Bloomberg: the growth of military production compensates for the damage from sanctions for Russian industry

Military production compensates for most of the damage to Russian industry from sanctions and other restrictions from the West. Thanks to the growth of production in the military sector, the decline in industry in Russia by the end of 2022 amounted to 0.7%, reported Bloomberg.

According to Bloomberg economists, the indicators of industrial production in Russia turned out to be better than forecasts, as well as the results of previous crisis periods. According to them, this happened due to the increase in government spending on heavy and light industry. Industry has become one of the most stable sectors of the Russian economy.

Bloomberg notes that Russia does not publish production statistics in the military industry, but some sectors of the military-industrial complex are included in the general industry statistics.

The production of metal products, including weapons, bombs and ammunition, increased by 5% in January-November 2022. The production of computers, electronic and optical products also increased by 4%. According to Bloomberg experts, this sector may also include parts for aircraft and rocket engines, optical sights and other systems. Growth in these sectors contrasts sharply with a sharp decline in production in the civilian sectors, Bloomberg notes.

According to experts, in 2023 Russian industry due to military production will grow by another 2%. “The war in Ukraine will push industrial production even higher this year, up 2% compared to 2022, but at the cost of falling living standards and stagnant consumption,” said Oleksandr Isakov, an analyst at Bloomberg Economics.

The latest data on Russian industry were published at the end of December – then Rosstat reported on the results of November. According to Rosstat, in November industrial output grew by 1.6% (0.7% seasonally adjusted).

More details – in the material “Kommersant” “A lot of metal products”.

Olesya Pavlenko