Russian economy grows, but so does average Russians' malaise

On the plus side, the Russian economy is no longer in the tailspin that it had fallen into in 2014-2015. Economic growth stood at 3.1% over the last 12 months, and industrial production grew by 2% over the last six.
By Mark Schwartz | Jul 25, 2017
The Russian economy is showing palpable signs of recovery, but a near-majority of average Russians still expects life to get worse instead of better, according to the latest findings of the Russian Public Opinion Research Centre (VTsIOM). The Russia-based marketing and opinion-research company released a compilation of data showing a mixed assessment of Russia's volatile economic state.
On the plus side, the Russian economy is no longer in the tailspin that it had fallen into in 2014-2015. Economic growth stood at 3.1% over the last 12 months, and industrial production grew by 2% over the last six. Real wage growth rose 2.9% from May 2016 to May 2017, and retail sales grew by 0.7% in May of this year and 1.2% in June.
Debt is also on the wane. The Russian government's budget deficit shrank from -3.4% last year to 2.6% this year, and it is running a surplus of $22 billion and projects a debt load amounting to 36% of GDPa very small amount by global standards. The country is also building its foreign currency reserves, with $400 billion in its central bank as of this fiscal year.
At the same time, 45% of Russians polled say that they think "the worst is yet to come." Growing numbers of respondents worry that war might erupt with the United States due to Syria or Ukraine. Concerns over rising food prices and declining personal savings are also widespread.
"Fears regarding the level of income, unemployment and internal unrest that used to be fairly moderate are also showing unfavorable dynamics," said Oleg Chernozub, VTsIOM's leading pollster, in a note on Wednesday. "Society's optimism with respect to overcoming the crisis and maintaining political stability is becoming unsteady."

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