In the first half of this year, the share of loss-making organizations in Russia increased to 30.4%, which is the highest since 2020.
Points of attention
- 30.4% of Russian companies became unprofitable in the first half of 2021, marking the highest rate since 2020.
- The coal industry, energy, and water supply sectors are experiencing the largest losses, raising the risk of bankruptcy for many companies.
- The increasing unprofitability is resulting in reduced tax revenues, lower investment activity, and a growing debt burden, impacting the overall economy.
The Russian economy is close to collapse
In particular, during this period, almost 19 thousand companies reported cumulative losses of over $62 billion.
For comparison: in most developed countries, the share of unprofitable enterprises is 10–20%.
According to intelligence data, the largest losses were recorded in the coal industry, energy, water supply, and waste disposal.
In addition, construction and the production of durable goods, from cars to industrial equipment, remain under pressure.
Growing unprofitability reduces tax revenues, reduces investment activity, and increases the debt burden.
This forces banks to restructure loans more often and increases the risk of bankruptcies and inflationary pressure — as a result, a further increase in the share of loss-making companies is expected in Russia, — the SZRU concluded.
