Russian Economic Slowdown Essay

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The Russian economy has induced drastic changes over the years. In the 1990s there was a sharp increase in privatization of government assets, the introduction of radical market principles concerning the economy and commerce and the deregulation of many branches of the Russian economy. Today the government attempts to modernize the economy, redistribute resources, and create a more efficient economic and financial system. When Putin became president he supported policies that were based on free market principles, but with substantial government regulation. There are several government agencies that are involved with the economy of Russia. There are ministries that are under the control of the Russian Federation’s Government. However, today because of various factors the Russian economy is in turmoil. To better regulate the economy one must first focus on the current aspects of the Russian economy Before identifying the factors of the Russian economic slowdown, it is best to identify current features of the Russian economy. According to the Heritage Foundation Russia has the 143rd freest economy in 2015. There population is 142.9 million with a 5.8% unemployment rate. The inflation rate is 6.8%. Russia’s GDP is $2.6 trillion and $17,884 per…show more content…
Capital flight has increased, inflation has increased and the ruble has fallen by more than 50 percent. Analysts have argued that the sanctions are at least one contributing factor of the economic situation in Russia. The Russian economy is contracting. The government responded to the sanctions by increasing the cost of goods in their local currency, resulting in inflation and they decreased the quality to goods available locally in Russia. The country is dependent on imports and has had to seek assistance from the Commonwealth of Independent States. This had decreased competition and allowed competitors to raise their

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