Nine months after beginning its offensive in Ukraine, Russia has entered a recession as a result of the economic pressure caused by Western sanctions, according to official figures released on Wednesday.
In the third quarter, GDP decreased by four per cent, according to a preliminary estimate by the national statistics office Rosstat.
With two consecutive quarters of declining GDP, which follows one of a similar size in the second quarter, Russia now satisfies the technical criteria for a recession.
The decrease in economic output between July and September was four per cent, which was less than the 4.5 per cent reduction that many economists had predicted.
A 22.6 per cent decline in wholesale trade and a 9.1 per cent decline in retail trade were the main contributors to the contraction.
Agriculture increased by 6.2 per cent, and building increased by 6.7 per cent.
Exports and imports, notably those of essential industrial parts and spare parts, have been restricted by Western sanctions.
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As a result of a partial mobilisation that forced several hundred thousand men out of labour, businesses have also been struggling with a staffing shortage.
Rosstat reports that even though the economy is shrinking, the unemployment rate in Russia was only 3.9 per cent in September.
As a result, the Russian economy has grown even more reliant on energy exports, which have generated around 40 per cent of the country’s total income.
(with inputs from agencies)
