russia Is Sliding into a Decade of Stagnation

For the first time since the start of the full-scale war against Ukraine, the kremlin has officially acknowledged that russia’s economy has lost momentum and entered a period of stagnation. The decline in GDP appears to be rapid and inexorable: after 4.5% growth in the fourth quarter of 2024, the figures dropped to 1.4% in the first quarter of 2025, 1.1% – in the second, and only 0.6% – in the third. This sharp slowdown demonstrates a systemic crisis, which the authorities are trying to hide behind euphemisms such as “planned cooling” or “reduction of overheating”.

The rhetoric of government officials and the central bank cannot mask the obvious deficit in both the federal budget and the regions. This is only the beginning of a long period of losses, which moscow itself acknowledges: russians will have to “pull in their belts” until at least 2042.

At this point, the country is effectively doomed to a permanent budget deficit. The key factor will be the decline in oil and gas revenues, which are expected to drop by 43 % compared to 2019 levels. This trajectory means not temporary difficulties, but a deep and prolonged degradation of the economy. russia is entering a decade where recovery seems unlikely and financial losses – inevitable.