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Russia’s Economic Strength Gives it High-Income Status Despite Sanctions

 / Go to the mediabankPeople sit on a veranda of a cafe at Red Square on a hot summer day, in Moscow, Russia. / Go to the mediabank

The World Bank has classified Russia as a high-income country, with its per capita gross national income rising to $14,250 in 2023 from $12,830 in 2022, according to the bank’s report.The World Bank’s recognition of Russia as a high-income country is “not surprising, but a reality”, Dr. Georgy Ostapkovich, Director of the Center for Market Research at the Higher School of Economics, told Sputnik.Russia is seeing income growth of around 4-5%, with earnings growing in double digits, Ostapkovich said, stressing that the driving force is economic growth.”Incomes only grow when the economy grows. If the economy grows, then profits grow. If profits grow, then the entrepreneur is keen on hiring people and raising wages,” he added.Russia’s economy grew by 3.6% in 2023, with real incomes and nominal wages up by 4.5% and 13% respectively. Industrial performance, particularly in manufacturing, is propelling this growth not seen in 20 to 30 years. Notably, mechanical engineering in the military industry is expanding at 25-30%, according to Ostapkovich.EconomyRussia Learned to Overcome Turbulent Situations in Global Economy – Finance Minister6 June, 10:48 GMTAndrey Kolganov, Doctor of Economics and Head of the Laboratory of Socio-Economic Systems at Moscow State University, acknowledged that despite the challenges posed by the growth stimuli, Western sanctions failed to inflict significant harm on the Russian economy.”The Russian economy has shown great potential in adapting to these difficulties. Moreover, these difficulties stimulated the development of domestic production, which in turn led to high rates of economic growth,” he added.Kolganov noted that economic growth rates were higher in 2023, compared to 2022 – and even higher in 2024. These increases promoted Russia from the classification of middle-income countries, to the rank of high-income countries.Although Russia has not caught up with the richest countries, the achievement is nonetheless remarkable, especially in the face of unprecedented sanctions.EconomyWestern Economies Fall Off Ranking of Russia’s Top 5 Trade Partners and Into Recession7 April, 15:35 GMTGross national income per capita in Russia is now $14,250, according to a document released by the World Bank that classifies countries that cross the $13,485 threshold as “high income.”

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