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Economics

Russia’s Economy Facing Worst Contraction Since 1994

  • GDP may shrink 12% on sanctions, internal forecast shows
  • Finance Ministry sees worse contraction than Economy Ministry
People walk past an empty retail space on Tverskaya street in central Moscow on March 16. 

People walk past an empty retail space on Tverskaya street in central Moscow on March 16. 

Source: AFP/Getty Images

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Russia is facing the deepest economic contraction in nearly three decades as pressure from sanctions imposed by the U.S. and its allies mounts, according to an internal forecast by the Finance Ministry. 

Gross domestic product is likely to shrink as much as 12% this year, deeper than the 8% decline expected by the Economy Ministry, according to people familiar with the estimates who spoke on condition of anonymity to discuss internal deliberations. The government hasn’t released a public forecast since the invasion of Ukraine.