The country still faces strict sanctions over the Ukraine conflict.

The president of Russia Vladimir Putin has stated that his country is over the economic crisis in spite of the possibility of the country going into a deep recession. Putin said that the economic situation has stabilized after the large drop in the ruble which happened last year. The statement was been reported on Thursday by the state news agency RIA Novosti. “It is completely obvious to the specialists that we have passed the peak in our crisis, however this doesn’t mean that everything will start going our way immediately,” Putin said. In his speech in St. Petersburg during an even which was organized by the Russian People’s Front, which is a campaign group sponsored by the government, Putin also added that Russia will still feel the effects of the economic downfall in the next few months.

Putin stated with confidence that it is clear that no collapse has occurred and that there won’t be one in the future. According to the estimate of the World Bank which was published this month the economy of Russia is predicted to shrink by 3.8 percent by the end of this year and 0.3 percent the next year given the fact that the country is suffering from sanctions, low oil prices and weak investment demand. The low oil prices have dented government revenues and this is a major reason why the government has decided to cut budget spending by 10% across the board leaving only a few protected places left. The government left military costs untouched and major infrastructure projects such as the 2018 soccer World Cup. The value of the ruble has been able to recover very fast this year after it collapsed over a few days during December. During the first quarter in 2015 the ruble was the best performing currency in the world. However the currency of Russia remains more than a third behind the dollar as it was at the start of last year.

The Russian economy was shaken hard last year when it was struck with sanctions from the European Union and the United States over the annexation of the Crimean Peninsula. Because of the sanctions the huge exporter of natural gas, Russia was unable to reach its main market, the Euro zone. Because of this Russia was forced to turn to other markets such as China. The Russian government has also made an agreement with the Argentinean government to extract shale gas in their country.