Russia Overtakes Japan and Germany

The Russian economy has overtaken Japan to become the fourth largest in the world in PPP terms (purchase power parity), according to revised data from the World Bank released at the start of June 2024.

 

As bne IntelliNews reported in August, Russia had already overtaken Germany to become the fifth biggest economy in adjusted terms. Hit by multiple shocks recently and cut off from cheap Russian gas, Germany is now stagnating and has fallen to sixth place in the World Bank’s ranking. 

 

PPP GDP measurement is preferred by many economists, as it takes into account the difference between local prices and nominal prices, similar to The Economist’s famous Big Mac index: a burger in Moscow costs about half as much as the same burger in New York. 

 

In fact, the World Bank have already improved Russia’s ranking after revising their data and attest that Russia actually got past Japan in 2021 and has maintained its position at number four since then. Their previous calculations were based on 2017 data but these have now been updated to reflect the 2021 figures.

 

Economists estimate that Russia’s growth potential has increased from 1-1.5% pre-SMO to around 3.5% now. Last year, Russia’s economic growth caught analysts off guard with a 3.6% expansion. This year the World Bank have resolutely almost trebled their forecast for growth from 1.1% to 3.2%. Russia’s Economic Ministry are similarly bullish.

 

Well done, Russia!

 

China’s Chang’e-6 lunar module returned to Earth Tuesday, successfully completing its historic mission to collect the first ever samples from the far side of the moon in a major step forward for the country’s ambitious space program. 

 

Well done, China!