Putin announces Russia's economy grew by just 1% in 2025
President Vladimir Putin announced on Tuesday that Russia's economy grew by 1% in 2025, a significant slowdown compared to the 2024 growth, as it struggles under the ongoing strain of the Ukraine war.
Huge spending on its army fighting in Ukraine has initially spurred growth and helped Moscow buck predictions of economic collapse after it launched its offensive in 2022, News.Az reports, citing foreign media.
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But the ramped-up spending pushed up inflation, weighing on real growth, while businesses have railed against high borrowing costs introduced to rein in the rise in prices.
“Russia’s GDP grew by one percent last year. This is lower than the dynamics observed earlier, as we are well aware: in 2023 and 2024, growth was 4.1 percent and 4.3 percent, respectively,” Putin told a government meeting.
“But we also know that this slowdown was not simply expected, one could even say it was man-made: it was connected with targeted measures to reduce inflation,” Putin added.
He said the inflation “had been reduced to 5.6 percent” last year, compared to 9.5 percent a year prior.
In December, Russia’s central bank cut its benchmark interest rate to 16 percent as inflation showed signs of slowing down.
By Ulviyya Salmanli
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