Russia

RUSSIA (Russia is forecast to see negative GDP growth in the 2nd Q of 2022) 

The USA, European Union, UK, Canada, Japan, South Korea, and Australia have leveled tough sanctions/penalties on Russia with possibly more to come as a result of their hostilities against Ukraine. Russia will have to deal with the severe sanctions that could cripple its economy and construction sector.

The Russian economy, before the commencement of hostilities in Ukraine, was slightly smaller in economic terms than Italy. Look for the Russian economy and construction sector to contract by at least 10% to 20% in 2022, with price hikes, high inflation, and rising unemployment appearing to be in the cards within the next 3 months.

Russia and Ukraine are both large exporters of some specialty metals/minerals, such as palladium, titanium, and manganese/nickel, which most probably will cause shortages and price increases. Ukraine is also a large exporter of wheat (it supplies 35% of the world’s output). This is another issue to deal with.

Needless to say, 2022 will be a challenging year for the Russian l construction sector. The effect of the ongoing war with Ukraine has yet to be fully understood.

Russia is currently experiencing high inflation rates, between 8% and 14%. This could lead to higher construction costs or projects getting canceled in 2022.

Oil prices have increased by more than 35% in the last 3 months. This is somewhat good news for the Russian economy and construction sectors if Russia can sell its oil/gas products. 

The Russian economy and construction sector will be severely impacted by the ongoing war in Ukraine. It is difficult to forecast the long-term impact on the Russian economy and construction sector.