Support The Moscow Times!

Poor Russians to Blame for Ailing Economy, Official Says

Petr Kovalyov / TASS

A senior Russian government official has linked the country’s sluggish economic performance to poor Russians with low purchasing power.

Although Russia climbed out of recession in 2017 and is on track to achieve 2 percent GDP growth despite low oil prices and western sanctions, official data indicates that real wages have decreased for four years in a row.

Deputy Prime Minister Olga Golodets warned on Wednesday that economic development would face "serious difficulties" if the decline in wages was not reversed.

"These days, it’s the population’s income that’s the most basic constraint on the development of demand and, consequently, on sustained economic growth," Interfax cited her as saying.

Golodets called on employers across all sectors to raise the minimum wage and replace inefficient jobs with machines.

"Moreover, it would be ideal if these machines were manufactured in Russia," she was cited as saying by the RBC business portal.

With the approaching elections next month, President Vladimir Putin has pledged to raise the minimum wage this spring.

Read more

Independent journalism isn’t dead. You can help keep it alive.

The Moscow Times’ team of journalists has been first with the big stories on the coronavirus crisis in Russia since day one. Our exclusives and on-the-ground reporting are being read and shared by many high-profile journalists.

We wouldn’t be able to produce this crucial journalism without the support of our loyal readers. Please consider making a donation to The Moscow Times to help us continue covering this historic time in the world’s largest country.