Russia's economy shows signs of resilience as GDP increases by 4.6%

By Al Mayadeen English
Source: Agencies
28 Feb 2024 21:19

As of February 26, the annual inflation rate was 7.58%, which is slightly higher than the 7.57% recorded a week earlier.

The headquarters of Russian gas monopoly Gazprom skyscraper is seen behind a Western Speed Diameter highway bridge in St. Petersburg, Russia, Tuesday, Oct. 10, 2023 (AP Photo/Dmitri Lovetsky)

The Russian Economic Development Ministry on Wednesday reported that the country's GDP has increased by 4.6% in annual terms in January from 4.4% in December

"According to the estimate of the Russian Ministry of Economic Development, in January 2024, the GDP exceeded the level of last year by 4.6% year-on-year compared to the 4.4% growth in December," the ministry said in a report.

The report added that the annual inflation in Russia stood at 7.58% as of February 26, slightly higher than the 7.57% recorded a week earlier.

"From February 20-26, 2024, dynamics of consumer prices amounted to 0.13%, year–on–year - 7.58%," the report noted.

These numbers promise to disappoint Western counterparts who have been actively working to weaken and contain Russia.

The country's economic resilience has indeed frustrated Western leaders beyond measure. Even more concerning is the reality that Russia has emerged as an example for other nations in how to resist US sanctions.

Seizure of frozen Russian assets

Recent efforts involve the illegal seizure of frozen Russian assets, which is estimated to total around $300 billion in Russian securities and cash. The funds have been frozen by the EU, G7 nations, and Australia, with the majority held in the EU.

While there was a belief that these funds should remain inaccessible to Russia unless it assists in Ukraine's reconstruction, there was disagreement over the legality of outright asset seizure.

To resolve this dispute, they sought guidance from a team of ten international law experts and practitioners, who unanimously affirmed in a joint letter on February 21 that the seizure of assets is entirely legal, citing Russia's ongoing special military operation in Ukraine.

"We have concluded that it would be lawful, under international law, for States which have frozen Russian State assets to take additional countermeasures against Russia, given its ongoing breach of the most fundamental rules of international law, in the form of transfers of Russian State assets as compensation for the damage that has resulted directly from Russia’s unlawful conduct," the experts in the letter, which was obtained by Bloomberg.

US sanctions

Another attempt at containing Russia involves sanctioning people and entities who are alleged to be involved in the war in Ukraine.

The US introduced 500 sanctions on February 24 as a result of Russian opposition politician Alexei Navalny who died on February 16. The US blamed Russia for Navalny's death despite the fact that no evidence pointed to it.

On the day of his death, US officials announced they would discuss a possible response with their allies, leading many to believe that Washington was possibly behind Navalny's death.