Saint Petersburg, June 20 – Russian President Vladimir Putin on Friday urged government officials to take decisive action to prevent a recession, amid growing concerns from within his own administration about a potential economic downturn.

Speaking at the St. Petersburg International Economic Forum, Putin acknowledged warnings from economists and experts who have raised the specter of stagnation or even a full-blown recession.

"Some specialists and experts are pointing to the risks of stagnation and even a recession," Putin said. "This must not be allowed to happen under any circumstances."

He emphasized the need for "competent, well-thought-out budgetary, tax, and monetary policy" to safeguard economic stability.

Russia’s economy recorded its slowest quarterly growth in two years during the first quarter of 2025, following a period of rapid expansion driven by soaring military spending linked to the ongoing war in Ukraine. While the Kremlin had anticipated a slowdown after years of high output, some officials, including Economy Minister Maksim Reshetnikov, have issued warnings about more serious challenges ahead.

Despite enduring sweeping Western sanctions, Russia’s economy grew throughout 2023 and 2024, bolstered primarily by large-scale defense spending. However, economists have repeatedly cautioned that such growth is unsustainable and does not reflect meaningful improvements in productivity.

Dismissing claims that military and energy sectors are solely responsible for driving the economy, Putin highlighted the role of the financial and technology sectors. "Yes, of course, the defense industry played its part in this regard, but so did the financial and IT industries," he noted.

Calling for “balanced growth,” the Russian president urged his administration to monitor economic indicators closely, stressing the importance of the overall health of industries, companies, and even individual enterprises.

Putin’s remarks underscore a growing sense of unease among Russian policymakers, who now face the dual challenge of maintaining economic momentum while navigating the long-term consequences of prolonged conflict and international isolation.