Strained by the rising costs of its war on Ukraine, the Russian government said that it had a $47 billion budget deficit for 2022, the second-highest since the Soviet Union’s dissolution, the New York Times reports.
Russia’s revenues increased by 2.8 trillion rubles, or $40 billion, in 2022; however, $92 billion in new spending on defense and recovering imports pushed the budget deficit to 2.3% of GDP, the finance minister said during a government meeting.
While experts predicted a swift collapse of Russia’s economy under Western sanctions, the economy performed above expectations, buoyed by high commodity prices. Commodity prices are falling, though, and the EU price cap is pushing down the price paid for Russian crude oil to $25-30 dollars a barrel lower than Brent.
Moscow is partnering with Tehran to complete 3,300 kilometers of railways throughout Iran to provide an export channel to South Asia that can help it bypass sanctions.