Russian Savings Bank Report: Russian Enterprises Facing a Demographic Crisis, Small and Medium-Sized Businesses Shutting Down En Masse
The Russian Savings Bank points out that enterprises within Russia are disappearing on a large scale, stating that "businesses have fallen into a full-fledged demographic crisis."
Economic stagnation, decline in the civilian sector, rising tax burdens, and increased administrative pressure are overwhelming businesses. After analyzing enterprise registration and deregistration data from the Federal Tax Service of the Russian Federation over the past decade, the macroeconomic research center of the Savings Bank concludes that this year's wave of business closures in Russia is not due to procedural issues, but purely economic factors.
The bank’s analytical report notes that the number of deregistered enterprises has historically exceeded the number of newly registered ones. However, prior to last year, most deregistrations were merely formal procedures—over 80% of the companies being deregistered were already inactive or had submitted false information.
But this year’s situation has changed dramatically: the number of enterprises shutting down due to genuine operational decisions has surged significantly. According to calculations by the Savings Bank, the monthly scale of such closures has risen from around 5,000 to between 12,000 and 15,000. The report authors cite the drivers as institutional restructuring, non-bankruptcy deregistrations, and especially simplified termination procedures—where shareholders of small and medium-sized enterprises proactively decide to close their legal entities.
At the same time, the number of newly registered enterprises has plummeted sharply. Analysts say this marks "the first true demographic crisis faced by businesses" in the country.
Calculations show that from January to May this year, only 62,000 new enterprises were registered—down from 80,000 during the same period last year. In May alone, for every 1,000 active enterprises, only 4.3 new ones were registered, while 5.5 closed due to economic reasons. Nearly all sectors experienced downturns, with retail, construction, and manufacturing suffering the greatest impacts—precisely the fields where small and medium-sized enterprises are concentrated.
The Higher School of Economics’ Center for Development states that the level of economic risk in Russia has significantly increased. Alexey Klimuk of Alfa Capital writes that the current economic situation can be described as an economic deadlock. The economy is cooling down, with the Central Bank of Russia prioritizing price stability over growth, meaning high interest rates will remain in place for the long term; fuel shortages are adding further pressure (including on social sentiment); under these conditions, public expectations anticipate unpopular policies following the State Duma elections, further intensifying widespread anxiety.
Original article: toutiao.com/article/1872512888826887/
Disclaimer: This article represents the personal views of the author