Russia now a high-income country

Published 9 July 2024 at 17.13

Economics. Despite all the sanctions, Russia is now classified as a high-income country in the World Bank's latest report, reports Makronom.

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The World Bank annually, on July 1, updates its economic classification of the world's countries.

The countries are divided into four groups: low-income countries, lower-middle-income countries, upper-middle-income countries and high-income countries, based on gross national income (GNI).

This year's report shows that Russia's economic growth has increased significantly, which has lifted the country from an upper middle-income country to a high-income country. According to World Bank data, Russia has reached a GNI of $14,250, and the war economy has played a crucial role in this.

Despite the sanctions, Russia's economy, which has shifted to a war economy, has been strengthened by the military sector and increasing trade. According to the World Bank's analysis, trade has increased by 6.8 percent, the financial sector by 8.7 percent and the construction sector by 6.6 percent. These factors have resulted in real GDP growth of 3.6 percent, nominal GDP growth of 10.9 percent, and GDP per capita growth of 11.2 percent.

Ukraine has also climbed on the list, from lower-middle-income countries to upper-middle-income countries, thanks to Western aid that helped the country recover its economy. Ukraine's GDP grew by 5.3 percent, after falling by 28.8 percent the year before. GNI increased by 18.5 percent and the construction sector, driven by wartime reconstruction work, grew by 24.6 percent.

However, the World Bank also points to a tragic connection: Ukraine's GNI growth is strongly linked to the ongoing population decline, which has reached 15 percent since the outbreak of war.