Category World News

Russia’s economy must not slide into recession, President Vladimir Putin said, after economists warned for months of a slowdown in growth.

Putin told attendees, including government ministers and central bankers, at the St Petersburg International Economic Forum on Friday that some specialists and experts were “pointing to the risks of stagnation and even a recession”.

“This must not be allowed to happen under any circumstances”, he said.

“We need to pursue a competent, well-thought-out budgetary, tax and monetary policy”, he added.

Economy Minister Maxim Reshetnikov said on Thursday that the economy was on the verge of slipping into a recession, and monetary policy decisions would determine whether it falls into one or not.

In October, the Bank of Russia increased its key interest rate to the highest level since the early 2000s to curb high inflation, only to cut it by one percentage point to 20 percent earlier this month.

Moreover, economists warned for months of a slowdown in the economy, with the country posting its slowest quarterly expansion in two years during the first quarter of 2025.

However, the Kremlin said it expected the slowdown due to two years of rapid expansion as it increased military expenditure to fund its war against Ukraine.

Yet, Putin denied that the defence industry was solely driving the economy. “Yes, of course, the defence industry played its part in this regard, but so did the financial and IT industries”, he said.

He added that the economy needed “balanced growth”, calling on officials to keep a “close eye on all indicators of the health of our industries, companies and even individual enterprises”.

At the same time, Deputy Prime Minister Alexander Novak said on Friday that it was time to “cut the]interest] rate and start heating up the economy”.

German Gref, CEO of Russia’s largest lender Sberbank SBER. MM also called for faster rate cuts to incentivise companies to invest.

Growth of military industries

Putin has used the annual economic forum to highlight Russia’s economic prowess and encourage foreign investment, but Western executives shunned it since Moscow sent troops into Ukraine in 2022, leaving it to business leaders from Asia, Africa and Latin America.

The economy, hit with a slew of Western sanctions, has so far outperformed predictions. High defence spending has propelled growth and kept unemployment low despite fuelling inflation.

Large recruiting bonuses for military enlistees and death benefits for those killed in Ukraine have also put more income into the country’s poorer regions. But over the long term, inflation and a lack of foreign investments pose threats to the economy.

Economists have warned about the economy’s continuing downward pressure and the possibility that it will stagnate as a result of inadequate investment in other than the military.

Putin claimed that the expansion of military-related industries contributed to the development of modern technologies for the military.

He vowed to keep up the modernization of the military, drawing inspiration from the experiences of the conflict in Ukraine.

He declared, “We will use modern military infrastructure facilities, modernize the Russian armed forces’ combat capabilities, and equip them with the most modern technology, weapons, and equipment,” and use of new technology.

In an effort to put an end to the current Iran-Israel conflict, European diplomats are scheduled to meet with Iran’s foreign minister on Friday in Geneva. Milena Veselinovic from Al Jazeera examines the outcomes anticipated from the discussions.

The head of the UN atomic watchdog, Rafael Grossi, told the Security Council that an Israeli strike on Iran’s Bushehr nuclear plant would cause a nuclear disaster. The Israeli military had said on Thursday that it had struck the facility, but later clarified that the comment had been made in error.

Tehran, Iran – Suitcases are passing through the city of Tehran this time, but not this time for family gatherings or holidays. They are being packed quickly out of fear, as evidence of the rising concern that the 10 million Iranians are feeling as they are facing Israeli missiles.

Dual Iranian-American nationals are caught in the crossfire of war and geopolitical uncertainty, just as Iranians search for shelter.

Amir, a dual-national and 36-year-old Tesla engineer, flew to Tehran from the United States just as Israeli airstrikes began to strike targets all over Iran. On Mount Damavand, which is located about 60 kilometers northeast of the capital, he had been spending time with his family and had been spending quiet days with them. Israel launched its attacks a few days before his scheduled return flight to the US, even though his return flight was already booked.

Amir was ensnared by fear when the bombs started falling, not just fear of war but also fear of being drafted and falling victim to politics beyond his control.

“I didn’t first feel scared,” she said. Amir, who opted not to use his last name for security reasons, said that being with my family helped me find peace. He recalled that while watching from afar in the US, he had been more concerned for his family’s safety during the anti-government protests in Iran in 2022. I was constantly worried, glued to the news, and concerned for my family when I was younger. However, he said, “I could see that life was still going on” because he was in Tehran and Damavand.

But he soon realized Iran’s continued existence was too risky. Amir, a US citizen, feared that Iranians who have permanent residency would also be affected by President Donald Trump’s growing possibility of reimposing a travel ban. Amir made the decision to leave with an air of urgency.

leaving loved ones behind, crossing borders

Amir began a lengthy overland journey in fear for his future and his life. He took an 11-hour bus ride from Urmia, western Iran, to the city of Urmia on Monday. After that, he traveled by road to Van, in eastern Turkiye, for another six hours. He then boarded a domestic flight to Ankara, where he made his Thursday US flight.

For Amir, fleeing was more than just a logistical and emotional traumatic experience. I would have stayed close to my loved ones, he said, “If it weren’t for the fear of being conscripted and the possibility of a new Trump-era travel ban.” In the US, “it’s harder.”

A 41-year-old postdoctoral researcher with a San Francisco base had to make a similar choice. One of Israel’s longest-range missile attacks struck Mashhad, which he was visiting while there.

He recalled that he made an effort to remain calm for the first two days. “But then, I had to confront the reality that this conflict is unlike anything I’ve seen in the past. The sky won’t be clear or open, at least for the upcoming months.

Behrouz would typically end his trips to Iran by taking his colleagues back home in the US for a walk through the Imam Reza Holy Shrine’s courtyard to pick up sweets and saffron. However, he flew in a rush this time. The journey was exhausting, taking 10 hours by car from Tehran to Urmia, then crossing the Razi border into Turkiye. He claimed that the checkpoint was “about 20 minutes long,” but the lengthy 22-hour bus ride to Istanbul followed.

Behrouz stated that his job forced him to resign. He said, “But my heart is still with my family, and with the people,” his voice piercing.

He continued, “We oppose both the Iranian regime and Israel.” “We are millions of ordinary Iranians who are entangled in political decisions that aren’t our own.”

Behrouz’s words echoe many others’ quiet apprehensions. According to reports from the US embassy in Azerbaijan, about 600 Iranian-American dual nationals with support crossed into southern Azerbaijan from northwestern Iran via the Astara border. Iranian-American Facebook groups were thriving online for traveling coordination. One user inquired, “My flight was scheduled for late June. Should I attempt to leave Turkiye or Armenia? Bring additional fuel, another advice. Purchases are restricted to 10 liters per car at gas stations. Some even bundled up resources to rent a van to cross the Turkish border.

The logistics are complicated for those who are able to leave, but they frequently fare less than the emotional strain.

Getting cut off and staying behind

Not everyone leaves, though. Before the war broke out, Afsaneh, a 43-year-old mother who lives in northern California, flew to Iran with her daughter, who is seven years old. She stated on Instagram that she had no intention of returning despite US State Department warnings that citizens should leave.

In a recent post, she stated, “This is where I want to be.” “With my family at this time.”

Others have had to watch from a distance as their loved ones endure the strikes.

Just two weeks before the airstrikes began, Iranian-Canadian woman, 38, who lives in Toronto, had sent her parents and sister to Iran. Bombs went off in Tabriz, a city in the northwestern of Mexico, shortly before their habitation.

Mortazavi said, “I was on a blurry video call with them, hearing explosions and air defense systems.” Her family escaped to safety in Urmia, which is close by. The Iranian government had suspended internet access by Wednesday afternoon. Mary and them lost all communication.

She broke down and said, “I can’t even get out of bed. I’m worried.” I just hope they can reach me using a functioning VPN.