The evident strain on Russia's economy

Forecast: «Outlines of the Global Future» (Published February 9, 2026, link)

S. Dragun:

Early March 2026 ... the evident strain on the economy, particularly in the construction sector. Something will need to be rebuilt from scratch. This is likely to involve new plans for restorative spending due to the war. This will also put additional pressure on the Russian economy...

«Early March 2026 shows evident strain on the economy».

Russian President V. Putin, commenting on the statistical data formed since the beginning of the current year, emphasized that currently the country is experiencing a negative trend in key macroeconomic indicators. Thus, Russia's Gross Domestic Product (GDP) in this period was 2.1% lower than in the same period in 2025, while extractive industries, despite a 0.8% decrease in industrial production, grew by 0.5%.

Central Bank of the Russian Federation (CBR) Governor Elvira Nabiyullina stated on March 20 that the situation in the Middle East significantly impacts not only the dynamics of global commodity markets but also the final effect on the Russian economy. The latter, she said, will depend on the duration and scale of these geopolitical events. According to Nabiyullina's assessment, the ongoing events may slow down global demand and investment growth, increase inflationary pressures in countries importing energy resources, and lead to supply chain disruptions.

Budget constraints, declining profitability of enterprises, economic and investment slowdowns are challenges for Russia's economy to achieve long-term growth trajectories, said Russian Minister of Economic Development Maxim Reshetnikov on March 18, 2026.

Speaking at the ministry's final meeting, Reshetnikov noted that the main task is to ensure the economy's exit onto a trajectory of long-term growth.

"The task is to resolve it under conditions of uncertainty and challenges. External challenges include escalating sanctions, trade wars, and geopolitical conflicts. Internal challenges encompass budget constraints, intensified competition, including with imports in the domestic market, declining business profitability, economic and investment slowdown." said Reshetnikov.

The complexity of the economic situation is also confirmed in the regions.

The CEO of PAO 'Magnitogorsk Metallurgical Combine' Pavel Shilyayev noted that in 2025, the combine operated with a loading rate of 70-80% and minimal profitability, with the group's net loss reaching nearly 15 billion rubles. This year, loading has dropped to 60%, and there is no forecast of a revival in demand for metal products.

Under these conditions, the management of the plant made the decision to withdraw unused production units from operation.

In early March, the Chertinskaya-Koksovaya mine ("MMK-Coal"), part of the "MMK-Metiz" capacities, and the Lyssven Metallurgical Plant introduced a reduced working time regime.

Under these conditions, "... something will have to be built from scratch."

In the case of MMK, "10% of managers will be cut, and unused units will be withdrawn from operation."

"The beginning of March 2026 shows the obviousness of significant tension ... especially in the construction sector."

According to experts, developers are losing pace: who has the most construction delays.

In March 2026, several major developers encountered an increase in the share of delayed projects. At the same time, some companies managed to significantly improve their performance and leave the anti-rating. Who ended up among the leaders in delays, and who managed to reduce the number of problematic objects - in a fresh review.

In March 2026, the balance between disciplined and problem-plagued developers in the new construction market changed significantly. According to restate.ru's assessment, several major players increased their share of overdue projects, while some companies managed to improve their positions considerably.

The leader in terms of delays is «Samolyet»: nearly half of its under construction houses, 48.1% or 130 out of 270, are not being completed on time. LSR follows with 47.5% of its projects delayed (38 out of 80). These two companies have topped the anti-rating for the first time in a long while, overtaking other major developers.

The top five developers with the highest share of problematic projects also include «Tочно» (30.7% - 51 out of 166), MR Group (29.6% - 8 out of 27), and PIK (18.9% - 34 out of 180). For MR Group, this is its first appearance on the anti-leader list, as it immediately secured fourth place. PIK's share of delays increased from 16.3% to 18.9% over the month, and the number of problem houses rose from 29 to 34.

The situation with delays in the housing market remains tense. Almost half of the largest developers have a significant portion of their projects exceeding stated deadlines. The rating dynamics shows that discipline and agile portfolio management allow certain companies to quickly change positions and exit the risk group.

An analysis by restate.ru indicates that competition among developers is intensifying not only through new projects but also through the battle for reputation and buyer trust. In the coming months, new reshuffles in the ranking can be expected if companies continue to change their approaches to construction management.

The beginning of 2026 was a failure for the construction industry: companies have orders for less than a month ahead. The industry was hit by abnormal frosts and a general decline in business activity, particularly in residential and road construction. The current situation is also negatively affecting the financial results of contractors.

Given the complex situation in the country this March, decisions are being made at the state level, as “based on this (tension in the economy) ... something really needs to be rebuilt.”

“It is necessary to return to the trajectory of sustainable economic growth. Of course, with a slowdown in inflation and maintaining stability in the labor market”, - Russian President Vladimir Putin stated on March 23.

According to the Russian President, the balance of the domestic macroeconomic structure is an important condition for economic growth. He also attributed factors influencing this to constant monitoring and management of money supply growth, credit dynamics, and the state of the budget system. Putin emphasized that those present need to ensure long-term sustainability.

"Of course, for effective macroeconomic policy, it is important to consider all significant factors and respond proactively to external risks. Such risks are currently acutely manifest in global markets within the system of international economic relations," he added.

As predicted by S. Dragan, "... there are likely to be... new plans for expenditure of a restorative nature as a result of the war."

At the end of March, during a closed meeting with President Vladimir Putin, representatives of major Russian businesses discussed the regulation of artificial intelligence (AI), the protection of entrepreneurs' rights, as well as issues related to platform economics, Alexander Shohin, President of the Russian Union of Industrialists and Entrepreneurs (RSPP), told journalists.

The meeting with members of the union's board and entrepreneurs in a closed session was held by the head of state after the plenary session of the RSPP congress. It lasted for about two hours. According to Shokhin, in addition to the aforementioned topics, Putin and business representatives discussed the need for a 'mirror response mechanism' to sanctions. This involved protecting the interests of Russian companies whose rights were violated in hostile countries, he said.

"He, as a lawyer, explained to us the difference between public international law and private law and how to work on it," Shokhin added.

Another topic traditionally discussed by Putin and business was geopolitics, including the situations in Ukraine and the Middle East, continued the RSPP head. Putin expressed hope that the Middle East conflict would be resolved in the next three to four weeks, but made it clear that the windfall profits obtained under crisis conditions "won't last long."

After the start of the US-Iran conflict and the blockade of the Strait of Hormuz, energy resource prices worldwide have risen. Due to the escalation of geopolitical tensions in the Middle East, the price of Brent oil reached $120 per barrel at one point, marking a high not seen since June 2022. However, oil prices later corrected: on March 26, June Brent crude futures traded at $106 per barrel.

Following the meeting, Shohin also commented on a statement by Minister of Economic Development Maxim Reshetnikov, who said in the State Duma that his department is open to dialogue on introducing a tax on superprofits in certain sectors. According to the head of the Russian Union of Industrialists and Entrepreneurs, such discussions could be relevant if the ruble weakens significantly and exporters gain additional currency profits.

"If the ruble falls, superprofits will emerge, [taxation] which, modeled after the old windfall tax, can at least be discussed. If the ruble drops to 100, well, there's something for exporters to discuss," he noted.

According to businessman Oleg Deripaska, the meeting also discussed the pace of economic recovery. "The president paid a lot of attention to this issue - what restrictions, what problems, what prospects, taking into account the changed situation in the global markets. The key question is how quickly, even taking into account these anti-inflation programs of the Central Bank, to try to restore economic growth rates," he said at the sidelines of the RSPP congress.

The 35th Russian Union of Industrialists and Entrepreneurs congress saw President Putin regularly engaging in dialogue with business representatives. The closed format of the meeting allows for the discussion of the most relevant and pressing issues, explained President's press secretary Dmitry Peskov.

«Something will have to be rebuilt from scratch. Probably, this is new plans for recovery-related expenses as a result of the war.

One of the participants in Vladimir Putin's closed meeting with business people said, "For the state, he considers it necessary to allocate a certain large, very large sum of money - and this was his family decision," said D. Peskov at a briefing.

Mash in MAX, citing a source present at the closed session, reports: "At the meeting of Russian President Vladimir Putin with business leaders at the RSPP Congress, entrepreneurs announced the allocation of 430 billion rubles for the development of the Russian economy. The initiative was taken by businessman Suleiman Kerimov."

According to the channel's source, the businessman responded to the president's outlined plans for the country's development over the next 30 years. Kerimov stated his readiness to allocate 100 billion rubles, arguing that once the state supported business, now business supports the state. The idea was immediately picked up by entrepreneur Oleg Deripaska, who also promised 100 billion.

After the official part, Norilsk Nickel's President Vladimir Potanin joined the initiative, stating 100 billion, then adding another 30. In response, Kerimov doubled his contribution to 200 billion. Thus, the total amount allocated by the three businessmen for the country's economic development reached 430 billion rubles.

S. Dragen predicts that:

... the additional burden on the Russian economy ... in turn, will force changes in management structure issues.

(more on the topic to follow)