Russia to cure Dutch disease by 2024: a myth or reality

Abstract

The dominance of the oil and gas sector can be identified as the major peculiarity of the Russian economy. In 2019, before the COVID-19 hit, the share of the oil and gas sector in the GDP of Russia was 19.2 %. In 2020, this indicator was 15.2 % Currently, the Russian Federation still struggles with the Dutch disease since the global oil prices have a substantial impact on the key economic indicators of the country. Taking into account the recent recession in the global oil sector related to COVID-19, the examination of the Dutch disease in Russia is of special importance. The article examines whether it will be possible to get rid of this disease by 2024. The necessary information for the study has been taken from the website Federal State Statistics Service, sources of the Central Bank of the Russian Federation, the Ministry of Finance of the Russian Federation, and the Accounts Chamber as well as academic articles. According to the estimations of the Ministry of Finance of the Russian Federation and the Central Bank of the Russian Federation, in 2024, there will be certain differences when compared to 2021, such as a decrease in oil prices and a decrease in the GDP percentage of oil and gas revenues. However, these changes will not be significant enough to be able to prognosticate that Russia will cure Dutch disease by 2024. Thus, the article argues that the Dutch disease will be still present in Russian in 2024.