Russia's Booming Economy

Russia is widely known for being an authoritarian state led by the dictatorial leader Vladimir Putin, who's actions in Ukraine caused a plethora of sanctions to rock the large transcontinental state. At first, Russia's economy sunk tremendously and its currency, the ruble, lost majority of its value in just a few months.

Russia, on the contrary, witnessed an economic boom amid heavy western sanctions in 2024. It GDP soared by 3.59% in 2023, and in 2024, it is projected to grow by a respectable 2.9%, according to The European Commission. But why is Russia growing by this much, even despite the heavy western sanctions?

The answer lies to the south of Russia: China. China, due to pressure from the West, was forbidden to sending weapon shipments and military volunteers into Russia, but it was still able to trade for raw materials. Russia is a key supplier of oil, natural gas, tungsten, steel, chromium, gold, and uranium, key resources which China largely lacks. China requires these resources to feed its massive manufacturing economy, grow its military as a contender to the United States, and to sustain its massive 1.4 billion population.

In order to grow supply to meet Chinese resource demands, Russian companies and the state funded mining and resource extraction projects in many areas still clustered in resources, helping Russian businesses grow while providing jobs to thousands of Russians.

This growing trade relationship caused a massive inflow of Chinese yuan, which is a much more stable currency than Russia's ruble, to enter the country. Previously held by the strong U.S. dollar as well as the Euro, Russia's most used currency for trading shifted to China's currency, further harming western influence while supporting China's initiative for financial independence from the West.