Overview

Russia’s economy is the eleventh largest economy in the world. The country has a highly educated population and a lot of natural resources. These strengths include large supplies of gas, oil, coal and precious metals. But Russia’s economy also deals with the cultural problems of communism. Since the end of Soviet communism, Russia has had to face many economic challenges. These events have made Russia’s economy somewhat unstable. The country has many wealthy people, but there is increased conflict among the wealthy and poor. These tensions make Russia’s economy weaker than other countries in Europe. The political situation is another area of concern. Creating a bigger middle class will be the goal of Russia’s economy. With the worldwide recession of 2008 and 2009, Russia’s economy is now in the middle of massive pressure.

End of Communism

The biggest challenge for Russia’s economy was the end of communism. In the USSR, the state controlled the economy. Today, Russia has a capitalist economy with free trade. At the beginning, this new system was a shock to many Russians. Capitalism had never been tried in Russia. An open economy with competition was not common for most of Russian history. Citizens had to learn about the politics of this new system and adjust. During this time, there were major protests and attention from reporters worldwide. People had to find jobs and create companies on their own. Some businesses did very well, while others failed and the Russian economy fell.

The New Economy

Russia’s economy had other problems resulting from the change from communism to capitalism. In 1998, there was a serious financial crisis because of too much borrowing and lower prices for oil and minerals. Investors left Russia and many banks went out of business. At this time, inflation became a big risk and the Russia economy almost collapsed. The country survived these challenges. Investment increased, more people found jobs and inflation went down. Now the World Bank says Russia’s economy is stable.

Oil Economy

Today, Russia’s economy is very successful because of the high price of oil. The country has the vast oil reserves that many buyers need. Many countries in Europe and Asia use Russia’s oil to run businesses and cities. This money then makes Russia’s economy even more powerful. The sale of oil has also created more jobs and investment in Russia. The price of Russian oil may go even higher because of political problems that the Middle East that is currently experiencing. These events could make Russia’s economy even stronger.

Technology and the Internet

Russia’s economy also supports many technology companies. A lot of Russians have important and valuable skills in this area. The Internet is a main source of income for many Russians in one form or another. These benefits help companies that need highly trained workers. Many of these people will work for less than their counterparts in Europe and the United States. This fact is a plus for employers worldwide. These workers focus on software, computer programming and online sales. Russia’s economy is slowly becoming a major success and investors want to join the action. Communism is long gone and Russia is a leader. The economy will grow in this environment and produce more jobs, making Russia even more stable and successful in the long run.