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on May 14. The estimates don't take the new US sanctions imposed in April into account.
The European Bank for Reconstruction and Development (EBRD) has cut Russia’s 2018 growth forecast to 1.5%, the same level as 2017, and down from a previous 1.7% forecast.
The development bank also predicted 1.5% growth for 2019 as well.
"Growth will be supported by continued recovery in consumption and increased investment, as well as high oil prices and stabilization of the macroeconomic situation," the EBRD said in its regular economic outlook.
The main risks for the economy are from oil prices. The budget assumes a modest $44 per barrel, but oil prices have recently been driven up by instability in the Middle East. Oil prices have averaged over $60 a month for the first three months of this year and topped a four-year high reaching $76 on May 10. Russia’s budget now breaks even at around $60, according to various estimates.
The International Monetary Fund (IMF) keeps its forecast for Russian GDP growth this year steady at 1.7% despite increased pressure from Western sanctions, the IMF's mission chief to Russia Ernesto Ramirez Rigo told the press in May 23. Rigo argued that said the sanctions imposed on Russia were not the only factor in the IMF’s calculation and that it also took into account oil prices that were currently higher than the IMF expected. The fund maintains the GDP outlook for 2019 at 1.5%. In the meantime Russia's President Vladimir Putin is set to meet IMF's head Christine Lagarde at the St. Petersburg Economic Forum, according to presidential aide Yuri Ushakov. “We expect the President will raise the topic of reforming the International Monetary Fund. From our point of view, the current distribution of quotas to the capital of the Fund favoring Western nations is not completely fair and do not reflect, in particular, the specific ratio of rapidly developing economies,” Ushakov said as cited by Tass.
30 RUSSIA Country Report June 2018 www.intellinews.com