Page 69 - RusRPTMar23

The decline in Russia's GDP in 2022 will be 2.7%, Finance Minister Anton
Siluanov said. In April, the Ministry of Finance, according to Bloomberg
sources, predicted a fall in Russia's GDP in 2022 by 12%.
In September, the Ministry of Economic Development sharply improved the forecast for the decline of the Russian economy. According to it, Russia's GDP in 2022 will decrease by 2.9%, and not by 4.2%, as previously expected, and in 2023 it will grow by 0.8%. In 2024 and 2025, the Russian economy, according to the agency's expectations, will grow by an average of 2.6%. At the same time, from the draft of the main parametres of the scenario conditions for the development of the economy for 2023-2025, which Forbes obtained access to , it followed that in 2022 the decline in GDP will be 4.2%, and in 2023 - 2.7%.
According to the November forecast of the Organization for Economic Cooperation and Development (OECD), the Russian economy will contract by 3.9% in 2022 and another 5.6% next year. According to analysts at Bloomberg Economics, by the end of 2022, the Russian economy will contract by 3.5%, and by 2% by the end of 2023.
The fall in Russia's GDP in 2023 will be 3%, according to the medium- term forecast of the rating agency Moody's, RBC reports with reference to the published forecast. The agency's analysts noted that their initial forecast of a 7% fall in Russia's GDP in 2022 did not come true. At the same time, sanctions against Russian exports and the severing of economic ties with the West will lead to a “deepening recession” in the Russian Federation, a weakening of the growth potential of the Russian economy and a weakening of the ruble. At the same time, in 2024, GDP may already return to growth, having increased by 1%.
Moody’s says the reduction in oil production, the agency expects, may exceed the previously announced 500,000 b/d, while maintaining the price ceiling for oil and petroleum products, which will lead to an even greater decline in GDP. Analysts predict the federal budget deficit at 3.5% of GDP, while the Russian authorities' forecast of 2% of GDP is based on "optimistic macroeconomic assumptions."The situation in the economy may force the country's authorities to resort to "unorthodox" [financial] policies, analysts say. In particular, we are talking about "monetary financing" of the budget, they believe. Moody's predicts that most of the budget deficit will be offset by the National Welfare Fund (NWF). With Urals prices at $50 per barrel. the liquid part of the NWF will be exhausted by 2027, analysts admit. In the longer term, the Russian budget will increasingly depend on the banking sector, analysts said.
The European Commission has improved its economic forecast despite the war in Ukraine. Europe will manage to avoid the recession that was expected at the beginning of the year, the European Commission believes. In particular, it is noted that almost a year after the start of Russia's war against Ukraine, the EU economy entered 2023 in a better state than was predicted in
69 RUSSIA Country Report March 2023 www.intellinews.com