3 Feb 2023 10:32

IMF forecast for Russian GDP growth points to recognition of the obvious, dynamic depends on credit stimulus - minister

ALMATY. Feb 3 (Interfax) - The International Monetary Fund's new forecast for the Russian economy, projecting that GDP will grow by 0.3% in 2023, points to the Fund's recognition of obvious things, but the dynamic of the economy will depend on credit stimulus and the recovery of consumer demand, Russian Economic Development Minister Maxim Reshetnikov told reporters in Almaty on Friday.

"Our colleagues have begun to acknowledge obvious things. In 2023, the situation in the economy going forward will depend on the recovery of consumer demand, as well as measures to ensure the growth of lending, both corporate and consumer," Reshetnikov said when asked if his ministry agrees with the IMF forecast that the Russian economy might grow in 2023.

"We will clarify all out estimates for the current and subsequent years in line with the regulation within the context of scenario conditions [in March-April]," Reshetnikov said when asked about the ministry's current expectations.

The IMF released a report on Tuesday in which it revised its forecast for the Russian economy in 2023 to 0.3% growth from a 2.3% contraction, and said it expects growth to accelerate to 2.1% in 2024.

The updated forecast is considerably more optimistic than the current official forecasts of the Russian authorities. The Economic Development Ministry's official forecast projects that GDP will contract by 0.8% in 2023, while the Central Bank expects it to shrink by 1-4%.

The ministry plans to revise its macroeconomic forecast for 2023 in March-April, as specified in regulations, and it does not see any point in responding to immediate fluctuations in oil prices. The Central Bank will update its forecast in February.

Analysts polled by the Central Bank in a monthly survey conducted on January 27-31 expect Russia's GDP to shrink by 1.5% in 2023, though in December they forecast a contraction of 2.4%.

First Deputy Prime Minister Andrei Belousov said at the end of December that the situation in the Russian economy will be "far easier" in 2023 that it was in 2022 and that GDP growth might be in the range of "about zero" to minus 1%.

The Russian economy performed better than the IMF expected in 2022. The Fund's last forecast, made in October, projected a drop of 3.4%, rather than 6% and 8.5% as forecast in July and April, respectively, but according to tentative estimates GDP actually shrank by only about 2.5%. In the report published Tuesday, the IMF itself estimated that Russia's GDP shrank by even less, only 2.2%.