World Bank upgrades BRICS’ Russia to high-income status

Russia’s economy has defied the odds. Despite sanctions following the invasion of Ukraine in February 2022, the World Bank has upgraded Russia to “high-income country” status. The upgrade from upper-middle-income comes from various factors.

“Economic activity in Russia was influenced by a large increase in military-related activity in 2023.”

World Bank

This surge was accompanied by a rebound in trade (+6.8%), growth in the financial sector (+8.7%), and a rise in construction (+6.6%).

The increases in real GDP (3.6%) and nominal GDP (10.9%) are notable. Additionally, Russia’s Atlas Gross National Income (GNI) per capita grew by 11.2%.

Ukraine, meanwhile, has experienced both economic recovery and demographic decline. After a severe drop of 28.8% in real GDP in 2022, Ukraine saw a 5.3% growth in 2023.

Source: World Bank

This recovery is primarily driven by construction activity, which grew by 24.6%. Investment spending has also surged by 52.9%, aiding in Ukraine’s reconstruction efforts despite ongoing conflict.

However, Ukraine’s population has declined by more than 15% since the Russian invasion began. This has further influenced economic indicators, leading to an 18.5% increase in nominal Atlas GNI per capita.

BRICS, SCO, and the new world order

The Shanghai Cooperation Organization (SCO), along with the BRICS boys, have been busy shaping a new multipolar world order. They want to yank the US dollar off its throne. Russian president Vlad Putin recently commented on the matter, saying:

“Engagement with multilateral institutions seeks to shift the international system away from a U.S.-dominated unipolar order.”

Putin thinks this shift “irreversible” and warns against global domination by any single country or group. Meanwhile, China’s boy Xi Jinping has expressed China’s readiness to embrace change.

President Xi Jinping and President Vladimir Putin. Credits: Getty Images

He says he is committed to creating new opportunities. Xi also shared that he supports Kazakhstan in joining the BRICS.

“In the face of unprecedented, epochal and historical changes, the Chinese side is ready, together with the Kazakh side, to create new opportunities in times of crisis and open up new prospects.”

– Xi Jinping

BRICS is all about expansion at the moment. Argentina had planned to join last year. However, President Javier Milei withdrew the country’s application shortly after taking office in December.

Reporting by Jai Hamid