13 Dec 2022 13:00

Capital investment growth now expected for Russia in 2022, despite previous forecasts - econ minister

MOSCOW. Dec 13 (Interfax) - Capital investment in Russia is likely to grow in 2022 as a whole, judging by figures for the first nine months of the year and despite previous forecasts to the contrary, said Maxim Reshetnikov, the economic development minister.

"It is already clear there'll be positive investment dynamics for the year as a whole. It will be possible to give specific numbers based on the results," he said at a meeting to discuss project finance factory projects with regional governors and hosted by the VEB.RF state corporation.

The Econ Ministry had forecast investment would fall in 2022, by 2%.

Rosstat said last week that capital investment had risen by 3.1% quarter-on-quarter in Q3 after rising 4.1% in Q2 and 12.8% in Q1; and by an estimated 5.9% year-on-year in January-September 2022.

"The pace of investment right now, in current conditions is key to the economic agenda," Reshetnikov said.

"Our main problem today, what has been debated in recent months, is the balance of supply and demand. On the one hand, we see that demand is not active enough at the moment. In principle, it can be encouraged further, including by discussing monetary policy issues with the Central Bank, and fiscal impetus and increased budget spending with the Finance Ministry. But the key point that our colleagues are putting to us is that of supply, to what extent the economy is now able to respond to higher demand by expanding supply," he said.

"This actually depends on two factors: imports, the ability to import goods; and the ability of our enterprises to increase output. Realizing that we are in a zone of structural changes, we understand that changes in supply, supply growth in the current situation are impossible without higher investment," he said.