Russian Economy: A Roller Coaster Ride

Russia has been on the limelight for a while due to the war as well as its actions on the financial front. After the sanctions, it has been affected by worst financial situations since the fall of Soviet Union. Further, a series of emails leaks from top government bodies makes it more vulnerable.

Ruble Dips to Lowest, then Recovers

While the Russian ruble was almost recovered from the drop caused by sanctions imposed by the US and its allies. The Russian economy is set for its biggest decline. This decline is seen in about three decades amid sweeping sanctions over the Ukraine war.

According to Interfax, the former Finance Minister Alexei Kudrin said on Tuesday that Russia’s GDP “will, of course, decline”. The official forecast will be about a 10% drop. Various Russian government agencies are forecasting on-year GDP declines. The forecasting for this year is to be in the range of about 8% to more than 10%, Kudrin added.

The country has only posted double-digit GDP declines twice in its modern history. Its GDP slumped only once after the collapse of the Soviet Union. According to Reuters, before the war, the Russian government had forecast GDP growth at 3%.

Reverts to Gold Standard 

To protect the value of the ruble, Putin proposed that Western economies deposit gold with Russia in order to purchase rubles, which can then be used to purchase oil and gas. In fact, Putin has decided to save the ruble by tying its value to gold. He is attempting to counter the collapse of the Russian currency with the backing of gold by pegging 5000 roubles to 1 gramme of gold.

Putin’s new arrangement is expected to last from March 28 to June 30. It is the latest in a series of rouble-related moves by the Russians, which began on March 23 with the announcement that they would only accept roubles for European gas instead of euros and US dollars.

This is a very powerful and disruptive idea because it has the potential to shift a large portion of the global energy trade away from the dollar in a single stroke. Linking a currency to gold can also be viewed as an economically responsible act.

Leaked Russian Government Emails

Before Alexei Kudrin’s statement, Anonymous released over two million emails obtained in cyberattacks on Russian organizations. Anonymous the decentralized hacking group announced this news through their social media. “This is just the beginning,” read a message posted on Twitter this past Sunday by the affiliated Anonymous TV account.

In the tweet, Anonymous promised to release other stolen data from Russian entities. In keeping with its promise, the collective announced on Monday that it had leaked nearly 600,000 new emails from three Russian datasets.

The batch contains over 200,000 emails (446GB) from the Russian Federation’s Ministry of Culture. According to the hackers, censorship is one of the main responsibilities of the department, which is in charge of implementing state policy in the arts and maintaining archives.

Anonymous has also released 230,000 emails (150GB) sent by the Blagoveshchensk city administration in the last three years, as well as 130,000 emails (116GB) sent by the governor of the Tver region and his staff in the last five years.

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Chaahat Girdhar

I'm Chaahat Girdhar, a journalist by profession who's turning her dreams into vision and vision into reality. I'm curious and have an appetite for gaining new knowledge. So I'm looking forward to learning things in the better way possible.

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