Russian Bank Director Sounds the Alarm: "Our Economy is Overheating"

Written by Henrik Rothen

Jun.08 - 2024 2:52 PM CET

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Photo: Shutterstock.com
Photo: Shutterstock.com
Although the Russian president speaks positively about the country's economy, the bank director does not agree.

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A somber warning has emerged from key figures in Russia’s economic sector: the country’s economy is overheating, and the consequences could be severe.

War-Fueled Economic Surge

For over two years, Russia's war in Ukraine has acted as a powerful stimulant to its economic engine.

Despite facing sanctions and export controls, the country’s GDP grew by 3.6 percent in 2023.

However, two years and four months into the conflict, signs are now pointing towards a potential economic meltdown. On Tuesday, the head of Russia’s largest bank raised a red flag.

"Our economy is definitely and significantly overheating," warned Herman Gref, CEO of Sberbank, according to Business Insider.

Russia has now reached a production capacity that, according to Gref, cannot be exceeded and is on the brink of collapse.

In December, Elvira Nabiullina, the head of the Russian Central Bank, also warned of the economic repercussions of Russia’s rapid growth.

"Imagine the economy as a car. If you try to drive faster than the engine allows, it will sooner or later break down, and then we won't get far," she said. "We may be driving fast, but only for a short period."

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