Russia’s third-quarter economy recorded barely any growth, primarily due to excessive military spending that has driven inflation and hindered economic expansion. The Central Bank of Russia reported that the economy grew by just 0.1% in the third quarter of 2024, which is significantly below the annual growth target of 2-3%.
Analysts attribute this stagnant growth to the immense financial burden of the war in Ukraine, which has diverted resources away from essential sectors such as manufacturing, agriculture, and technology. The military budget has swollen to nearly 10% of GDP, placing a heavy strain on the economy and contributing to inflationary pressures across the country.
Russian officials have acknowledged the challenges but remain focused on maintaining military readiness. The government has also sought to bolster the economy through state control of key industries and increased exports of energy and raw materials. However, the long-term impact of the war on the Russian economy remains a pressing concern for experts and policymakers.