Russia faces economic stagnation due to sanctions, falling currency

G20 Summit

Russia’s economy is experiencing capital flight, falling value of its ruble currency, inflation, and a virtual freeze on international investment. Following sanctions over its actions in Ukraine, international businesses have withdrawn from Russia and some multinational companies have even deciding to close their Russia offices. CCTV America’s Anya Ardayeva reported this story from Moscow.

The ruble has fallen in value nearly 30 percent against the dollar so far this year. Russia’s central bank has stopped interventions to protect the currency, but predicted that private sector capital outflow will increase sharply to reach $128 billion this year, and the bank forecast three years of economic stagnation.

Western sanctions over the Ukraine crisis has shaken trust in Russia’s financial policy and reduced Russia’s exports and investment flows.

“In any situation where investors don’t know what’s going to happen next, they try to move their capital, regardless of the losses, just so that they aren’t investing in a story that they don’t know the end of,” said Arterm Argetkin, a financial analyst. “If the situation gets worse, if Russia becomes further isolated from the EU and the U.S., if we close off from external partners, then it’s understood that the remaining portion of foreign investors will also leave.”

In September software giant Adobe decided it wasn’t worth the cost of keeping their office in Russia open.

Russia faces economic stagnation due to sanctions, falling currency

Russia’s economy is experiencing capital flight, falling value of its ruble currency, inflation, and a virtual freeze on international investment. Following sanctions over its actions in Ukraine, international businesses have withdrawn from Russia and some multinational companies have even deciding to close their Russia offices. CCTV America’s Anya Ardayeva reported this story from Moscow.


Fariborz Moshirian of University of New South Wales discusses G20

CCTV America’s Michelle Makori interviewed Fariborz Moshirian, the Director of the Institute of Global Finance at the University of New South Wales, about the state of the global economy.

Fariborz Moshirian of University of New South Wales discusses global economy

CCTV America’s Michelle Makori interviewed Fariborz Moshirian, the Director of the Institute of Global Finance at the University of New South Wales, about the state of the global economy.