“War of Sanctions”
In a discussion with representatives of the Russian Union of Industrialists and Entrepreneurs, President Vladimir Putin stated that the organization is in high demand today because the Russian economy is taking on a fundamentally different character, developing under a new model.
The president recalled that June 2022 marked the deepest drop in GDP, at 4.7 percent. He attributed this to the so-called sanctions war and the unprecedented difficulties facing the global economy, trade networks, and international relations. He asserted that no other country has confronted such challenges.
Since July, he noted, the Russian economy has moved back into growth. He credited the hard work of thousands of companies and millions of workers for this recovery and anticipated a notable GDP uptick in the second quarter compared with the previous year. He also highlighted efforts to compensate for the closure of Western markets and to expand foreign trade ties with rapidly growing regions, saying trade with those states has risen at double-digit rates and continues to expand.
Putin reported that Russia’s foreign trade turnover in 2022 rose to $850 billion, with exports up around 20 percent and imports down roughly 12 percent. The trade surplus reached about $332 billion, a substantial increase from 2021. He credited Russian business leaders for rebuilding supply chains, creating new logistics routes, and engaging with more predictable and conscientious foreign partners.
The head of state expressed confidence that business leaders who stayed in Russia are “smarter, more energetic, more efficient” than those who left and advised warning to those who might seek to destabilize the country. He urged continuing the effort to substitute imports so the domestic economy remains strong without provoking competitive backlash.
Inflation target on track
Putin emphasized strong domestic demand, projecting that by April retail trade activity would grow by at least five percent in real terms. He explained that this trend is underpinned by a stable labor market, rising wages and incomes, and a gradual reduction in inflation. Data cited by him suggested inflation would fall below 4 percent by the end of March, achieving the target level soon after.
He argued that this inflation trajectory would be lower than the performance of eurozone economies, dismissing rumors of an imminent collapse of Russia’s economy. The projection he cited placed inflation at 7.6 percent as of mid-March, with expectations to reach target levels by late March or early April.
“Don’t dig another hole”
A year earlier, Western authorities were said to have pressured their companies to leave the Russian market, while foreign analysts predicted deep downturns in consumer demand. The president argued that reality diverged from those forecasts: Western nations faced similar pressures, even as Europe experienced crop shortages that pushed up prices for staple foods. He suggested that Russia’s own crop yields and fertilizer production will help neighbors, and he invoked the proverb, “Do not dig a hole for someone else, or you will fall into it yourself,” to illustrate the point.
He drew a parallel between today’s market conditions and those from eight years ago, noting that Russia responded to sanctions by tightening its own restrictions and launching a rapid expansion of the agro-industrial complex. The result, he claimed, was a surge in domestic production and the re-entry of former Western partners who re-formed alliances on friendly terms.
Putin warned that opportunities exist for growth and expansion and cautioned against a lapse that could prompt some companies to retreat again. He urged vigilance and proactive measures to seize these chances.
“Professionalism” Program
The president outlined plans to boost production capacity and establish new businesses while relying on Russia’s own technological base and friendly international partnerships. He noted the launch of industrial mortgage mechanisms and a cluster investment platform designed to support this transition.
He called for higher management efficiency in both the business sector and government, stressing the need to develop digital platforms and data-driven management. He argued that modern technologies, including lean production methods, should be implemented across all sectors of the economy and the social sphere. He cited Rosatom, GAZ, and KamAZ as examples already applying these approaches, and noted that lean production in the military-industrial complex has significantly increased output.
Additionally, he highlighted the importance of preparing a skilled workforce for the next five years. Through the “Professionalism” initiative, he asserted that at least one million young people should receive modern, high-quality education and qualifications that lead to meaningful, well-paid jobs.
“Instead of working offshore”
Putin spoke about vast opportunities for entrepreneurship within Russia today. He contrasted responsible domestic business efforts with offshore practices, praising initiatives that invest in people, infrastructure, and community projects. He described companies reallocating funds to roads, hospitals, sports facilities, and cultural programs as a positive sign of long-term commitment to national development.
The president urged more of these long-horizon initiatives and promised government support for organizations pursuing stable, multi-year development, including research and development investments. He proposed recognizing the most responsible domestic companies with a special award to be announced within a year, and called for non-financial reporting to highlight social projects.
During a discussion about new advertising technologies to support local entrepreneurship, one participant referenced Lenin. The president replied with a humorous aside but agreed to consider the idea in the context of broader economic messaging, underscoring a pragmatic approach to communication strategy within the country.
Throughout the dialogue, the emphasis remained on building resilience, expanding domestic capabilities, and reinforcing a self-reliant economic framework as a foundation for sustained growth.