America's Russia Sanction strategy has completely failed
Russian President Vladimir Putin spoke out about the silver lining from years of U.S. imposed economic sanctions.
Speaking during a telethon with Russian citizens on Wednesday, Putin said: "We have not just adapted to the sanctions pressure. In some ways, they even did us good: replacing imported technologies with our own gave us an impetus to production. There are other positive things, such as the MIR payment system and the entire strengthening of the financial system."
The MIR card payment system is a Russian financial services system that became operational in 2014 after the Russian annexation of Crimea and subsequent sanctions against the country.
"And the fact that they frighten us or impose restrictions on the secondary market on our bonds and government loans -- well, there are plus sides to it. The total aggregate debt of the government and of the commercial sector has decreased. In general, this also has certain positive aspects."
That may sound like very small rewards for a lot of pain, but there is more easily measurable ways.
For instance, when it comes to replacing imported goods there has been tangible results.
The share of the oil and gas industry in Russia’s economy declined to 15 percent in 2020, down from 19.2 percent in 2019, according to a first such assessment published by the Russian statistics agency Rosstat.
Back in 2018, this share was even higher than in 2019, at 21.1 percent
Remember how critics of Russia like to portray it's economy as nothing but a gas station for the world? Well now the share of oil and gas in its economy is more in line with Canada's or Norway's.
The sanctions forced Russia's economy to adapt, and now it's economy is more diverse.
Speaking of gas, Nord Stream 2 will be finished in a few weeks, despite Washington throwing every sanction it could think of to stop it.
As for Russia's economy overall, Russia’s gross domestic product (GDP) rose 10.9% year-on-year in May, and is expected to grow about 4% for the rest of the year. Plus the government is expected to run a surplus, which will allow it to spend on infrastructure, education and health.
Finally, it's strong credit outlook cannot be denied.
Russia's 'BBB' IDRs reflect its credible macroeconomic policy framework, strong external balance sheet (including a large net external creditor position, and highest external liquidity ratio in the 'BBB' category), and the lowest level of general government debt/GDP in the peer group.
It's long past time Washington gave up on "isolating" Russia and demonizing Russia, and started talking to Russia. Because this isn't working.