The 2017 foreign trade trend in Russia suggests business inside the country is on the rise, according to Analytical Center experts. The increase in imports means business has adapted to the demand levels in various sectors of the economy at the current ruble exchange rate and a global oil price of about 50 US dollars a barrel. Foreign trade trends are the main topic of the new bulletin on the current trends in the Russian economy.
According to the data of the Federal Customs Service of Russia, Russia's foreign trade in January through July 2017 achieved $316.1 billion, increasing by 26.7% year-on-year. Exports increased by 26.1%, reaching $194.1 billion, while imports went up by 27.7%, reaching $122 billion. Imports have been on the rise for 13 consecutive months and in August imports were rising across the board: imports of engineering products increased by 20.7%, imports of chemical products increased by 23%, grocery imports increased by 20.9%, textile and footwear imports increased by 25.4%. In mid-2017 total imports exceeded the monthly imports seen in 2010, experts note.
At the same time, foreign trade in goods and services (according to the payments balance of the Bank of Russia, goods account for some 85% of Russian exports and 70% of imports while services account for 15% of exports and 30% of imports) plays an important role in the economic development and GDP growth in Russia, smoothing out both positive and negative fluctuations, the bulletin stresses.
The analysts believe that the economic downturn of 2014-2016 was especially hard because of contracting capital investments, the significant and long decline in global oil prices, the steep depreciation of the ruble and the external sanctions. The recession was made easier by the financial reserves Russia had accumulated, more effective crisis management in 2015-2017 thanks to the fact the government had already dealt with similar downturns in the past, as well as a boom in durable goods purchases in 2010-2014, the bulletin notes. "The decline in real household income and the deprecation of the ruble have caused consumer imports to fall and a decline in business activity led to a drop in equipment imports," the bulletin states.
The experts note that the increase in the prices of oil and metals between 2016 and 2017 increased the income from exports of goods with stable physical volume. Imports also increased across a broad range of items. In the past 3 years there has been a significant shift in Russian foreign trade from the EU and the CIS countries to the APEC, primarily as a result of increasing trade with China.
For more information see the bulletin Foreign Trade Trends.
For other bulletins on current trends in the Russian economy see Publications.