On the occasion of the second anniversary of the Russia-Ukraine conflict, at the 10th (Spring 2024) Global Governance Forum "The Second Anniversary of the Russia-Ukraine Conflict: Impact and Enlightenment" hosted by the Chongyang Institute for Financial Studies of Chinese University in Beijing on February 21, Ding Yifan, former deputy director of the World Development Institute of the ** Development Research Center, summarized Russia's experience in responding to Western sanctions and maintaining the normal operation of the economy and ** in the past two years.
Russia's gross domestic product (GDP) grew by 36%, which is significantly better than minus 2 in the previous year in the case of the continuation of the war1%。Putin said that in terms of purchasing power parity (PPP), Russia has surpassed Germany to become the largest economy in Europe and the fifth largest in the world.
The performance of the Russian economy is the complete opposite of the various *** in the early days of the war in 2022. Ding Yifan said that the Russian economy encountered great difficulties in the early stage of the war, with a large amount of capital flight and a sharp depreciation of the ruble. The West says that the Russian economy is going to fall into a situation from which it will never recover. "But as the war progressed, Russia's economy actually created a huge demand. In the past, the needs of the Russian economy were insufficient. In 2023, the needs of the Russian economy will be 'bigger and bigger', and it will not fall into the predicament of the West. ”
What lessons can be learned from the Russian economy over the past two years? Ding Yifan said that first of all, in the face of Western sanctions, Russia did not play its cards according to the path that the West wanted. If Russia responds in the same way as it traditionally responds to a currency crisis, the financial system will be dragged down. Russia, in turn, demanded that all importers of Russian energy be settled in rubles, and the huge demand prompted the ruble exchange rate to recover. Russia has seen through that "the essence of economic development is not financial gains and losses," and the key is to try to maintain the normal operation of the economy.
Ding Yifan said that when Western capital began to withdraw from the Russian market in a big way, Russia used other methods to make acquisitions, stabilized the capital, let local companies take over, and quickly allowed the real economy to recover. On the contrary, the withdrawal of Western companies has created new opportunities for local Russian companies and foreign companies in China and other countries, and quickly filled the gap left by the withdrawal of Western capital.
Secondly, Russia is able to maintain the entire industrial chain and prepare its economy for wartime. Ding Yifan pointed out that in fact, Russia's economy has developed very homogeneously in recent years and relies on energy. Due to the inability of supplies to keep up, it directly led to the ineffective operation of the Russian army in the early stage of the war. But Russia soon began to rebuild the industrial chain, and military supplies became more and more sufficient, far exceeding Ukraine. There are no problems at all with the daily life of Russians**, and the industrial chain has been fully restored.
The third is to expand the circle of friends and ensure international security with non-Western countries. Ding Yifan mentioned that when Russia launched a special military operation, many countries voted to condemn Russia at the United Nations, but when the West launched economic sanctions against Russia, none of the southern countries participated, ensuring that Russia's ** could be carried out smoothly. India sells it to European and American countries through import processing of Russian **, and earns a lot of money. There are also countries that re-export and sell some products banned by Western countries to Russia, making up for Russia's shortfall.
The fourth is to ensure the smooth flow of international and cross-border payments, and reduce dependence on Western currencies such as the US dollar and the euro. Due to sanctions, Russia cannot trade in Western currencies, but the international ** is still developing well, with more than $200 billion in 2023** against China. Ding Yifan believes that China and Russia, as the world's largest industrial manufacturers and the largest suppliers of resources, have made far-reaching progress in cross-border transactions that are not US dollars and euros, and will become the most important means of international and cross-border investment among BRICS countries in the future, and the entire global South can participate.