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  • In the coming months, Russia is expected to issue commemorative banknotes, celebrating

  • the 2014 invasion and annexation of Crimea. This controversial move is, by some, thought

  • to be an intentional distraction from Russia’s deep economic recession. The annexation of

  • Crimea, along with military action in Syria, has much of the Western world turning its

  • back on Russia. So we wanted to know, Is President Putin causing Russia’s economic recession?

  • Well, economic reports from late 2015 have shown that Russia’s economy has consistently

  • shrunk over the past three quarters. This current period is seeing a 4% drop compared

  • to last year’s figures. And earlier in the year, Russia saw its largest economic downturn

  • since the 2009 financial crisis. Despite being the 10th largest GDP in the world, Russia

  • has seen half the value of their currency disappear since mid-2014. Although the rapid

  • decline has since begun to show signs of stability, Russia has a long way to go before restoring

  • their economic might. But what is actually causing this deep recession?

  • Well, the international response to President Vladimir Putin’s territorial aggressions

  • was far from favorable. The US, UN, and EU saw the annexation of Crimea as an illegal

  • encroachment on Ukraine’s sovereignty, and imposed a series of sanctions on Russian trade,

  • business, and individuals. Among other industries, those sanctions targeted nationalized oil

  • companies, which constitute an enormous portion of the Russian economy. In response, Putin

  • imposed his own sanctions, preventing Western food from entering the country. Russia even

  • destroyed tons of cheese, fruit, bacon and other foods, instead of allowing them to go

  • to the country’s many impoverished residents.

  • But while Russia may have been able to avoid significant downturn dealing with sanctions

  • alone, geopolitical events have crippled their oil revenues even further. Over the past two

  • years, the US and Saudi Arabia have been competing for oil supremacy. In an attempt to prevent

  • the US from making a new form of drilling profitable, Saudi Arabia has been selling

  • its vast reserves for around $50 dollars a barrel. That’s down from about $100 dollars

  • a barrel in June 2014. Meanwhile, Russia is the largest producer of crude oil on earth,

  • and the second largest producer of dry natural gas. In 2013, Russia saw 68% of its export

  • economy dependent on oil.

  • Obviously, economic sanctions, coupled with a dramatic collapse in oil prices, has left

  • Russia with nowhere else to turn. This is further coupled with the fact that both militarily

  • and economically, Russia is unable to compete with the United States in the long run. In

  • the end, it seems that Vladimir Putin’s obstinance in the face of economic downturn

  • may just further Russia’s slow economic decline.

  • Another reason Russia might be in economic decline might be the country’s high level

  • of corruption, which benefits the elite but punishes the less wealthy. Find out more in

  • our video. Thanks for checking out our channel! Make sure to like and subscribe to TestTube

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In the coming months, Russia is expected to issue commemorative banknotes, celebrating

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