Russia’s most significant economic problem is that its exports little other than energy, but for the average citizen, there has been no “trickle down.” That means Russia cannot develop anything like the massive rise of a middle class, which has been a hallmark of the Chinese economy, or the long-standing heart of the nations that have been considered “developed” for years.
Russian ranks 10th in nominal GDP based on International Monetary Fund data, which puts is behind Italy. Based on GDP per capita on the same basis, it is 53th at $12,993, behind Lithuania and Poland. Even if the energy economy makes further gains, plans to create a middle class are doomed, if there are any such plans at all.
Russia has failed at two things, each of which is dependent on the other. Russia exports little beyond energy, which means access to good jobs is largely limited to that sector. Without a broader array of successful industries that can build employment with good wages, the central government continues to support a very rich upper class and a mammoth poor one.
Russia has little chance at the kind of GDP growth that are measures of success in nations like China and Brazil, because a large population that is a foundation of GDP growth from inside the country does not exist.
Where do these things leave Russia? With a government that appears unwilling to support the economic health of its people. And that places Russia at a distinct disadvantage. By many yardsticks it cannot be considered a developing nation, and it is almost on the list of third world countries.
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