Russia – A New Country With a Rich History

A New Country With a Rich History

According to IMF and World Bank reports, Russia’s $1.5 trillion economy is ranked sixth in the world. Russia has 9 time zones and with 142 million citizens is the world’s ninth largest populace. Putting this in perspective; it has twice the population of the UK or is equal to the populations of the Czech Republic, Denmark, Hungary, Ireland, Italy, Malaysia, Portugal and Switzerland combined.

However, numbers are not everything and size does not matter.

Modern Russia is a new country, with a rich and diverse history, created by the radical political action that destroyed the Soviet Union; a superpower state of 286 million people. On December 8th 1991 the heads of State of Belarus, Russia and Ukraine (Stanislav Shushkevich, Boris Yeltsin and Leonid Kravchuk) abolished the 74-year-old Soviet Union despite the ballot 9 months previously when Soviet citizens’ voted for its preservation.

The dissolution of the Soviet Union led to the reformation of Russia as an independent nation and ushered in the Yeltsin era: the 1993 constitutional crisis and the 1998 financial crisis; the resultant mass deprivation, the disintegration in manufacturing and a consequential collective trauma that is the influence behind Russian life today.

Russians fronted more than the collapse of their political system, young men died en masse as the country saw a 40 percent surge in deaths between 1990 and 1994. Before 1990 the Soviet Union’s population grew 2 million per year, a trend from 1948. After 1990 the Russian population shrank by over 1 million per year. Premature deaths in this period were greater than those suffered by the Russian Empire in World War 1.

Putting party politics to one side, political stability and a new country began post-Yeltsin in December 1999 when Putin became President, following the resignation of Yeltsin. Then Russia restored its’ territorial integrity (following a successful conclusion of the Second Chechen War) and its’ GDP grew 72% between 1999 and 2008. Muscular macroeconomic management, focal fiscal policy reforms, high oil prices; investment in capital schemes combined with low-cost finance, all assisted the growth, and a return to normalcy for the bruised and battered citizens.

One could argue that the Russia we trade with now is 12 years old and a new country. The nation endured a forced conversion from a controlled economy to a capitalist society via nihilism between 1990 and 2000. Russia lost a decade and millions of citizens.

Both the Russian government and business sector are a result of the rapid changes rather than a cause. Symbolically, Russia was the last member of the Group of 20 to join the WTO in a ceremony in Switzerland, on Friday 16th December 2011.

In 2010 the nation states of Belarus, Kazakhstan russia Ukraine war and Russia formed a Customs Union to develop mutual trade and relations. The formation has seen the closure of customs facilities at historical border posts between the three nations and a strengthening of resources at the new external borders. Border controls between Russia and Belarus closed in July 2010 and between Kazakhstan and Russia in July 2011. Uniform customs codes came into force between the 3 countries on 1st January 2010. The three were, as Soviet Republics, the last to declare independence from the Soviet Union in 1991.

I have a great interest in Russia and enjoy sharing 25 years in business, 10 spent in Russia.

 

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