Shadow economy

World economy

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Russia's shadow economy

Main article: Shadow economy of Russia

2024: WSJ: How US sanctions created a global shadow economy

At the end of May 2024, the publication WSJ published the results of the investigation, showing how unprecedented financial and trade sanctions USA against,,, Russia, and Iran Venezuela North Korea China other authoritarian regimes led to the creation of a global shadow economy.

According to the researchers, Western sanctions and export controls have inadvertently become the basis for the formation of new trade ties, and now the bloc of countries under sanctions has formed its own powerful economy, allowing you to trade anything from drones and missiles to gold and oil.

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Фото: Unsplash

The representative of the Chinese Embassy in Washington, Liu Pengyu, considers Beijing's policy legitimate: "China carries out ordinary trade exchange on the basis of the principles of equality and mutual benefit. Trade with these countries is legal under international law, which means it should be respected and protected. "

As part of the new economic union, China receives oil from the three largest OPEC countries - Russia, Iran and Venezuela - at a significant discount. This is an extremely successful deal for the world's largest oil importer, which last year purchased more than 11 million barrels of oil per day. In turn, oil-producing countries receive income that can be used to buy goods from China, the import of which from other countries has become impossible. Chinese and Russian customs data show that China has given Russia access to priority dual-use goods, that is, products that have both civilian and military uses. At the same time, the countries that have fallen under the sanctions use the Chinese currency and Chinese payment systems, which limits the access of the Western authorities to financial data and prevents monitoring compliance with the sanctions^[1]

2023: Which countries have the largest share of the shadow economy. Russia in 79th place

At the end of 2023, the share of the shadow economy amounted to about 11.8% of the total world GDP. For comparison, in 2000 this figure was estimated at 17.7%. Such data are reflected in a study by the international audit consulting corporation Ernst & Young, the results of which TAdviser got acquainted with at the end of May 2025.

Analysts note that the shadow economy in most countries is showing a reduction in scale, however, it continues to have a significant negative impact on the socio-economic sphere. Activities hidden from society and the state and beyond government control and accounting generate trillions of dollars each year. Governments are taking various measures to combat the shadow economy, and this is a positive result: Ernst & Young estimates that between 2000 and 2023, its volume decreased in 119 of the 131 countries studied. The most significant declines were seen in low-income countries, while high-income states showed the smallest changes - partly due to the smaller initial scale of unregistered activity.

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Фото: Freepik

Leading the share of the shadow economy in 2023 is Sierra Leone with 64.5% of GDP. Niger is in second place with 56.3%, and Nepal closes the top three with 51%. The lowest value was noted in the UAE - 2.1%.

Russia in this rating is in 79th place with an indicator of 13.1% of GDP. In Belarus, the value is 18.3% of GDP, which corresponds to 64th place in the list. The study says that in the United States, the volume of the shadow economy at the end of 2023 was at the level of about 5% of GDP. In Britain, the value is 5.3%, in Germany - 6.8%. In China, an indicator of 20.3% was recorded, in Japan - 6.7%.^[2]

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