The Economy of Russia has entered a phase of technical recession: what does it mean.

According to ТСН: Currently, the economy of Russia is effectively entering a phase of decline, which is theoretically referred to as a technical recession.

According to expert Ivan Us, Chief Consultant of the National Institute for Strategic Studies,

“When statements about stagnation are made in Russia, I do not agree with that. The state of the Russian economy now is primarily a technical recession.”

The expert notes that despite optimistic official reports from the Kremlin, which do not reflect the real state of affairs, Russian bankers openly talk about a decline in GDP in the first and second quarters of this year. According to economic theory, two consecutive quarters of decline are considered a technical recession — this is an interim state between regular slowdowns and a full-blown economic downturn.

The State of Russia's GDP

According to World Bank data, in 2021 and 2022, Russia's GDP grew at a rate of 4.1–4.3%, reaching 2.07 and 2.183 trillion dollars respectively. However, the forecast of the International Monetary Fund, published by Bloomberg, indicates that growth is expected to be only 0.6% by 2025.

Russia's Budget Problems

Earlier it was reported that the Russian authorities began using the monetary emissions of the Central Bank of the Russian Federation to cover the budget deficit, which may reach nearly 6 trillion rubles this year.

It has also been noted that revenues from the Russian budget from the oil and gas sector may decrease by approximately 35% in November compared to the same month in 2024 — to 520 billion rubles (6.59 billion dollars).

The situation with Russia's economy raises many questions and will be an important topic for discussion on the international stage. Experts note that a technical recession may have significant consequences for the country's financial system, especially in conditions of political and economic instability. Further forecasts regarding the development of events remain uncertain, as much depends on both internal and external factors.