IMF Forecasts Russia Economic Growth Slowing To 0.9% In 2025

The International Monetary Fund (IMF) has significantly downgraded its forecast for Russia's economy, projecting a slowdown to just 0.9% GDP growth in 2025 and a marginal 1.0% increase in 2026, marking the steepest revision among major economies. This deceleration follows two years of war-driven expansion and is attributed to tighter domestic economic policies and falling oil prices, with Brent crude expected to decline by nearly 14% in 2025. Russia's economic performance in early 2025 showed contractions in non-defense sectors, declining manufacturing activity, and weakening employment, raising concerns about the sustainability of its wartime boom. Meanwhile, Ukraine's real GDP is forecasted to grow modestly by 2.1% in 2025, rising to 3% by 2027, contingent on the war's trajectory and continued international financial aid, which is crucial as much of Ukraine's budget prioritizes defense spending. Kazakhstan's manufacturing sector faces challenges with output contracting for the second consecutive month in July 2025, despite ongoing growth in new orders, highlighting broader regional economic pressures. These forecasts underscore the divergent economic paths in Eastern Europe and Central Asia amid ongoing geopolitical tensions and conflict.