Russia's war-driven economy is so hot that the World Bank upgraded it to a 'high-income country'

Yahoo News ^ | July 3, 2024 | Huileng Tan

[Trump20162020]

Russia's economy has defied sanctions in the two years since Moscow invaded Ukraine in February 2022 — so much so that the World Bank is now classifying Russia as a "high-income country."

On Monday, the World Bank announced it has upgraded Russia from an upper-middle-income country to a high-income country, according to a report from the financial institution's economists.

"Economic activity in Russia was influenced by a large increase in military-related activity in 2023," World Bank economists wrote in their report.

Russia's trade jumped by nearly 7% last year, while activities in the financial sector and construction grew by 6.6% and 3.6%, respectively.

This boosted Russia's real GDP — which is economic growth adjusted for inflation — by 3.6%.

The development has made some poor Russians better off financially, complicating any calculus over how to end the war.

[E. Pluribus Unum]

Bet the CIA didn’t see this coming when they instigated a proxy war with Russia.

[canuck_conservative]

Well of course spending is up, Russia is at war

Nazi Germany had a record GDP in WWII too, duh

But what isn’t mentioned here, is that Russia’s revenues are DOWN - Vlady’s stupid decision to cut off gas flows to Europe (Sept. 22) and the oil sanctions have really hurt Russia

That’s why Vlady is so desperate to end the war, using clumsy weekly nuke threats and constant calls for Ukraine to surrender

[Bulwyf]

At least change your handle to something more realistic.

[Zhang Fei]

Ukraine ping

That’s the way war works. It’s a gigantic economic bubble, not very different from a housing or stock market bubble. The big downside is that unlike homes (2008 housing bust) or fiber optic cable (2001 internet bust), you can’t do much in peacetime with surplus military equipment at the end of a war. Which is why recessions, and sometimes depressions, follow the end of hostilities. So the temptation is to keep going, extend the bubble, by pushing on until an opposing force finally makes further territorial gains impractical.

Just as Russian production spiked, so did Ukraine’s, taking it from one category to another.

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[Ukraine also moved up from a lower-middle-income country to upper-middle-income country as real GDP grew 5.3% — reversing a steep 28.8% slump in 2022.]

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The downside is when the war ends, a hangover will ensue. Postwar, Europe endured years of hunger, which triggered the Marshall Plan.

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https://cepr.org/voxeu/columns/famines-wwii#:~:text=Finally%2C%20the%20famines%20that%20followed,Soviet%20famine%20of%201946%2D47.
[Finally, the famines that followed in the wake of WWII are part of the reckoning. In February 1946, US President Truman warned of a global famine that “may prove to be the worst in modern times”. One famine cost 100,000 lives in Tokyo in the second half of 1945; another was the Soviet famine of 1946-47. The latter was proportionately most severe in Moldova, where 100,000 or 5% of the population perished, but most costly in numbers of lives in Ukraine (300,000) and elsewhere in the Soviet Union (500,000) (Ellman 2000: 611-617, Vallin et al. 2012: 70). Elsewhere, despite Truman’s warning, malnutrition was widespread but famine was averted (Aldous 2010, Collingham 2011: 467-474).]

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The quest for loot through territorial gain to avert this outcome is one reason why armies keep going.

Re WW2, the US economy boomed postwar because all the New Deal restrictions that prevented the economy from coming out of the Great Depression also went away with war’s end. A number of civilian technologies also came out of the war that supercharged American economic growth. Some of those technologies are explored at this link:

https://www.nationalww2museum.org/war/articles/scientific-and-technological-advances-world-war-ii

But two key technologies that came of age in the US aren’t even touched upon - plastics and vulcanization. There are several more. Plastics is covered here:

https://www.solentplastics.co.uk/news/how-plastic-was-crucial-to-the-war-effort/

Note that the Russian empire had under 10% of its lands occupied and a smaller % of its infrastructure destroyed. Yet it encountered postwar famine.

https://en.m.wikipedia.org/wiki/Soviet_famine_of_1946%E2%80%931947#:~:text=The%20Soviet%20famine%20of%201946,900%2C000%20perished%20during%20the%20famine.

A key factor differentiates the US from Russia and most other countries. It’s encapsulated in Stalin’s statement: “The United States is a country of machines. Without the machines we received through Lend-Lease, we would have lost the war.” Relentless technological innovation powered the US through the postwar period, just as the Second Industrial Revolution (railroads, telegraph, et al) got the US through the post Civil War era.

When conversations about Russia get started, technical innovation in the civilian sector is not something that usually comes up. A country whose Motor Rifle Divisions are resorting to dune buggies, motorcycles and 50s era tanks, with no history of domestic civilian innovation, is unlikely to have a postwar technology-driven economic revival.

Besides, even the US isn’t immune to postwar recessions. Korea and Vietnam were both followed by recessions. And this is in a country that sprang from an acorn to become a mighty oak, a nonentity in 1776 that grew to become the biggest economy in the world by 1900. Whereas Russia’s record is of generalized waste and incompetence.

[Vermont Lt]

The average income in Russia is $14,177.

Just sayin’.

[BobL]

So much for the Neocons COLLAPSING the Russian economy as they PROMISED THE WORLD would happen. LOL!!!!!

I understand the butt-hurt on the part of the Zeepers as yet another Neocon scheme bites the dust, but just for the record, Russia’s military spending is now up to 6% of GNP, still not as high as ours was during World War 2, or even Vietnam (which was 10% but did also include the Cold War).

The bottom line is that the Russians pretty much got the message in 2014 from the Neocons (after having liberated Crimea) that they needed to pull-in production and develop workarounds to the West and its puppet states, and they have.

So, yet another Neocon ‘project’ bites the dust and it would be laughable except for the HUGE DAMAGE they are in the process of doing to the US, meaning us and our children and grandchildren. But that is overhead of the Zeepers, so I won’t bother with details of the new, emerging, political alignment - other than say that we will be on the OUTSIDE, this time, and it will not be fun.

[Navy Patriot]

Russia's war-driven economy is so hot that the World Bank upgraded it to a 'high-income country'

Maybe, after the war is over, Russia will return all the captured foreign weapons to the foreign nations that supplied them.

[Chad C. Mulligan]

......where 20% of the population doesn’t have indoor plumbing....

[Trump20162020]

And all the NATO wunderwaffe weapons still haven’t won against that? Yikes...

[wildcard_redneck]

"But what isn’t mentioned here, is that Russia’s revenues are DOWN - Vlady’s stupid decision to cut off gas flows to Europe (Sept. 22) and the oil sanctions have really hurt Russia."

If Russia is hurting so badly then why is Europe importing more energy from Russia than from the U.S.? You are being lied to or are lying to us. In May of this year Europe imported more gas from Russia than the U.S.

Russia overtook US as gas supplier to Europe in May
Rise in market share highlights difficulty of weaning the region off Russian energy
Europe's gas imports from Russia overtook supplies from the US for the first time in almost two years in May, despite the region's efforts to wean itself off Russian fossil fuels since the full scale invasion of Ukraine.

While one-off factors drove the reversal, it highlights the difficulty of further reducing Europe's dependence on gas from Russia, with several eastern European countries still relying on imports from their neighbour.
https://www.ft.com/content/15e7b892-c4f3-45b8-b375-80ef52e4b83c

[adorno]

Did you bother to read the post by 'canuck-conservatie"? post?

But what isn’t mentioned here, is that Russia’s revenues are DOWN - Vlady’s stupid decision to cut off gas flows to Europe (Sept. 22) and the oil sanctions have really hurt Russia

That’s why Vlady is so desperate to end the war, using clumsy weekly nuke threats and constant calls for Ukraine to surrender

Why do you get so giddy whenever Russia seems to have any kind of success, real or imagined?

One thing about Zeepes or neocons, as you label them, they don't root for the enemy, that being Putin and Russia. Why do you?

[blitz128]

Think you are being generous

[PGR88]

Bet the CIA didn’t see this coming when they instigated a proxy war with Russia.

The CIA specializes in always getting the big picture wrong

[Cold Heart]

“You can’t do much in peactime with military equipment at the end of a war”.

We on the other hand have Sportsman’s Guide:)

[BobL]

“Did you bother to read the post by ‘canuck-conservatie”? post?”

No, I trust the World Bank far more than some Zeeper spouting Neocon talking points, which have been PROVEN WRONG far more often than proven right.

It may sting, but the World Bank says that Russia is now HIGH INCOME and its economy is growing FASTER than any country imposing ‘sanctions’ on them. Also, their ppp-GNP is now 4th in the world, exceeded only by China, the US, and India, as they surpassed Japan last month and Germany last year. In fact, Putin had said that he could have never instituted the reforms that have made Russia an economic powerhouse without the ‘sanctions’ from the Neocons, as they would have never been approved otherwise.

Sorry to ruin your day, but please take your complaints to the WORLD BANK, not the people who simply report on what the WORLD BANK is saying. In case you don’t have it, here’s their address (and note that they are in Washington DC, not Moscow):

1818 H Street, N.W., Mail Stop MC 13-1302, Washington, DC 20433 U.S.A.

[PGR88]

they don't root for the enemy, that being Putin and Russia. Why do you?

Yeah, Putin and Russia are not my enemy, nor the enemy of normal Americans. He's the imagined enemy-of-the-day for fetid, thieving, budget-skimming neocons in DC

Try again

[BobL]

Yep, the Zeepers seem to keep falling back to that Putin-Puppet Neocon Talking Point - but we have to understand their butt-hurt, they have been WRONG (and/or lying) about EVERYTHING regarding the Ukraine War, and it’s becoming quite OBVIOUS to the people here, and even much of the West (the rest of the world figured it out long ago).

So we must comfort them...as their whole plan for World War 3 looks further and further from reach.

[Deaf Smith]

After the Berlin Wall fell, lots of military stuff from E Germany came up for sale by way of Sportsman’s Guide.

[Vermont Lt]

I don’t know…my friends don’t constantly threaten to burn my home down with nukes. Maybe you need better friends.

But if you are Russian it explains your sadness about no one liking your country. Good news is that the ratio of women to men keeps going higher!