Russia’s Economic Outlook Is Getting Bleaker by the Day
Vladimir Putin, President of Russia, Speaking to Russian Business Leaders on February 24, 2022, the Day His Military Invaded Ukraine (Official Photo)
By Pam Martens and Russ Martens: April 7, 2022 ~
There is growing evidence that Russian President Vladimir Putin’s invasion of Ukraine and growing atrocities against Ukrainian civilians are not just delivering long-term damage to Russia’s reputation around the world but to its economy at home as sanctions begin to take a heavy toll.
Automotive News Europe reported yesterday that “New vehicle sales fell 60 percent in March from the previous month at Rolf, Russia’s largest dealership….” Rolf’s CEO, Svetlana Vinogradova, told Reuters she expected full year demand to fall by half in 2022.
Forecasts for overall economic contraction is Russia this year range from a 10 percent contraction forecast by Goldman Sachs to a 15 percent drop forecasted by the Institute for International Finance.
Signs of a slowdown are already showing up in manufacturing. The S&P Global Purchasing Managers’ Index (PMI) for Russia fell to 44.1 in March. A reading below 50 signals a contraction.
Even Russia’s economy ministry is sharing news of the bleak outlook. Reuters reported yesterday that the economy ministry announced yesterday that “annual inflation in Russia accelerated to 16.70 percent as of April 1.”
In an attempt to deal with the soaring inflation, the Russian central bank has hiked its benchmark interest rate from 9.5 percent to 20 percent. One day after the Ukraine invasion, Standard and Poor’s cut Russia’s debt rating to junk. Junk ratings soon followed from Moody’s and Fitch.
The U.K.’s Daily Mail reported on Saturday that in Russian supermarkets “Instant coffee has risen almost 70 per cent and sugar is up 30 per cent.” Multiple European news outlets are reporting that shelves are bare for feminine hygiene products.
The Yale School of Management, which has been keeping a running tally of the names of businesses suspending or ending business ties to Russia, noted today that “Over 600 companies have announced they are voluntarily curtailing operations in Russia to some degree beyond what is required by international sanctions….”
Not among that group are subsidiaries of Koch Industries, whose Chairman and CEO is the heavy-handed billionaire meddler in U.S. politics, Charles Koch. It plans to keep its Russian glass plants operating. See our detailed report here.
If you would like to send a message to Koch Industries and Charles Koch by avoiding buying the products they sell in the U.S., here’s a partial list:
Consumer Paper Products:
Dixie disposable paper plates, bowls and cups
Northern Quilted and Angel Soft bath tissue
Brawny and Sparkle paper towels
Vanity Fair and Mardi Gras table napkins
Georgia-Pacific Wood Products:
ForceField® Air and Water Barrier System
DryGuard® and DryMax® Enhanced Sub–floors
Thermostat® radiant barrier roof sheathing
Georgia-Pacific Gypsum Products:
GOLD Dens® brand of fiberglass mat gypsum panels
ToughRock® Fireguard 45® Gypsum Board
FireDefender
Invista Brands:
Antron flooring products
Dacron fiberfill, used in pillows, comforters and mattress toppers
Cordura fabric for military clothing and high-performance gear
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