The Economic System

Russia’s economy has a huge gap between the wealthy and the poor. The economy is a upper-middle income transition economy. It is estimated that the wealth held offshore by rich Russians is three times more than official net foreign reserves. Russia’s economy consists mainly on oil, natural gas, precious metals, and their arms industry. This means the economy relies heavily on oil prices. Because of the drop in oil prices from 2014-2016, Russia has been suffering losses. The drop had the lowest price of 51$ (TRT world) in the last decade. However the country’s estimated budget for 2018-2019 has changed from $8.5 Billion to $44.4 Billion.