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Russia country report

A trading report from leading trade credit insurer Atradius ( reveals Russia is forecast to see a modest rebound in economic growth this year after the combination of low oil prices and the negative effect of lockdown measures on domestic demand in 2020.  

In its ‘Russia Country Report’ (, Atradius economists expect a modest rebound in 2021, forecasting GDP growth of 1.9%.  Exports are forecast to increase by around 3% in 2021, following a 4.8% contraction last year.  While the recovery in the per-barrel oil price will support the rebound, Atradius warns that a comprehensive recovery of domestic demand is impacted by the expected roll back of government fiscal stimulus.  Decreasing social benefits and other subsidies to households could dampen the rebound of private consumption, which deteriorated by 6.5% in 2020.
Looking forward, Atradius forecasts the medium-term prospect for higher and sustainable growth rates remains subdued.  The report highlights that international sanctions will depress foreign direct investment inflows while growth will be weighed down by structural weaknesses such as a shrinking workforce, dependency on natural resource sectors, institutional weaknesses, poor productivity growth and a difficult business environment.  Risks to the future outlook also include the uncertain long-term path of the pandemic and slow rollout of vaccinations in Russia to date.

“Prior to the pandemic, the UK had a growing relationship with Russia which the ONS reports amounted to £5.3 billion in annual exports,” comments Richard Reynolds, Head of Strategic Accounts at Atradius UK.  “While there are challenges to trading in Russia, there remain opportunities for companies that are attuned to mitigating risk and have the patience to develop long-term relationships.  Risk awareness is critical to businesses in order to limit the potential impact of non-payment and to future proof amidst an uncertain and unprecedented trading environment.”

Atradius’ analysis of key industries in Russia reveal the financial services, food, metals, paper and steel sectors have the strongest outlook, ranked as ‘fair’, with an average credit risk and stable business performance.  The agriculture, chemicals/pharma, construction, consumer durables, electronics/ICT, oil/gas and services sectors are ranked as ‘poor’, with a relatively high credit risk and business performance below the long-term trend.  Finally, the machines/engineering and textiles sectors have a ‘bleak’ outlook, with a poor credit risk and weak business performance.

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