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Russia faces economic upheaval, two years to return to inflation target - Nabiullina

18 April 2022 13:45 (UTC +04:00)

Russia's economy cannot survive indefinitely on its financial reserves and will have to transform itself to deal with the impact of international sanctions, Central Bank Governor Elvira Nabiullina said on Monday, APA reports citing Reuters.

In her most significant speech since Russia sent its forces into Ukraine on Feb. 24, Nabiullina said it would take until 2024 to bring inflation back to its 4% target.

"The period when the economy can live on reserves is finite. And already in the second and third quarter, we will enter a period of structural transformation and the search for new business models," she said.

Sanctions had mainly affected the financial market, "but now they will begin to increasingly affect the economy," she said.

"The main problems will be associated with restrictions on imports and logistics of foreign trade, and in the future with restrictions on exports."

She said Russian companies would need to adapt.

"Russian manufacturers will need to search for new partners, logistics, or switch to the production of products of previous generations," she said.

Exporters would need to look for new partners and logistical arrangements and "all this will take time", said Nabiullina.

She outlined several measures to help the economy adapt.