Illarionov on the Russian Economic Apocalypse

It’s a Catastrophe

by Andrei Illarionov

A post from the author’s blog

Translated from the Russian by Dave Essel

Russia’s Federal Office of State Statistics and the Russian Government Economy Observation Centre have disclosed data on November’s industrial production trends. If one is only allowed one word to comment these, then that word is “catastrophe”.

Since the Russia’s Federal Office of State Statistic’s site is currently not accessible, I think this is a good time to publish the base statistics with my preliminary analysis.

November saw a drop in industrial output for the fifth consecutive month. Overall production in November was down 6.7% on October. The cumulative fall in production over the last 5 months now amounts to 13%.

Table 1: Industrial Production % change on previous month adjusted for seasonal variations

If the rate at which production dropped in November is extrapolated over a year, one is looking at a real shocker.

Table 2: Industrial Production % change for whole year based on November results and July-November results.

Nothing like last November’s production figures have been recorded for the last 19 years – since January 1990. Results such as these were not recorded even during the worst industrial declines of 1992, 1994, and 1998.

In fact, the last time industrial production in Russia dropped at rates similar to these was during the Second World War: in October-December 1941 and again in May-August 1942.

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Notes:

1. In Table 1, I have corrected a typographical error in the Electric Power entry: -5.5% has been corrected to -8.5%.

2. In Table 2, I have added the third column.