Page 49 - RusRPTJan21

3.2 ​Macro outlook
In the latest Russia Economic Report the World Bank projects Russia's GDP to contract by 4% in 2020, improving the outlook from previous 6% decline predicted in the previous September's report. The revision reflects the better-than-anticipated economic performance in 3Q20, but coronavirus (COVID-19) resurgence is expected to maintain the pressure in 4Q20. Previously the ​risks associated with the second wave of coronavirus (COVID-19)​ have called the ​official economic outlook of the Ministry of Economic Development into question​.
The transition to fiscal consolidation may restrain the recovery rate of growth of the Russian economy after the pandemic crisis, NKR analysts believe and could cut 1% to 2% off growth in 2021.
Non-interest spending of the expanded budget of Russia (federal level, regions and social funds) in 2021 will decrease by 2-3% of GDP relative to 2020, depending on the extent to, which the federal budget spends the carry-over balances from 2019 (including funds of the government reserve fund ), follows from the data of the Ministry of Finance of Russia.
Given such a scale of the planned cuts in the expanded budget expenditures, it can subtract up to 1 percentage point of GDP from economic growth in 2021, estimated for RBC a senior economist at the British consulting company Oxford Economics Evgenia Sleptsova, based on fiscal multipliers for Russia.
Russian GDP growth in 2021 forecasts
Alfa Bank
2.5%
Sova Capital
2.8%
Economic Development Ministry
2.7%-3.3%
CBR
3%-4%
World Bank
2.7%
IMF
3%-3.5%
49 ​RUSSIA Country Report​ January 2021 ​ ​www.intellinews.com