Sanctions and the removal of Russia from SWIFT have not deterred the Russian economy. A recent report by the International Monetary Fund (IMF) predicts that Russia’s economy will grow more in the next year than any other advanced economy.
The IMF believes Russia’s economy will grow by 3.2% in 2024, in comparison, the US is expected to grow by 2.7% while Europe’s top economy, Germany, is expected to grow by a mere 0.2%. Cutting off Europe from Russian energy backfired in a major way. Foreign investments have been pouring into Russia from the rest of the world, which is eager to join the rank of “advanced nation.”
Trade between China and Russia has spiked to $240 billion in the last year alone. World leaders have learned absolutely nothing from the previous three years. US President Joe Biden just announced new tariffs against China on steel, aluminum, and shipbuilding supplies that will be potentially raised to 7.5%, triple the current rate for steel and aluminum. “The president understands we must invest in American manufacturing, but we also have to protect those investments and those workers from unfair exports associated with China’s industrial overcapacity,” Lael Brainerd, director of the White House’s National Economic Council. The president of the US and other world leaders simply do not understand how the economy operates. Brainerd believes China is simply overproducing, and these tariffs will cause China to change its policy as it wishes to continue trade with the US, its previous top trading partner.
China does not need the US to excel at trade. China’s adopted capitalistic style of business is causing nations to line up to sell to China in the same manner that they once did to the US. Now, Americans are strapped for cash, and its consumer population is declining. Biden just made it less appealed for nations like China to sell to the US. Germany is failing to grow because it continued its mercantile system of business where it feels it must increase manufacturing. German manufacturing may be of higher quality than that of China but China’s middle class is growing, and with it, so are the number of consumers amid a population of nearly 1.4 billion people.
Russia does not need the US, Canada, or Europe for trade either, as they have a precious natural resource that is in higher demand than supply. The world needs energy and fossil fuels and cannot operate without them. As hard as the climate change zealots try, they cannot eliminate the world’s dependence on fossil fuels. Instead, the West is imposing regulations and taxing its people in an effort to reduce their reliance on fossil fuels, but the demand is not there, and the infrastructure does not exist. There is no reliable alternative to fossil fuels on a wide scale.
Russia does not need to adhere to the G7 nation’s price capping regulations. Russia has effectively been selling oil to nations like India who then turn around and sell it to the West at a premium. Pettiness is poor business, and simply attempting to ostracize a necessary trade partner from the global market has backfired in a major way. Now nations like those under BRICS are trading freely without Western interference and it is becoming overtly apparent that sanctions do not work.
Source: Armstrongeconomics.com
