19 Apr 2022 16:11

IMF forecasts Russian economy will shrink 8.5% in 2022

MOSCOW. April 19 (Interfax) - The International Monetary Fund (IMF) thinks the Russian economy will shrink 8.5% in 2022 and 2.3% in 2023, the Fund said in its World Economic Outlook Update.

The IMF said in January that the Russian economy might grow 2.8% in 2022 and 2.1% in 2023.

It said in the latest WEO that global economic growth might be 3.6% in 2022, down from the 4.4% forecast in January and 6.1% growth in 2021. The global economy could rise 3.6% in 2023 also.

So far 2009 has been the worst year in the last quarter of a century for the Russian economy: GDP plummeted that year, the global economic crisis year, and 5.3% in the 1998 default year.

The relative similarity of indicators in 2022 with previous economic slumps should create no illusions that the situation is generally comparable, Central Bank Governor Elvira Nabiullina said in the State Duma on Monday. "If macro indicators look comparable to other crises (inflation, GDP decline), the economic sense will be completely different. This is indeed a serious adaptation of the economy, a serious burden on companies, on the financial system, on the budget," she said.

Analysts told Interfax in a consensus forecast for Interfax at the start of April that they thought Russian GDP would fall 8.4% in 2022. The World Bank is more pessimistic - it thinks Russia's economy will nosedive by 11.2% in 2022.

The IMF forecasts 2.3% inflation for Russia in 2022 and 14.4% in 2023.

Unemployment could be 9.3% in 2022 and 7.8% in 2023.

Budget spending will only partially offset a drop in private investment and consumption.