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Russia Reform Monitor - No. 2106

Russians at risk of poverty;
Moscow extends an olive branch

Edited by Amanda Azinheira
December 19, 2016

November 9: 

Russia's economy may soon be on the road to recovery despite continued sanctions from the West. 
According to Reuters, the country's commodity dependent economy is expected to begin growing as early as next year as global oil prices recover. The World Bank expects the Russian economy to bottom out in the second half of 2016 and to grow 1.5 percent in 2017. 

The prognosis, however, is provisional. The World Bank notes that Russia's shrinking reserves - which are expected to continue to decrease over the next couple of years, and reach just 3.1 percent of GDP by the end of 2019 - have the power to imperil any economic rebound. "The vulnerability of the economy to external shocks requires the authorities to focus more on deepening structural reforms," the bank said in its report. 

November 10:

Ordinary Russians, meanwhile, are still feeling the pinch. 
The Moscow Times reports that more than half of all Russians are now at risk of falling into poverty. In the first half of 2016 alone, 14.6 percent of the country's population fell below the poverty line, and 51 percent are now considered "vulnerable" to poverty, according to the paper. The culprits are numerous, and include the Kremlin's ongoing (and extensive) military spending, which - when coupled with sanctions and falling oil prices - have had a pronounced negative impact on prosperity in the country. 

November 13:

Russia has added former U.S. Ambassador Michael McFaul to its sanctions blacklist, 
The Moscow Times reports. Under the new prohibition, McFaul - who served as Washington's envoy to Moscow between 2012 and 2014 - will no longer be allowed to travel to Russia. McFaul's ban comes as a response to U.S. visa sanctions on Russian citizens, and to his "actively taking part in the destruction of bilateral relations and his consistent campaign lobbying to pressure Russia," an official from the Ministry of Foreign Affairs has said. 

[EDITOR'S NOTE: The measure is a clear sign of the times - and of the extreme strained state of relations between the two countries. The last U.S. ambassador to Russia to be banned from entering the country was George Kennan, the author of the strategy to contain the Soviet Union that guided U.S. policy throughout much of the Cold War.] 

November 14:

Is Russia ready to make amends? 
Radio Free Europe/Radio Liberty reports that Moscow has said it is ready to work towards repairing relations with Washington once Donald Trump takes office in January. Deputy Foreign Minister Sergei Rybakov blamed the Obama administration for the current "deadlock" in U.S.-Russian relations, and expressed his optimism for a better relationship with the Trump White House, despite knowing "little of Trump's policy plans." Moscow's optimistic attitude is fueled by conciliatory comments made by Trump while still on the campaign trail about the need to improve bilateral relations between the two countries.

Related Categories: Russia; Russia and Eurasia Program

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