In Russia, social inequality will increase significantly in the coming years. The middle class is shrinking, and the number of the poor will skyrocket.
About it writes the edition Reuters. A 2022 study by Russian experts on economic institutions, business, and civil society says that only a combination of global economic growth and an easing of sanctions on Russia can improve real incomes and reduce poverty.
The middle class will suffer in any case, even if the sanctions pressure is lowered, the study says. Russia’s economy has proved surprisingly resilient to last year’s harsh Western sanctions, but a return to pre-war levels of prosperity may be a long way off as more government spending is channeled into the military.
The study’s most optimistic scenario assumes that real incomes will exceed 2021 levels by about 2% in 2030, and poverty will fall below 10% from 11.8% in 2022. In this scenario, the size of the middle class will still fall to 14-31% by 2030 from current estimates of 20-50%.
Worsening scenarios eventually lead to lower real incomes by 2030, with poverty approaching 20%. “On the one hand, there will be an increase in the concentration of wealth and a subsequent separation at the “top”, and on the other hand, a reduction in unevenness at the bottom due to the convergence of the middle (or earlier than the middle) strata with the poor,” the authors say.
As GLOBAL HAPPENINGS wrote earlier, in Russia, due to the high deficit, the Welfare Fund may end this summer. Opportunities to cover the budget hole are shrinking.
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