The Impact of Sanctions on the Production and the Foreign Trade of Nizhny Novgorod Region

The purpose of this paper is to assess the impact of sanctions imposed in 2014 on key Russian and regional economic indicators, namely production and foreign trade, on the example of the Nizhny Novgorod region. For this purpose, the main industries that were negatively affected or, on the contrary, stimulated after the imposition of sanctions were identified and the dynamics of key statistical indicators before and after 2014 was analyzed. In addition, the study conducts a comparative analysis of the main economical indicators of the Nizhny Novgorod region and a number of other Russian regions, taking into account their economic and geographical specifics, and also the possible connection between changes in GRP growth in Russian regions after 2014 with different indicators reflecting the structure of their economy and dependence from external factors was investigated. The results of the work show that along with the direct effect of sanctions, an indirect effect also plays an important role, which is reflected in the reduction of investment attractiveness and the restriction of international cooperation of Russian enterprises. However, in addition to the influence of sanctions, the important factors were the decrease of oil prices which took place in 2014, and a sharp depreciation of the ruble, which had a negative impact on the Russian economy, heavily dependent on import of foreign products. Since for most regions, including the Nizhny Novgorod region, some economic indicators, namely foreign trade volumes, began to grow in 2016 already, with external constraints remaining, the impact of price and currency factors seems to be more significant for the Russian economy.