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FNPR Newsletter. January 16, 2023

16.01.2023

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16 January, 2023

The year's end is a natural reason to sum up its results and look into the future. Trade unions of Russia assess the past year primarily on the basis of economic conditions their members had to work in. On the whole, despite significant changes in cooperation chains, export-import relations and monetary policy, we appraise the results of 2022 as satisfactory.

The unemployment rate by the end of the year reached a historic low of 3.7%. The average wages of employees increased by 3.2% in the second half of the year although real incomes of the population fell by 1.5% due to inflation which was slowing down for five months in a row and amounted to 11.94% for the year. According to the Ministry of labour, over 40 different payments, benefits and compensations will be indexed by the amount of inflation as of February 1.

Russian producers have mostly coped with import substitution, in certain cases making up for the missing supplies through parallel imports. The withdrawal of foreign companies from the domestic market stimulates local manufacturers to buy out abandoned assets and resume the production of goods under Russian brands.

By the end of 2022, the range of imported foods was almost completely replaced by Russian-produced foodstuffs: this is what happened to internationally renowned food and beverage manufacturers like Coca-Cola, McDonald's, Pepsico, Valio, Unilever, Paulig, etc. A similar, though much slower replacement takes place in the sphere of electronics, furniture and household goods production; new car models are gradually introduced by auto companies. Although the retail consumer market has shrunk by 9%, it does not show signs of an irreplaceable deficit or consumer panic.

Performance figures of the base material sectors have exceeded the level of 2021: manufacturers are actively shifting their focus to other markets after the Western minority collectively decided to close their countries to Russian products. Manufacturing industries have gained further growth momentum owing to partial liberation of the market from foreign goods, as well as the necessity to meet the increased needs of the Russian army.

By the end of 2022, Russia's GDP decreased by 2.7%. At the same time, since the middle of last year, there has been a gradual increase in production of goods and services which allows projecting the GDP growth for 2023 at 0.8% (forecast of the Ministry of Economic Development of the Russian Federation), and 2.6% per annum for 2024-2025.

As can be seen from the above figures supported by international estimates, Russian economy has not "fallen into a tailspin" or "torn to shreds": it continues to develop steadily despite the imposition to date of nine European packages totalling over 10,000 "infernal" sanctions which, according to their masterminds, were supposed to force Russia to abandon its sovereign independent policy.

The European Union along with other G7 countries and Australia keep coming up with various new restrictions which should somehow affect the economy of our country. They put the so-called "price caps" on petroleum products supplied by sea, impose embargo on oil supplies to Europe, struggle to invent limits on the marginal price of gas and continue to experience the results of such insane experiments.

In response to these hostile actions the Russian authorities have decided to give up trade with countries that would apply non-market mechanisms to regulate international market prices for any products.

Measures to hold back the Russian economy include unprecedented attempts to appropriate our gold and foreign exchange reserves trapped in the West. In fact, those funds are generated through tax revenues from the working population and the economic activity.

It should be noted that excess oil and gas revenues in Russia are accumulated in a separate National Welfare Fund which is not linked to the budgetary part in the form of gold and currency reserves. The "collective West" firstly announced the freezing of Russian foreign assets in the amount of approximately USD 300 billion, and is now trying to develop some "legal grounds" and mechanisms for using it to cover their own expenditures for military and humanitarian assistance to the Ukrainian nationalist regime.

Russian trade union movement regards such attempts as an outright robbery which will not remain without response. In the event of such "confiscation" of international reserves, Russian economic experts propose to nationalise corresponding foreign assets still under our jurisdiction.

The practice of Western political institutions to mislead their partners manifested itself with particular clarity in December 2022, when former German Chancellor Angela Merkel made revelations about the motives of her behaviour during the signing and operation of the so-called "Minsk Agreements".

As is known, the Minsk Agreements were concluded in 2014-2015 by a Trilateral Contact Group consisting of representatives of Russia, Ukraine and the OSCE with the participation of the leaders of Russia, Ukraine, Germany and France. The purpose of the Agreements was to settle the internal Ukrainian armed conflict in the Donbass (two eastern regions of the country). The Agreements were approved by a special resolution of the UN Security Council.

The key actor in those Agreements was the Government of Ukraine which pledged to make efforts for a peaceful settlement of the conflict. However, as it turns out now, Germany’s former Chancellor, by her own admission, did not initially intend to seek a peaceful solution, but to allow the Ukrainian regime time to prepare for military confrontation with Russia.

Recall that during the period of the Minsk Agreements (2014-2022), as a result of the indiscriminate use of military force by the Ukrainian regime against the civilian population of the Donbass, more than 14,000 people were killed on both sides (data from the UN High Commissioner for Human Rights). Over 2.5 million peaceful Ukrainian citizens have fled their places of permanent residence while the actions of the Government of Ukraine caused devastating damage to the infrastructure of its eastern territories. And all this happened with the connivance, and in fact the deception on the part of Russia's "partners" in the settlement of this armed conflict.

The cynical, irresponsible and, in the expression of President Putin, frankly disappointing behaviour of the leading political figure in Europe at that time, should serve as an important lesson for policymakers around the world, including for the trade unions.

The obvious lesson here is that the category of trust in relations with the "collective Western minority" has ceased to exist. The West has decidedly lost its moral authority having gradually moved into the category of untrustworthy. This applies not only to international politics, but also to economic and corporate relations: market principles and mechanisms that were practically destroyed with regard to Russia are now at risk of unpredictable sanctions introduced against any other country or organisation around the world. Production and cooperative chains with Western companies can collapse instantly if politicians in the West decide that the unilaterally established «rules» are violated.

The Federation of Independent Trade Unions of Russia, despite a difficult external environment, continues to strengthen the Russian trade union movement. As is known, at the beginning of October Russian President Vladimir Putin signed four federal constitutional laws on the accession of Donetsk and Lugansk People’s Republics, as well as Zaporozhye and Kherson Regions to the Russian Federation. The four new federal subjects have a combined population of about 6.2 million people, over half of which are working-age citizens, including members of the local trade unions.

The FNPR conducted all necessary negotiations and consultations with trade union organisations of the Donetsk and Lugansk People's Republics and in November 2022 took the decision to accept two new member organisations — federations of trade unions of these republics. The process of integration of sectoral trade unions of the new subjects into all-Russian sectoral trade unions has begun. Work continues on the preparation of accession of Zaporozhye and Kherson regional federations to the FNPR.

The integration of new regions into Russia is a long and resource-intensive process. Already in March 2022, hard and painstaking work on the economic recovery of the Donbass began. The Russian budget provides for substantial spending on construction and infrastructure, which means creating millions of new jobs. The FNPR aims to ensure that these are modern, efficient and decently paid jobs.

Sociological organisations in Russia summarize the results of 2022. According to the Public Opinion Foundation's poll dated December 18, 78 percent of respondents positively assess President Putin's performance. The All-Russian Public Opinion Research Centre (VCIOM) gives the same assessment of Putin's activity (78%). Public support for the Special military operation in Ukraine remains high and amounts to about 70% of respondents. Public opinion on the correctness of the economic and social policy pursued in Russia also remains at a fairly high level: 65% and 69% of respondents were positive on these issues, respectively. 59% of respondents consider the current inflation to be moderate.

To conclude, 2022 has become an exceptional year in recent history. According to numerous political scientists and experts, through its actions Russia has put an end to the liberal globalist project. The world is gradually moving to a different model – a multipolar world order with pronounced regional specifics. Many ideological formulas and clichés that have developed over the post-World War II history have not stood the test of time: they need to be left in the past.

The international trade union movement should rethink the content of its guidelines relating to the unconditional support of liberal democrats and aggressive minorities, recognize the right of trade union members and their organisations to choose their own path of civilisational development, get rid of irresponsible bureaucracy and hypocrisy.