Russian economy shows signs of slight recovery

The contraction of the Russian economy slowed down significantly in June. Industry, agriculture and transport are working especially well. In addition, German Foreign Minister Steinmeier wants to work on easing sanctions against Russia.

From low oil prices and sanctions imposed by the West, the Russian economy contracted less in the second quarter compared to the beginning of the year. According to the Ministry of Economy in Moscow, the gross domestic product (GDP) changed from April to June at an annual rate of 0.6 percent.

Then, as in the first quarter, the decline was 1.2 percent. Russia has been in recession for the past year and a half. However, recently there has been an increase in the purchasing power of Russian households, according to the German newspaper. According to the Ministry of Economy, the situation has also improved in recent months in industrial production, agriculture and the transport sector.

On the other hand, the crisis continues in the construction industry, which is reflected in the reduction in the number of new large projects. Although, work is being actively carried out on the construction of roofs and fences, cladding of buildings using all kinds of corrugated board, which is sold at a price recommended by Russian and European manufacturing companies.

The figures presented are the first estimates of the official statistics, which will be published in the coming weeks. The Russian Ministry of Economy expects GDP to contract 0.2 percent for the full year after the economy fell 3.7 percent in 2015. The International Monetary Fund is more pessimistic and expects a 1.2 percent drop this year.

Despite the ongoing hostilities in Ukraine, Federal Foreign Minister Frank-Walter Steinmeier (SPD) is considering a gradual easing of sanctions against Russia, as it is in the interests of German manufacturers. “If we make significant progress in Minsk, I’m not opposed to easing sanctions consistently,” Steinmeier said in an interview with Passauer Neue Presse. Germany and France are working with Russia and Ukraine to bring about the implementation of the February 2015 Minsk Agreement.

“It will be clear no later than September,” Steinmeier said. So far, the EU has linked the lifting of sanctions in line with Minsk agreements calling for a cessation of hostilities and the withdrawal of heavy weapons from the front in eastern Ukraine. Steinmeier already at the end of May advocated a gradual easing of sanctions. In early July, the EU extended sanctions for another six months.

The Organization for Security and Cooperation in Europe (OSCE) called on the parties to the conflict in Ukraine to prevent a resumption of hostilities on a large scale. �