BOFIT Forecast for Russia 2014-2016 / 1
JulkaisusarjaBOFIT Forecast for Russia
JulkaisijaBank of Finland
Julkaisun pysyvä osoite onhttps://urn.fi/URN:NBN:fi:bof-20140807824
Russian GDP growth of 1.3% last year undershot forecasts, due to a tangible slowdown in domestic demand. There was a steep decline in fixed capital investments of state enterprises and the state. Consumption growth slowed. Despite a pickup in global economic growth and world trade, growth of the Russian economy will slow further this year as the events in the Crimea cause the postponement of investments. Imports will take a slight dip. In 2015 and 2016, we do not expect the oil price to rise, butt growth in Russia will pick up slightly as the global economy continues to revive. As long as the effects of the Crimean events stay contained, the economy should still grow about one and a half per cent p.a. in 2015 and 2016. Import growth should run at a couple of per cent p.a. Output growth may become constrained by the capital stock and low productivity gains due to weak fixed capital investments. The forecast is subject to substantial downside especially as regards the effects of the Crimean situation. Russia's leadership could respond to weak growth with higher state spending and boosting credit via the banking system. In the longer term, Russian economic growth will stay at about a 2% p.a. trend, if Russia does not move ahead with necessary systemic reforms faster and on a broader basis than in recent years.