In a surprisingly transparent statement, one of Russia’s highest economic authorities acknowledged the nation’s grim financial situation.
Economy Minister Maxim Reshetnikov made the observation during his appearance at the Saint Petersburg International Economic Forum (SPIEF), a preeminent gathering of government and business leaders intended to showcase Russian investment opportunities.
“According to the figures, there is cooling, but all our figures are in the rear-view mirror,” Reshetnikov said during his appearance on a panel at the SPIEF.
“According to the current feelings of businesses and business indicators, we are already, it seems to me, on the verge of going into recession,” he continued. “On the verge.”
Pressed for further comment by reporters after the panel, Reshetnikov emphasized he “didn’t predict a recession” but only that Russia was “on the brink.”
“From here on out, everything will depend on our decisions,” he said.
The economy minister’s remarks were unusually transparent for a Russian official, most of whom have done their best to downplay the negative effects of their country’s ongoing invasion of Ukraine.
The price tag for the war itself can be difficult to estimate.
The International Institute for Strategic Studies released a report in February estimating that Russia’s military expenditure in 2024 shot up to approximately $145.9 billion — just under 7% of its gross domestic product. The Stockholm International Peace Research Institute has offered similar estimates in its reports.
Equally concerning for Russian economists are the second-order effects the war has brought to the country’s international business.
Western actions taken since the launch of the Russian invasion in 2022 have resulted in over 20,000 trade restrictions against the government, businesses, and individuals.
Russia quickly became the most widely-sanctioned nation on Earth, surpassing its allies Iran and North Korea by a wide margin.
The United Kingdom and the European Union are spearheading a campaign to impose yet another round of sanctions on Eastern European powers, but the United States has been hesitant to join their cause.
President Donald Trump was asked by reporters at the G7 summit this week whether he is open to expanding the country’s already hefty restrictions. He pointed the finger back at the European leaders and insisted he will not be the first to take such a step.
“Let’s see [Europe] do it first,” the president told. “It’s not just, let’s sign a document. You’re talking about billions and billions of dollars. Sanctions are not that easy. It’s not just a one-way street.”
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Trump continues to publicly voice frustration with Russian President Vladimir Putin for failing to take peace negotiations seriously.
He recounted on Wednesday a phone call he received from Putin earlier in the day, in which the Russian leader offered to help mediate peace talks between Israel and Iran.
Trump claimed to reporters that he responded: “Do me a favor, mediate your own. Let’s mediate Russia first, okay?”