- Russia’s economy is in tatters, despite what its central bank says, according to Yale researchers.
- In a recent op-ed, two academics called Russia’s growth forecasts a figment of Putin’s imagination.
- Stats outside of what is stated by Russia suggest its economy has been hit hard by sanctions.
Russia’s economy is in tatters, and economic stats touted by the country’s central bank are “pure invention” from Russian President Vladimir Putin, according to two Yale researchers.
In an op-ed for TIME on Tuesday, Jeffrey Sonnenfeld and Steven Tian, two academics at the Yale Chief Executive Leadership Institute, blasted Russia’s economic forecasts, with the nation’s central bank painting an image of resilience amid western sanctions and Russia’s costly invasion of Ukraine.
The central bank recently adjusted its GDP outlook, estimating its economy to grow 1% or contract 1% this year, though it previously estimated a 1%-4% contraction. But those numbers are “fictional,” Sonnenfeld and Tian said.
“Since the Ukrainian invasion, our data has shown that the Kremlin’s economic releases have become increasingly cherry-picked, selectively tossing out unfavorable metrics while releasing only those that are more favorable,” the academics said.
They pointed to unreleased statistics that paint a bleaker picture of Russia’s situation, including the nation’s exports and imports, capital inflows and outflows, and output data for oil and gas.
“Thus the Russian GDP number is a pure invention from Putin’s imagination,” the researchers said. “The Putin-selected statistics are then recklessly trumpeted across the world media and relied upon by careless experts in constructing ludicrous forecasts which are unrealistically favorable to the Kremlin.”
Sonnenfeld and Tian were particularly critical of the International Monetary Fund, which have factored in Russia’s economic projections in their own analysis of the nation’s economy. The IMF currently estimates Russia’s GDP to grow by 0.7% in 2023, but Sonnenfeld and Tian claim that the organization’s economists have privately admitted they have “zero visibility” into the actual state of Russia’s economy.
Estimates outside of those offered by Russian officials suggest the country’s economy has been battered over the past year. By some accounts, Russia’s energy revenue has tanked amid the EU’s Russian oil ban and $60 price cap, and other major sectors of its economy have plunged 60%-95%, Sonnenfeld and Tian estimate.
Other experts also have a poor outlook for Russia’s economy, largely due to the nation’s isolation from global markets and its de-investment in technology. The nation could become a failed state by the end of the decade, according to one think-tank. The World Bank, Morgan Stanley, and Goldman Sachs all expect Russia’s economy to contract this year.
“Putin is losing the military war, the diplomatic war, and the economic war. He must not win the disinformation war by western media and policy makers naively falling for his fake economic data,” the researchers said.