil processing offline, with over 20 regions experiencing shortages and gas stations implementing fuel rationing measures. In September 2025 the International Energy Agency stated that Russia's revenues from oil product exports had in August declined to five-year lows, contributing to Russia's economic slowdown. Mining Russia is also a leading producer and exporter of minerals and gold. Russia is the largest diamond-producing nation in the world, estimated to produce over 33 million carats in 2013, or 25% of global output valued at over $3.4 billion, with state-owned ALROSA accounting for approximately 95% of all Russian production. In 2019, the country was the 3rd world producer of gold; 2nd worldwide producer of platinum; 4th worldwide producer of silver; 9th largest world producer of copper; 3rd largest world producer of nickel; 6th largest world producer of lead; 9th largest world producer of bauxite; 10th largest world producer of zinc; 2nd worldwide producer of vanadium; 2nd largest world producer of cobalt; 5th largest world producer of iron ore; 7th largest world producer of boron; 9th largest world producer of molybdenum; 13th largest world producer of tin; 3rd largest world producer of sulfur; 4th largest world producer of phosphate; 8th largest world producer of gypsum; in addition to being the world's 10th largest producer of salt. It was the world's 6th largest producer of uranium in 2018. Agriculture, fishing and forestry in Rostov Oblast Russia's agriculture sector contributes about 5% of the country's total GDP, although the sector employs about one-eighth of the total labour force. It has the world's third-largest cultivated area, at . However, due to the harshness of its environment, about 13.1% of its land is agricultural, The main product of Russian farming has always been grain, which occupies considerably more than half of the cropland. and is the largest producer of barley, buckwheat, oats, and rye, and the second-largest producer of sunflower seed. Various analysts of climate change adaptation foresee large opportunities for Russian agriculture during the rest of the 21st century as arability increases in Siberia, which would lead to both internal and external migration to the region. More than one-third of the sown area is devoted to fodder crops, and the remaining farmland is devoted to industrial crops, vegetables, and fruits. It is also home to the world's finest caviar (the beluga), and produces about one-third of all canned fish, and some one-fourth of the world's total fresh and frozen fish. The Space industry of Russia consists of over 100 companies and employs 250,000 people. Automotive is a brand of AvtoVAZ, the largest Russian car manufacturer in the Russian automotive industry. , a recent armoured limousine project by NAMI Following the 2022 sanctions and the withdrawal of Western manufacturers the production dropped to 450,000 passenger cars in 2022, the lowest level since the dissolution of the Soviet Union in 1991. The main local brands are light vehicle producers AvtoVAZ and GAZ, while KamAZ is the leading heavy vehicle producer. In December 2022 the only foreign car manufacturers are eleven Chinese carmakers that have production operations or are constructing their plants in Russia. Chemical Electronics Russia was experiencing a regrowth of microelectronics, with the revival of JCS Mikron until sanctions took effect in 2022. Food manufacturing Pharmaceutical Shipbuilding Science and technology Services Banking and finance Education Healthcare Retail As of 2013, Russians spent 60% of their pre-tax income on shopping, the highest percentage in Europe. This is possible because many Russians pay no rent or house payments, owning their own home after privatization of state-owned Soviet housing. Shopping malls were popular with international investors and shoppers from the emerging middle class. Russia had over 1,000 shopping malls in 2020, although in 2022, many international companies left Russia resulting in empty stores in malls. A supermarket selling groceries is a typical anchor store in a Russian mall. Retail sales in Russia Telecommunications In 2024 the revenue of Russian telecom operators amounted to more than 2.1 trillion rubles, which was 7.8% more than the previous year. There are four national mobile phone networks, MegaFon, Tele2, Beeline and MTS with total subscriptions between 2011 and 2021 ranging between 200 and 240 million. Although almost everyone uses the internet, Telegram is throttled and WhatsApp is blocked. The total length of common-used railway tracks is the world's third-longest, and exceeds . , Russia has 1,452.2 thousand km of roads, and its road density is among the world's lowest. Russia's inland waterways are the world's second-longest, and total . Among Russia's 1,218 airports, the busiest is Sheremetyevo International Airport in Moscow. air transport is hampered by sanctions on spare parts from Boeing and Airbus, and by drones disrupting airports. Russia is the world's sole country to operate nuclear-powered icebreakers, which advance the economic exploitation of the Arctic continental shelf of Russia, and the development of sea trade through the Northern Sea Route. Water supply and sanitation Construction and real estate In 2022, construction was worth 13 trillion rubles, 5% more than in 2021. Residential construction in 2022 reached . The 2020–2030 target for construction is of housing, 20% of all housing stock to be renovated and to increase space from up to per person. Although relative indicators of the Russian insurance market returned to pre-crisis levels, the progress is achieved mainly by the increase of life insurance and accident insurance, the input of these two market segments in premium growth in 2013 largely exceeds their share on the market. As before, life insurance and accident insurance are often used by banks as an appendix to a credit contract protecting creditors from the risk of credit default in case of borrower's death or disability. The rise of these lines is connected, evidently, with the increase in consumer loans, as the total sum of credit obligations of population in 2013 increased by 28% to RUB 9.9 trillion. At the same time premium to GDP ratio net of life and accident insurance remained at the same level of 1.1% as in 2012. Thus, if "banking" lines of business are excluded, Russian insurance market is in stagnation stage for the last four years, as premiums to GDP ratio net of life and accident insurance remains at the same level of 1.1% since 2010. Information technology Russian software exports have risen from just $120 million in 2000 to $3.3 billion in 2010. Since the year 2000 the IT market has started growth rates of 30–40% a year, growing by 54% in 2006 alone. The biggest sector in terms of revenue is system and network integration, which accounts for 28.3% of the total market revenues. The government has launched a program promoting construction of IT-oriented technology parks (Technoparks)—special zones that have an established infrastructure and enjoy a favorable tax and customs regime, in seven different locations: Moscow, Novosibirsk, Nizhny Novgorod, Kaluga, Tumen, Republic of Tatarstan and St. Peterburg Region. Russia is one of the few countries in the world with a homegrown internet search engine with a significant marketshare as the Russian-based search engine Yandex is used by 53.8% of internet users in the country. Known Russian IT companies are ABBYY (FineReader OCR system and Lingvo dictionaries), Kaspersky Lab (Kaspersky Anti-Virus, Kaspersky Internet Security), Mail.Ru (portal, search engine, mail service, Mail.ru Agent messenger, ICQ, Odnoklassniki social network, online media sources). Tourism in Saint Petersburg, a UNESCO World Heritage Site Most foreign tourists come from China. Major tourist routes in Russia include a journey around the Golden Ring theme route of ancient cities, cruises on the big rivers like the Volga, and journeys on the famous Trans-Siberian Railway. Russia's most visited and popular landmarks include Red Square, the Peterhof Palace, the Kazan Kremlin, the Trinity Lavra of St. Sergius and Lake Baikal. ==Economic integration==

Russia joined the World Trade Organization (WTO) on 22 August 2012. The EAEU Treaty in 2015 superseded previous integration agreements and envisaged an economic union (the deepest stage of economic integration). The EAEU provides for free movement of goods, services, capital and labour without a work permit ("four economic freedoms" as in the European Union), pursues coordinated, harmonized and single policy in the sectors determined by the Treaty and international agreements within the Union. The EAEU has a Eurasian Customs Union and an integrated single market of 183 million people. ==External trade and investment==

Foreign payments Since the collapse of the Bretton Woods system and the creation of the Jamaican monetary system, membership in the International Monetary Fund no longer requires the use of the US dollar, and by 1973 the US dollar was no longer the sole global currency. Russia joined the IMF in 1992, although the USSR had previously refused to ratify the founding document. The Soviet Union and other socialist countries used the so-called transferable ruble and clearing ruble. The Interstate Bank became the first international financial organization created by the Commonwealth of Independent States, which was given the specific goal of developing mutual settlements in national currencies. The mechanism for cross-border settlements in national currencies (payment and settlement system), based on the use of direct correspondent accounts with central banks and access to payment systems, has been in operation for more than 15 years (since circa 2005), as reported in 2020. The Agreement on Establishment of the Interstate Bank was signed on 22 January 1993 by Armenia, Belarus, Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan, Turkmenistan, Uzbekistan, Ukraine and ratified by all countries except Ukraine, which revoked its signature in 1997. Back in February 2010, online retailer Sportmaster announced its intention to become the first Russian company to switch to the national currency for settlements with suppliers and to use the yuan for trade with China. On 13 December 2010, Bank HSBC announced that it had processed Russia's first international transaction in yuan for the Sportmaster group of companies. As part of China's efforts to internationalize the yuan, trading in the ruble/yuan currency pair began on the MICEX on 16 December 2010. The Moscow Interbank Currency Exchange (MICEX) became the first organized (i.e., exchange-based) platform for yuan trading outside China. This was made possible by an agreement signed in April 2010 on the mutual launch of trading in yuan and rubles. Since the end of November 2010, rubles can be bought in China on the China Foreign Exchange Trade System. In 2017, a payment versus payment (PVP) system was created for the first time for transactions between the yuan and foreign currencies, according to a statement published on the website of the China Foreign Exchange Trade System (CFETS). The ruble became the first foreign currency to be included in the system. Earlier, the Russian central bank opened its first overseas office in Beijing, and the Industrial and Commercial Bank of China (ICBC) officially began operating as a Chinese clearing bank for yuan settlements in Russia. In 2020, VTB's Shanghai branch connected to China's national domestic payment system, CNAPS (China National Advanced Payment System). It has direct access to the CNAPS national payment system, which allows payments to be made to all local banks connected to this system, i.e., virtually all banks in China. Settlements are made through accounts with the central bank of the People's Republic of China. By 2022, 23 Russian banks had been connected to the Chinese Cross-Border Interbank Payment System. Back in 2022, nine Russian banks, including Sberbank and VTB Bank, opened special accounts in India for settlements in rupees for Indian-Russian trade transactions in order to internationalize the rupee and facilitate international trade operations. In 2023, the vice president of the Interstate Bank noted that payments in national currencies had increased significantly. By 2023, the Russian ruble had become the main currency for trade with the CIS. In 2023, Elvira Nabiullina, Governor of the Bank of Russia, attended the Asian Clearing Union summit in Tehran. In 2023, the Central Bank of Iran announced that by connecting to the Russian Central Bank's payment system, it had also gained access to more than 100 banks in 13 countries, in addition to Russia. An Iranian banking official revealed that all Russian banks and 106 banks in 13 other countries have been connected to Iran's financial messaging system known as SEPAM. In 2024, Mohammad Reza Farzin, head of the Central Bank of Iran, announced a new ACUMER system to replace SWIFT and a new agreement with Russia. In 2024, Farzin emphasized Iran's readiness to provide technical capabilities for Russia's membership in the Asian Clearing Union. "Belarus recently requested to join this union, and we invite Russia to join as well," he said. The National Bank of Belarus, Russia's closest ally, has already become a member of the Asian Clearing Union. Launched in 2025, Digital renminbi is already available in Russia and other CIS countries, said Boris Titov, co-chairman of the Russian-Chinese Friendship Committee. Russia has become the leader among European countries surpassing Britain in terms of incoming cryptocurrency flows, according to a report by the analytical company Chainalysis for the period from July 2024 to June 2025. Analysts estimate the volume of cryptocurrencies that entered Russia during this period at $376.3 billion. One reason for the rapid growth of the Russian cryptocurrency market has been cross-border settlements, primarily using the ruble-pegged stablecoin A7A5. The share of payments in Russian rubles in Russia's foreign trade settlements in August 2025 once again reached an all-time high, reaching 55.2%, according to calculations based on data on the currency structure of foreign trade settlements on the Bank of Russia website. The share of payments in rubles for Russian exports was record high in August, rising to 56.3%. The share of payments in Russian rubles for imported goods and services to Russia in August was 54.1%. Payments in currencies of friendly countries accounted for 29.4% of exports from Russia in August. In payments for imports to Russia, this figure was 30.1% in August. The share of "toxic" currencies in payments for exports in August was 14.3%, and for imports to Russia, it was 15.7%. Russia and Iran already conduct 80% of their mutual settlements in rials and rubles. According to the Ministry of Economic Development, the share of national currencies in trade with CIS countries has already exceeded 85%, and with China it has come close to 95%. In November 2025, Minister Siluanov stated that the ruble and yuan now account for over 99% of trade settlements between Russia and China. A 2025 study said that an important constraint on the economy was “Russia’s dependence on hard currencies like the dollar and the euro, with only partial “yuanization” of its foreign trade transactions”. Investments Russia has concluded a number of Bilateral Investment Treaties (BITs), Treaties with Investment Provisions (TIPs) and Investment Related Instruments (IRIs) according to the database of UNCTAD. 65 agreements have entered into force. Trade Russia recorded a trade surplus of US$15.8 billion in 2013. In 2015, Russia main exports are oil and natural gas (62.8% of total exports), ores and metals (5.9%), chemical products (5.8%), machinery and transport equipment (5.4%) and food (4.7%). Others include: agricultural raw materials (2.2%) and textiles (0.2%). Russia top exports in 2021 were: Crude oil $110.9b, Processed oil $69.9b, gold $17.3b, coal $15.4b and natural gas $7.3b. per capita, 2016 (US dollars): 2013–present In 2017, Russian Federation's commercial services' shares of total exports and imports were 13.9% and 26.8%, respectively. Russian Federation had a trade-to-GDP ratio of 46.6% in 2017. In 2013–2017, Russia had a trade surplus for goods, and a trade deficit for services. Since trade in goods is larger than trade in services, Russia had a significant trade surplus. Trade is relatively important to the Russian economy: the ratio of Russia's goods trade (exports plus imports) to GDP has averaged about 40% in recent years, compared to 20% for the United States. In 2021, Russia ranked 13th among world goods exporters and 22nd among importers. According to Russian official sources, its goods exports totaled $492 billion in 2021, up 46% from 2020 (not adjusting for inflation). Minerals, including oil and gas, made up nearly 45% of these exports. Goods imports rose by 27%, reaching $294 billion in 2021. Machinery and mechanical appliances topped the list of imports, accounting for almost a third of Russia's goods imports. In services trade, Russia ranked 26th among world exporters and 19th among importers in 2020, the most recent year for which data is available. The country was a net importer of services, exporting $49 billion worth of services and importing $76 billion. while exports made up 30.9%. Russia has trade-to-GDP ratio (trade openness) 49.26% which is below the global average. In a December 2022 study, an economist from the Bank of Russia's Research and Forecasting Department found that Russia's import dependence is relatively low, does not exceed the median for other countries and the share of imports in most industries is lower than in other countries. The key explanation for this could be the low involvement of the Russian economy in global value supply chains and its focus on production of raw materials. However, 60% of Russia's imports come from the countries that have imposed sanctions against it. == Mergers and acquisitions ==

Between 1985 and 2018, almost 28,500 mergers or acquisitions have been announced in Russia. This cumulates to an overall value of around US$984 billion which translates to RUB 5.456 billion. In terms of value, 2007 has been the most active year with US$158 billion, whereas the number of deals peaked in 2010 with 3,684 (964 compared to the value record year 2007). Since 2010 value and numbers have decreased constantly and another wave of M&A is expected. == See also ==