Russia's GDP falls 3.7% as sanctions and low oil price take effect

[uhnope]

Source: Guardian UK

Russia’s economy has recorded its steepest decline in gross domestic product since 2009 as the slumping oil price and international sanctions take their toll.

The fall of 3.7% comes as the Brent crude price hovers around $30 (£21) a barrel and the rouble trades near a record low to the dollar. Oil and gas account for around half of Russian state revenues and the government has said it will have to make cuts to the budget for 2016, which was adopted in October and based on an oil price of $50 per barrel.

Other economic indicators published by the state statistics service on Monday showed continuing heavy falls and a deterioration compared with previous months. Retail sales were down more than 15% year-on-year in December, while capital investment fell 8.7% year-on-year.

William Jackson, senior emerging markets economist at Capital Economics, said the weak activity data for December was worrying, pointing towards a deterioration towards the end of the quarter. “The data highlight that, while the worst of Russia’s crisis has now passed, the economy is still extremely weak,” he said. “The latest fall in oil prices and drop in the rouble mean the likelihood of a second consecutive year of recession is rising.

Read more: http://www.theguardian.com/world/2016/jan/25/russias-gdp-falls-37-as-sanctions-and-low-oil-price-take-effect

[nyabingi]

1. All of the Russophobes

are cheering and breaking out the champagne at this news.

These types of people love nothing better than to make people suffer in order to have things the way they want it.

[hack89]

3. All they have to do is give back Crimea and stop attacking Ukraine

and everything can go back to the way it was.

[wolfie001]

4. And stop throwing journalists out nine story windows and .....

.....stop serving polonium cocktails. Putin's a sick man.

[nyabingi]

12. Not gonna happen

as Crimeans overwhelmingly voted to rejoin Russia - they didn't want to live under the rule of leaders imposed on them from the US.

"Back to the way it was" is a funny statement lol. You mean back to us treating them the way we've always treated them, as enemies? Even when the Russians did all of the heavy-lifting and dying during WWII as we strode into France like we saved the day for the world.

[MariaThinks]

6. perhaps if russia stopped invading Ukraine, we would go back to our support for them.

[nyabingi]

11. And when have we ever "supported" Russia

or even tried to have good relations with them? Never.

Until they are finally conquered politically and brought under the heel of the American empire, they will always be cast as enemies. Read some history books and you'll see that what I'm saying is true. There's a reason the US brought former Nazi scientists here after WWII and gave them better treatment than we gave Black soldiers who fought against Germany.

[treestar]

21. You seem more to like Russia than us.

Are you sure you aren't Russian?

Just curious why you take their side vs. ours. On the other thread, you even hoped we suffer.

[nyabingi]

23. Because in dealing with other countries, especially

ones that choose a more independent course (i.e., outside of our economic sphere), we're straight assholes. There's no other way to put it. Every action we take overseas is done so that some rich people here in America can exploit either people or their resources - we simply don't deal with others as equals trading our goods for theirs.

After the fall of the Soviet Union, Russia really wanted to finally be included in the Euro-American club, but they soon found out that they were slated to simply be another rung on the ladder of American empire, a handful of wealthy oligarchs with the majority of the people barely making it. The United States has always resented Russian independence and have always, even during WWII, seen them as the real enemy. The neocons and their think tanks are literally obsessed with bringing Russia to its knees because of it.

What I wish would happen (as opposed to us suffering) is that the American people finally decide that the way we've done things isn't the moral or sustainable way to approach the rest of the world, and choose leaders who feel the same way. Most people seem to think that understanding foreign policy is something above their mental capacity, that it's best left to people who've studied at Harvard and Princeton. That's not true, and we all should be paying attention to what's happening.

Our ignorance is what made it easy for the Bush regime to lead us into destroying Iraq and the Middle East with it.

[Proserpina]

2. As compared to the US

which has been making up numbers since 2008, if not earlier....especially the unemployment numbers and the retail sales.

[uhnope]

7. lol. Despite the horrible machinations of Wall Street, the US economy is really robust

"making up numbers" or not.

I know that's really bad news to Putinistas

[FLPanhandle]

13. Conservatives have been accusing Obama of that for years.

I see that same idiocy has spread to some here.

I like how you chose 2008 as your starting point too.

A post right out of FreeRepublic.

[Proserpina]

14. People who can count (including some honest economists)

have proven it.

http://www.shadowstats.com/

Tell me, does everything you disagree with (or haven't bothered to investigate) automatically become "right wing"?

[FLPanhandle]

15. It's bullshit

As someone who makes his living in finance, this type of shit is always out there.

You are just repeating RW crap and, worse, are stupid enough to believe it.

[Proserpina]

16. If you made a living in finance, I might consider your opinion

[daleo]

5. Alberta, Canada is in the same boat as Russia.

The price of oil is down.

[polly7]

19. It's not just Alberta, it's the whole country.

I'm in Saskatchewan, people are being laid off right around me daily, houses are sitting empty for the first time in years, no-one is hiring. Our dollar is horrible.

The sanctions against Russia were the same economic terrorism as for anyone else and designed to do just what they are - ruin its economy. The west plotted and enabled the coup in Ukraine, Putin stopped Syria from being destroyed by regime change as Iraq and Libya were, when western powers first decided they were going to finally go for it - sanctions! I don't think all that many are fooled.

Makes me sick.

[daleo]

27. Canada focussed too much on oil production during the Harper years

Alberta and Saskatchewan, especially. But it's a boom and bust commodity, with wild price swings, so a country's economy and currency goes through crazy gyrations, if oil plays a major role. We need to diversify again.

As for Russia, I am just saying that the price of oil has probably had a much greater effect on their economy than western sanctions have had. Russia has weathered far worse storms than this one, though.

[Little Tich]

8. Wow, that's actually a substantial contraction.

Unfortunately, this will affect the average Russians the most, people who shouldn't be targeted by sanctions.

[moondust]

9. Unfortunately,

I believe polls show a whopping majority of average Russians strongly support their land-grabbing czar President, so that's too bad for them. I guess elections have consequences.

Russian President Vladimir Putin's approval rating has reached nearly 90 percent

[newthinking]

10. A historical perspective. Crimea was called the "Autonomous Republic of Crimea" for a reason

Russia did not take over Crimea, it simply kept the people there safe while their own Parliment (they had their own parliment, seperate from Ukraine) prepared the ballot. Crimea was always was closer to Russia and had fought on numerous occasions for autonomy from Ukraine. The 2014 coup in Kiev scared the crap out of people there and the rest is history.

The 2014 vote to unite with Russia was not the first such vote. They had voted for autonomy in 1994 and it was almost the same margin, 95%.

There was a compromise constitution that was overruled by the Ukrainian Parliament and Judicial, several fights over the crimea'n constitution.

How is this not part of the narrative?

Because if people know the truth and the history it becomes obvious and turns the narrative on it's head.


From Wikipedia:
http://en.wikipedia.org/wiki/Political_status_of_Crimea

Evolution of status of Crimea and Sevastopol within independent Ukraine
Autonomous Republic of Crimea

After the Crimean referendum of 1991, which asked whether Crimea should be elevated to a signatory of the New Union Treaty (that is, became a union republic on its own), Ukraine restored Crimea's autonomous status, but confirmed that autonomy restored as a part of the Ukrainian SSR. The Crimean Oblast council became Supreme Council of Crimea and, on 4 September 1991, passed the Declaration of state sovereignty of Crimea.[1]

Following the dissolution of the Soviet Union, the autonomy renamed itself the Republic of Crimea.[2] The Ukrainian government initially accepted its name, but not its claims to be a state. According to Ukrainian law "On status of the autonomous Republic of Crimea", passed on 29 April 1992, "Republic of Crimea is an autonomous part of the Ukraine and independently decides on matters, which are delegated to it by the Constitution and laws of the Ukraine" (art. 1).[3] The Regional Supreme Council, on the contrary, insisted that "Republic of Crimea is a legal democratic state", which "has supremacy in respect to natural, material, cultural and spiritual heritage" and "exercises its sovereign rights and full power" on its territory (art. 1 of the May 1992 Constitution), but also a "part of the Ukraine and establishes relations in it on a basis of the treaty and agreements" (art. 9).[4] Both Ukrainian law on autonomy status[5] and the 1992 Constitution of the Crimea[6] were amended later that year, putting the Republic's status in between what was proposed in the initial revision of the 1992 Constitution and what was proposed in April 1992 Ukrainian law on the status of the Republic.

On 21 May 1992 the Supreme Soviet of Russia declared 1954 transfer of Crimea as having "no legal force", because it was adopted "in violation of the Constitution (Fundamental Law) of the Russian SFSR and legislative process", but because subsequent legislation and the 1990 Russo-Ukrainian treaty constituted that fact, parliament considered it necessary to resolve the Crimean question in negotiations between Ukraine and Russia and on the basis of the popular will of the inhabitants of Crimea.[7] A similar resolution was adopted for Sevastopol a year later. Both moves were condemned by Ukraine[8][9][10] and resulted in no changes to the Russian Constitution (neither 1978 nor 1993 documents enumerated Crimea and Sevastopol as federal subjects).

In 1994, after parliamentary and presidential elections in the Republic, the Supreme Council and the executive became dominated by the Russian Bloc (which had won 57 seats in the Supreme Council of Crimea and Presidency for its member, Yuri Meshkov).[11] Following a referendum, held in same year, the Supreme Council of Crimea restored the 1992 Constitution to its original revision,[12] but a year later this constitution, along with the presidency and regional citizenship, was declared null and void by the Ukrainian Parliament, which by that time, had renamed the autonomy from "Republic of Crimea" to Autonomous Republic of Crimea.[13] Another Constitution was passed by Crimean parliament in 1995,[14] but many parts of it were rejected by the Ukrainian parliament; among them were Republic's name (which was to remain "Republic of Crimea&quot and citizenship.[15] Meanwhile, during drafting of the new Ukrainain Constiution, the question of autonomy was much debated: some legislators proposed abolishing it altogether (downgrading back to oblast status or to autonomy but not autonomous republic),[16][17] while other legislators proposed legalising the 1992 Constitution of Crimea provisions (original May revision) in the new Ukrainian Constitution.[16] Ultimately, the new Constitution of Ukraine adopted neither extreme and reiterated the autonomous status of the republic, while downgrading some of its powers (such as regional Supreme Council's powers to enact legislation in form of laws ("zakoni&quot ). The Republic was declared to be the "Autonomous Republic of Crimea", but also an "inseparable constituent part of Ukraine".[18] A new Crimean constitution, complying with provisions of the Ukrainian one, was adopted in 1998.

[LanternWaste]

17. I'd rationalize Moscow's expansion into the Crimea, Georgia and Ukraine too

I'd rationalize Moscow's expansion into the Crimea, Georgia and Ukraine too if my biases depended on doing so.

"Because if people know the truth and the history it becomes obvious and turns the narrative on it's head." It then becomes inexplicable as to why Moscow's state sponsored propaganda arms are consistently used by you as sources... unless of course, you simply hold Moscow to a much lower standard of truth-- which is most probable, regardless of your justifications otherwise.

[newthinking]

26. Wikipedia is now moscow propaganda? That is news to me? The Nation is Russia owned?

that is also news to me? CommonDreams? Project Censored? Foreign policy Journal? CounterPunch? Harper's? Democracy Now?

Wow that is one conspiratorial thread in your head.

I rarely post articles from RT although I did enjoy posting some Crosstalk last year and I have posted a couple of vids from RT over another source just to irritate one of our resident (and nasty) red baiters. You are getting people mixed up.

[polly7]

20. Great informative post, newthinking. nt.

[moondust]

22. How much

did Kiev invest in Crimea between 1954 and 2014 in terms of infrastructure, utilities, medical facilities, goods, services, voting rights, etc.? Why didn't Putin offer to negotiate a buyout instead of simply grabbing it using armed masked men and the threat of greater force? Could it be because it would have cost a pretty ruble to buy Crimea, while Putin knew his superior armed forces could easily usurp it for free?

I kinda think Putin was afraid of Kiev getting cozy with the EU and USA and at some point he might lose full access to his naval base at Sevastopol. The very same fear may very well be behind Assad's brutal intransigence in Syria and the presence of the Russian military there. Putin wants his empire to grow and is afraid of it shrinking instead.

Incidentally, from a historical perspective, Crimean Tatars constituted the majority of Crimea's population from the time of its ethnogenesis until mid-19th century, and the relative largest ethnic population until the end of 19th century.

[newthinking]

24. Ukraine looted Crimea. They took most of the tax collections and did little with infrastructure

Ukraine was never good to Crimea.

Crimea never would have been "cozy" with the US. Hell, there were protests in 2006 when there was talk about a joint military facility with the US as people thought it would be the first step toward NATO.

2006 anti NATO protests in Feodosia

[Sunlei]

18. the local population is too 'leaded-up' from their $2.00 a gallon gasoline to care much.

On the positive side, Russia just cut the minimum price of vodka 16% so the locals would make less moonshine.