Putin predicted a 2% decline in GDP by the end of the year

President Vladimir Putin believes that the peak of the difficult situation in the Russian economy has already passed. According to him, budget expenditures by the end of 2022 will be 20% higher than in 2021, and the decline “if there is, then insignificant” – 2% of GDP. He promised to “suppress” inflation.

Mr Putin says the economy is “normalizing”. “They predicted that there would be a big recession in the economy. This won’t happen. There will be a decline, but it will be insignificant – somewhere around two, two and a half percent,” the president said at the plenary session of the Eastern Economic Forum.

He said unemployment in Russia is at a historic low of 3.9%. Vladimir Putin also said that inflation at the end of the year could be around 12%, and in the first-second quarters of 2023 it would slow down to 4-6% in annual terms.

First Deputy Prime Minister Andrei Belousov spokethat inflation by the end of the year could reach 12-13%. According to the latest estimate of the Ministry of Economy, Russia’s GDP in 2022 will decrease by 2.9%. Head of department Maxim Reshetnikov arguedthat from 2024 the Russian economy will enter “sustainable growth”.

Bloomberg agency reportedthat a report was prepared for the Russian government, according to which Russia may face a longer and deeper economic recession due to sanctions. Two of the three scenarios show that Russia’s economic downturn will accelerate in 2023. In the Ministry of Economy, such a development of events called “working scarecrow”. Moody’s expectsthat Russia’s GDP will fall by 7% in 2022 and by 3% in 2023.

Read about the state of the Russian economy in the publication “Kommersant” “Unhappy Hills”.

Laura Keffer