The economic current system of Russia

Russia's economic system is a mixed economy combining market and state roles, driven by oil and natural gas exports plus mining, manufacturing, and agriculture, now reshaped by Western sanctions since 2022. What type of economic system does Russia have? The 2026 Index of Economic Freedom scores it about 52 of 100 as Mostly Unfree, around 135th globally.

This article is about the current economic system of Russia (2026)

What is the economic system of Russia? The economy of Russia is based on a mixed economy. The country’s economic system combines elements of a market economy and a planned economy.

Russia’s economy, one of the largest globally, is driven by energy exports, mainly oil and natural gas. Other sectors include mining, manufacturing (automotive, defense), and agriculture (wheat, barley). It also has a significant services sector, including IT and retail. Since February 2022, Russia’s economy has operated under extensive Western sanctions following its full-scale invasion of Ukraine, which has reshaped trade patterns and limited access to international financial markets.

In Russia, the economy is composed of a private sector, consisting of individuals and businesses that make autonomous decisions based on self-interest, and a public sector, where the state determines the production and distribution of certain goods and services. No country is purely capitalist or purely communist.

Moscow illustrating the current economic system of Russia

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What do the freedom indexes tell about the economic system of Russia?

Now, to determine if a country is mostly a market economy or a planned economy, it is useful to examine some economic indexes. For instance, according to the 2026 Index of Economic Freedom, which measures the ability of every human to control his own labor and property, Russia scores approximately 52 out of 100 (As of 2025–2026) and is ranked in the Mostly Unfree category, placing it around 135th globally and among the lowest-ranked European economies.

In a similar way, the Freedom House Freedom in the World 2026 report evaluates the state of political rights and civil liberties globally. Generally, market economies tend to align more with democracy and freedom, while command economies tend to be characterized by greater state control and fewer democratic and civil liberty protections. Russia gets a score of 12/100 (As of 2026), which qualifies it as Not Free.

Russia is a country where the government controls what people do for political reasons, and people have limited freedom to choose (what, how much, and how to produce, whether to buy or not, selling price, etc.)

The Link Between Public Sector Employment and the Economic System of Russia

An indicator of the extent to which the State is involved in the economy is the number of public sector employees. In Russia, according to ILOSTAT, the most recent available figure for public sector employees as a percentage of the total workforce was approximately 40.6% (2011 survey). A more recent comparable figure has not been published by ILOSTAT. This is substantially higher than the global average of roughly 10%, which is consistent with Russia’s large state-owned enterprise sector.

In the country’s mixed economy, the number of public sector employees as a percentage of the total workforce varies based on the specific policies and practices adopted by the State. Some economic activities are left to the private sector while others are under government control. The bigger the public sector the closer the economy is to being a command economy.

What do the biggest companies in Russia say about the country’s economic system?

The biggest company in Russia by revenue should also be looked at, as well as whether it is a state-owned or private company. Russia’s largest companies by revenue are both state-controlled energy giants: Gazprom and Rosneft each reported revenues exceeding RUB 10 trillion (approximately $110–115 billion USD) in 2024, according to company financial reports. Gazprom is the world’s largest natural gas producer, while Rosneft is Russia’s leading oil company. Both are majority state-owned. Sberbank, also majority state-owned via the Russian government (through the Ministry of Finance), is Russia’s largest bank and a leading financial institution.

Top 10 Biggest companies by revenue in Russia (2023 data)

The historical factors that have influenced the economic system of Russia

The mixed economy system of Russia was caused by a combination of factors, including the collapse of the Soviet Union, the liberalization of the economy, and the introduction of market reforms.

These changes allowed for the emergence of private enterprise, increased competition, and the development of a more open and competitive market system. This has resulted in a more diversified and dynamic economy, with a greater emphasis on private ownership and market forces.

But, there are still a lot of remnants of the centrally planned communist economy. The economy has one of the highest public sector employment shares globally, and its biggest companies are state-owned. This shows how the Russian government still has significant control over the economy and its people.