Translated with AI
Economic growth in the post-Soviet countries is projected to be 2.1 percent in 2026, below the 2.2 percent in 2025, the UN reports in a new report.
Average GDP growth rates in the region slowed in 2025, primarily due to a slowdown in the Russian Federation. At the same time, most countries in the Caucasus and Central Asia maintained strong momentum, which is expected to continue this year. These countries' limited dependence on the US market reduces the impact of high US tariffs on their economies.
Russia: GDP growth is projected to be 1.0 percent in 2026, down from 0.8 percent in 2025. Despite moderate monetary easing, economic growth will be constrained by labor shortages, declining private consumption, and fiscal tightening. The Russian economy remains subject to sanctions, particularly those restricting oil exports and access to high-tech products.
Ukraine: GDP growth is expected to reach 2.3 percent, following 1.5 percent in 2025. The country's economy faced challenges last year due to military conflict and disruptions in energy infrastructure, which reduced electricity generation capacity. The outlook remains uncertain due to the military situation and the scale of reconstruction efforts.
Caucasus and Central Asia: Most countries in the subregion maintain robust growth, supported by strong domestic demand. The main drivers of this positive trend include robust private consumption, rising real incomes, declining unemployment, a stable inflow of remittances, and active household lending. Public investment, including regional infrastructure projects, is also contributing to growth.
Inflation: The report notes accelerating inflation in many CIS countries. Causes include rising food prices, large-scale budget expenditures, and country-specific factors. Globally, climate disruptions complicate the situation. Experts emphasize that monetary policy must be complemented by robust fiscal, social, and industrial measures aimed at strengthening production capacity and supply chains.
