economy
Russian economy resilient despite GDP contraction and sanctions
Russian Deputy Prime Minister Aleksandr Novak says economy remains resilient despite a GDP contraction, citing low unemployment, rising incomes and industrial growth
TL;DR
- Russian GDP contracted by 0.3% year-on-year in the first quarter of 2026.
- This marks the first quarterly contraction since early 2023, following years of expansion.
- Deputy Prime Minister Aleksandr Novak stated the Russian economy remains fundamentally strong.
- Evidence cited includes low unemployment, rising household incomes, and improving business activity.
- Manufacturing output has increased by nearly 23% since 2022.
- Real disposable incomes have increased by 26.1% over the past three years.
- Poverty has declined to a record low of 6.7% (2025 data).
- Unemployment is expected to remain around 2.3-2.4%.
- The slowdown is partly attributed to labor shortages and tight monetary policy.
- Economic Development Minister Maksim Reshetnikov expects GDP growth of 0.4% in 2026, accelerating to 1.4% in 2027.