Since the outbreak of war, the IMF has allowed Russia to be in violation of its own membership standards–which require member states to disclose transparent, verifiable, and comprehensive national income statistics. Even Russian oligarchs such as aluminum tycoon Oleg Deripaska are openly fretting about how Putin will run out of cash next year–and how he’s been cannibalizing Russian companies to make ends meet! Yet the truth is, as they candidly admitted to us, the IMF Russia Desk economists have “basically zero visibility” into what is actually going on in the Russian economy. The IMF’s dubious methodology in tracking the Russian economy warrants close scrutiny. Nothing short of its institutional credibility is at risk, especially since the current IMF chief, Kristalina Georgieva, has been accused of pressuring economists to boost China’s business climate ratings during a previous tenure at the World Bank, which she denies.įor starters, the IMF’s forecast of economic growth in Russia exceeds even that of the Russian central bank, which expects GDP to fall by at least 1.5% this year. With respect to Russia, it is naively echoing Putin’s own invented GDP forecasts, in effect, canonizing and legitimating these economic myths with no verification–in fact, no independent analysis at all. Far from serving as the independent arbiter of the statistical underpinnings of global economic activity, the IMF has been asleep at the switch. Yet nothing could be further from the truth.
Following on the IMF’s latest assessment that the Russian economy shrank by a less-than-expected -2.2% in 2022, many of these commentators point to the IMF’s projection of fractionally positive economic growth in Russia of +0.3% in 2023, outstripping Germany and the U.K., as evidence that the economic pressure campaign against Russia has failed. The implications are equally disturbing–that unprecedented U.S.-led sanctions don’t work.
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