Mishustin said the strongest sanctions strike on the country in modern history

Last year, Russia and its people suffered the strongest sanctions blow in the modern history of the country, Prime Minister Mikhail Mishustin said, speaking to the State Duma with a report on the work of the government in 2022.

“I think there is no need to explain in this hall the conditions under which everyone had to work. Sanctions hit Russia. There was no equal in strength to which in recent history. At the very beginning, the West tried to assure that the sanctions were not directed against our citizens … But now, even a person far from global politics understands that the main goal was the Russian people,” he said.

In particular, Western countries tried to bring down the Russian financial system so that Russians could not use bank cards, as well as disrupt economic and business ties, the prime minister said. Western companies, under pressure from their authorities, left Russia, incurring huge losses and “throwing out” Russian employees, in order, among other things, to provoke mass unemployment and radically reduce the quality of life, he added.

Mishustin also pointed out the discrepancy between the words of Western representatives about the “sanctity” of private property with the arrests of assets of Russian individuals and companies abroad that began in 2022 “just because they are from Russia.”

“Last year, we had to respond almost every day to the challenges associated with the next set of sanctions. They demanded an immediate response. The constant search for an answer to the question – what will happen next, ”Mishustin emphasized.

While working on countermeasures, the government and other authorities were also laying the foundation for a further transition to economic growth and achieving national benchmarks, he said. The decline in national GDP, inevitable under the current conditions, turned out to be quite confident, and now the economy has been returned to a growth trajectory. As Mishustin recalled, even some international institutions predict positive dynamics in 2023 and growth in 2024.

“This is not the first time our economic system has shown such flexibility. In covid 2020, it also proved to be more resilient than expected. We went through that crisis more confidently than many Western countries, where the decline in GDP was much greater,” the prime minister added.

The Cabinet of Ministers and the Central Bank, Mishustin continued, also managed to quickly stabilize the work of the country’s financial system, avoid external blocking of trade operations within the country thanks to the built-in national payment and settlement infrastructure. The substitution of the dollar and the euro made it possible to expand operations with countries friendly to Russia.

In total, over 300 measures out of more than 33,000 proposals were included in the plan of priority actions to ensure the development of the economy under sanctions. By June, the impact of negative factors had been significantly reduced, and by the third quarter, the Russian economy came out with a certain “margin of safety,” Mishustin emphasized.

On February 10, the Bank of Russia updated its medium-term macro forecast, improving estimates for the economy this year. According to the regulator, the dynamics of GDP will be in the range from minus 1% to plus 1% (in the previous version of the forecast, the Central Bank expected a decline of 1-4%). At the same time, the estimate for next year has been downgraded to an increase of 0.5-2.5% compared to 1.5-2.5%.

According to the current forecast of the Ministry of Economic Development, in 2023 the Russian economy will decrease by 0.8%, and in 2024 it will grow by 2.6%. Inflation at the end of this year is expected at 5.5%, and the government expects it to return to the target of 4% in 2024. Investment in fixed assets will decrease by 1% in 2023, real disposable income will grow by 1.6% follows from the forecast.