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In the early days of 2018, the Russian economy is stagnating.Last year, Russia's GDP-growth rate was 1.5 percent, compared to 2.5 percent in the eurozone and 2.3 percent in the United States – both developed economies that should be growing 2-3 percentage points slower than a developing economy like Russia.Boosting Russia's growth will be possible only with deep structural reforms, because the economy is stagnating at full capacity. The financial sanctions that followed Russia's forced "reunification with Crimea" in 2014 intensified Russia's isolation further, as has the country's own moves to retaliate: a series of sweeping trade restrictions, including outright bans of food imports from the European Union and the U.S. lifting these restrictions would not only give the economy an immediate boost, but also increase long-term GDP growth.If Russia is to build a genuinely dynamic economy underpinned by globally competitive industries, it will need a stronger private sector.Economic reform begins with political change. But for Russia, political change does not seem to be in the offing. Alexey Navalny, a popular opposition leader, is campaigning on an anti-corruption platform that actually addresses the structural challenges affecting Russia's economy and includes some necessary pro-market reforms.
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