Putin also gives up on Western sanctions, this is the proof

Jakarta, CNBC Indonesia – President Russia Vladimir Putin has re-opened his voice about the state of the economy of the country he leads. This was done when Western countries were still imposing economic and financial sanctions on Russia due to its attack on Ukraine.

In a statement to young Russian businessmen, Putin indicated the country’s economy was not strong enough to withstand western sanctions. He said that “relying on self-made goods will not reverse the country’s economic conditions” and so the Kremlin is looking for new trading partners.

“Import substitution is not a panacea. We are not trying to completely replace imports … Russia must collaborate with those who allow it to collaborate,” Putin was quoted as saying. AFPFriday (10/6/2022).

Under these conditions Putin emphasized that Russia should start developing its own knowledge. This is to fight technological dependence from Western countries which are currently embargoing the White Bear Country.

“But for such an important technology, we must have our own knowledge. We are developing it,” he explained.

Several important industries in Russia still rely on imported products for their development. One of them is the pharmaceutical industry, which is highly reliable in the manufacture of Covid-19 vaccines.

Previously, the Institute of International Finance, a global banking trade group, predicted that the Russian economy in 2022 would slow down by 15%. Meanwhile, in 2023, it will shrink by 3%.

The government’s regulation of the ruble, Russia’s currency, has partially protected its economy from the full impact of sanctions. The sale of oil and natural gas that had been armed with an obligation to pay in rubles and was still running smoothly, made him mighty.

Not to mention the rules of the Central Bank of Russia (CBR), which has raised interest rates. The government also enforces capital controls to prevent money from leaving the country.

However, the financial institution is of the opinion that sanctions have, in part, been encourage foreign companies to leave Russia. “(It) outlined its economy, erasing more than a decade of economic growth, and some of the most meaningful consequences are yet to be felt,” the Institute of International Finance said.

Previously, the forecast for the shrinking of the Russian economy was also published by the World Bank on Tuesday. The Russian economy is expected to contract this year by 11.3%.

[Gambas:Video CNBC]