Large investments in the military have initially spurred growth in Russia, contrary to predictions of economic collapse following the invasion of Ukraine in 2022.
But the increased spending has helped drive up inflation, dragging down growth, while companies struggle with high borrowing costs imposed to curb price increases.
Russia's GDP grew by one percent last year. In 2023 and 2024, growth was 4.1 percent and 4.3 percent, respectively, Putin said at a government meeting.
But we also know that the slowdown is not just expected; one could even say that it was man-made, linked to targeted measures to reduce inflation, Putin added.
