Russian GDP could fall less than 3% in 2022, 0.6%-0.8% in 2023

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Russian GDP could fall less than 3% in 2022, 0.6%-0.8% in 2023 - Belousov

MOSCOW. Aug 29 (Interfax) - Russian GDP could fall 3% at most in 2022, possibly by just over 2%, and then edge down 0.6%-0.8% in 2023, First Deputy Prime Minister Andrei Belousov said.

"The overall picture [in the economy] is now better than it seemed before. If we sum up all the conclusions and trends, I can say that most likely this year - the general economic results, if measured in terms of GDP dynamics - we will have decline of less than 3% - something like 2% or just above, and next year we have every chance of limiting the decline to 1% and have minus 0.6-0.8%," he said at a meeting of the presidium of the government commission on improving the stability of the Russian economy amid sanctions.

"This puts very good conditions in place for real incomes to grow, and for budget revenue to grow next year and, accordingly, in 2024-2025. But we must of course fight for this," Belousov said.

Belousov's figures are much better than the latest estimates given by the Russian Economic Development Ministry and Central Bank.

Russia's Economic Development Ministry in the middle of August submitted the draft of the main scenario parameters for the macroeconomic forecast for 2022-2025, endorsed by the finance and energy ministries, to the budget commission. The ministry's baseline scenario now sees Russian GDP shrinking by only 4.2% in 2022 rather than the 7.8% projected by the May forecast. The Central Bank forecast at the end of July that the economy will shrink by 4-6% this year.

The Federal Statistics Service reported earlier that GDP fell 4.0% year-on-year in the second quarter of 2022 after growing 3.5% in the first quarter. The Economic Development Ministry estimated that GDP slumped 0.5% year-on-year in the first half of 2022 overall.

The ministry's forecast for next year, meanwhile, is more pessimistic. It now expects GDP to contract by 2.7% in 2023 rather than the 0.7% it forecast in May. This falls within the range of the 1-4% slump the CBR forecast for 2023.