Russian President Vladimir Putin is not happy with the current state of the Russian economy, and has ordered the Bank of Russia and finance ministers to come up with ways to fix it.
Putin raised the issue of falling incomes at a meeting with Central Bank Governor Elvira Nabiullina, Economy Minister Maxim Oreshkin, Finance Minister Anton Siluanov and presidential aide Andrei Belousov, reported The Moscow Times, where he praised the drop in inflation from double digits several years ago to its current 4.5%.
“Even against this background, and given the increase in wages in the economy, people’s real incomes are growing slowly. This state of affairs cannot but cause concern,” Putin said.
“The pace is certainly positive but the overall dynamics can’t be satisfactory for us. We need to make economic growth more sustainable and dynamic.”
Average Russian citizens have seen their incomes shrink as Western sanctions have hit the Russian economy hard. Spending on medical care, education, and other social needs has dropped. Even the Russian military has recently seen a reduction in outlays from previous years.
Households’ real disposable incomes, or the money they have left after taxes and inflation are taken into account, rose 0.1% in 2018 after falling for several years in a row. In the first half of 2019, they dropped again by 1.3% compared with a year ago, wrote The Moscow Times.
The Kremlin has been accused of starting offshore conflicts in order to appeal to patriotism and take Russian attention off economic problems.
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