Page 41 - RusRPTNov19

The World Bank
growth
decreased its forecast for 2019 Russian economic
for the fourth time this year , in part due to low private investment.
The bank now predicts the Russian economy will grow just 1% in 2019, down
from its initial 1.5% projection in January. The organization explains that
“political uncertainty” and the prospects of prolonged economic stagnation
have created a “cool” investment climate that contributed to slower than
expected GDP growth at the beginning of 2019. Other factors leading to the
forecast reduction were weak retail sales due to January’s VAT increase, the
decline in industrial activity due to the OPEC+ agreement to reduce oil
production, and pollution of the Druzhba pipeline, which caused Russia to
suspend oil exports.
The International Monetary Fund (IMF) cut Russia’s growth forecast for the third time this year to 1.1% from the previous 1.6%, the fund said in its latest World Economic Outlook update for October 2019. The GDP growth is expected to recover to 1.9% in 2020. Previous the IMF had forecast Russia’s GDP growth at 1.8% at the start of the year but then cut the forecast to 1.6% growth in April.
The IMF notes that a slowdown in Russia and flat activity in Turkey is largely reflected in the subdued growth in emerging and developing Europe in 2019 overall. But the region is expected to grow at 1.8 % in 2019 and pick up to 2.5% in 2020.
41 RUSSIA Country Report November 2019 www.intellinews.o