Page 60 - RusRPTNov21

5.0 External Sector & Trade 5.1 External sector overview
In January-July 2021, Russia's foreign trade turnover amounted,
according to the Bank of Russia, to $425.7bn (135.6% to January-July 2020), including exports - $258.2bn (140, 0%), imports - $167.5bn (129.3%). The trade balance remained positive, $90.7bn (in January-July 2020 - positive, $54.9bn).
Russia's trade surplus widened to $17.1bn in August of 2021 from $3.3bn in the corresponding month of the previous year. Exports surged 85.3% to $43.2bn, the third-highest level recorded, boosted by sales to non-CIS (94.4%) and CIS countries (43.2%). Meanwhile, imports rose at a softer 30.6% to $26bn, driven by purchases from non-CIS (31.3%) and CIS countries (25%).
Preliminary balance-of-payments figures from the Central Bank of Russia show that the value of Russia’s exports of goods and services in the third quarter hit $148bn, a 65% y/y increase.
“We believe the report shows that we can expect a notable revision of the balance of payments (BoP) CBR's July projections: from $88bn, it could shift up to $110bn-$120bn. We expect the current account strength to carry over into 4Q21 (supported by both commodities prices and growing export volumes), which we see as a positive development for the RUB,” said Isakov. “Our forecast for the full year surplus is $115bn-$120bn, which, if our estimates are correct, would exceed the 2018 historical high (and adds to the similarities between 2021 and 2018).”
Export earnings were close to the peak years of 2011–2013, when crude oil prices soared to historical highs, averaging $110 a barrel. In July-September, in contrast, the average oil price was just $70 a barrel. Exports of goods other than oil & gas indeed had a substantial contribution to total export growth. The value of these exports broke an all-time record in the third quarter supported by the buoying demand and rapidly rising prices of several raw materials in the global markets.
In the third quarter, the value of Russian goods and services imports was $96bn, an increase of 30% y/y. The rise in imports slowed sharply from previous months, while imports exceeded pre-COVID levels. Goods imports have driven the recovery in imports. Services imports have only slightly recovered since the COVID Recession.
The rapid growth in exports also lifted Russia’s third-quarter current account surplus to a record $41bn. The total current account surplus for the last four quarters corresponds to about 5% of GDP.
The increase in export earnings has also been reflected in Russia’s foreign currency and gold reserves, the value of which stands at a historical high. The value of Russia’s currency reserves was also
60 RUSSIA Country Report November 2021 www.intellinews.com