Kudrin predicts a fall in Russia’s GDP by 2.9-3.3% in 2022

Chairman of the Accounts Chamber Alexei Kudrin believes that the fall in Russia’s GDP this year will be 2.9-3.3%. He stated this in interview R.T. The last time the Central Bank predicted the decline in GDP is approximately at the same level: minus 3–3.5% at the end of the year.

“The unprecedented sanctions regime that was introduced against Russia, of course, affects our economy, and initially it was predicted that GDP would fall by more than 7%. Nevertheless, now, I think, the fall will be only about 2.9-3.3%,” Mr. Kudrin said.

According to the head of the Accounts Chamber, part of the burden of reducing GDP will be transferred to 2023. He did not rule out “difficult scenarios” given possible restrictions on the sale of Russian oil or the introduction of a cap on energy prices. According to Mr. Kudrin, the Russian economy will need about two or three years to return to pre-crisis levels.

In 2022, inflation in Russia will be 12%, the next – from 5 to 8%, and the level of price growth of 4%, which they want to achieve in the department, can only be achieved in 2024 or 2025, the head of the Accounts Chamber believes. The key rate, which is now is 7.5% per annum, will continue to decline, said Mr. Kudrin.

In his opinion, the budget deficit may exceed the forecasts of the authorities, but Russia has a “margin of safety” due to accumulated reserves, including from the sale of oil. Mr. Kudrin said that “in the next three years, we can not worry that Russia will have a hard time.”

According to the report of the Central Bank on monetary policy, the economic situation in the country may worsen due to the effect of accumulated problems. They will fully manifest themselves in 2023. The regulator estimated the fall in GDP in the third quarter of this year at 4%, and in the fourth it may already exceed 7%.

Read more about the problems that the Russian economy will face in the publication “Kommersant FM” “The economy picks up the scenario”.

Erdni Kagaltynov