Spotlight: Russia braves challenges, upturn expected

Chocolate has become this year's favorite gift for many Russians for the upcoming new year holiday, instead of red packets with a certain amount of money inside, or fancy smart phones, as their country is braving major challenges.

With skyrocketing commodity prices and steep depreciation of the ruble, the national currency that depreciated by 72.2 percent against the U.S. dollar from March 2014 to December this year, Russians have to pinch every penny.

So does the Russian government.

Facing global oil prices plummeting from around 100 dollars per barrel in early 2014 to about 36 dollars per barrel now, and the extension of Western sanctions, the Ministry of Economic Development forecasted that Russia's GDP would shrink 5 percent and the government's revenue would drop 3 trillion rubles (some 42.8 billion dollars) this year.

The external pressure has just made things worse. The Ukraine crisis, despite glimmers of hope for an upturn in sight, seems to continue to plague Moscow's relations with the West, while the country's ties with Ankara are strained after a Russian fighter jet was downed by Turkey in late November.

Moreover, since Moscow launched its air campaign against targets of the Islamic State (IS) terrorist group in Syria late September, security concerns in the country have been on the rise, as extremists have threatened to bring bloodshed to Russia "in the nearest future."

In the discouraging picture, Russian President Vladimir Putin has urged the country to optimize economic structure, improve governance and attract foreign investment, while turning to the country's Far East region, and making the development of the region "an overriding priority of the 21st century."

Following that, Prime Minister Dmitry Medvedev signed a one-year anti-crisis package in January worth 2.3 trillion rubles (30 billion dollars) to stabilize the domestic economy.

The government also created a "block of advantages" to speed up the socio-economic development of the Far East, including tax breaks, simplification of administrative procedures, and the creation of a single management center.

As Moscow began to look toward the East, it considers China as one of its main potential partners in the region's development, particularly in view of China's Belt and Road initiative and the Russia-initiated Eurasian Economic Union project.

Earlier this month, U.S. rating agency Moody's changed the outlook on Russia's government bond rating to stable from negative, while Credit rating agency Fitch Ratings expected a 0.5 percent growth of the country's GDP in 2016.

At his annual year-end press conference on Dec. 17, Putin assured the Russian people that "Russian economy has passed the peak of the crisis."

Following Russia's air campaign against the IS, which many believed has eclipsed the U.S.-led one, the West has somewhat eased their pressure on the Kremlin over the Ukraine crisis.

From French President Francois Hollande to British Prime Minister David Cameron, and then to U.S. Secretary of State John Kerry, the West has shown substantial willingness to work with Moscow on the anti-terror mission and a political settlement of the protracted conflict in Syria.

In his annual state of the union address to the Federal Assembly earlier this month, Putin made encouraging promise and showed his determination in front of the Russia people.

"There are always difficulties and obstacles on the path to progress and development. We will respond to all challenges. We will be creative and productive. We will work for the common good and for the sake of Russia," he said. Endi