7 Mar 2023 14:29

Russian economy continuing to recover in early 2023, including consumer demand - minister

MOSCOW. March 7 (Interfax) - The Russian economy continued to recover in January, seeing seasonally adjusted growth in GDP, industry, freight turnover and construction, Economic Development Minister Maxim Reshetnikov said at a meeting with State Duma committees ahead of the government's annual report.

"Russia's GDP shrank by 2.1% last year. Data for January show that the economy, seasonally adjusted compared to December, is continuing to recover," he said. GDP rose by a seasonally adjusted 0.2% month-on-month in January.

"The situation improved in industry in January [with seasonally adjusted growth of 0.2%] on the back of manufacturing. The development of transport and logistics corridors helped to maintain a positive dynamic in the freight turnover [which grew by a seasonally adjusted 3.4%]. The construction sector continues to grow [expanding by a seasonally adjusted 0.3%]," Reshetnikov said.

"The situation on the labor market is stable - in January there was another all-time [unemployment rate] low of 3.6%. Consumer demand is recovering - we see this by the January results. All this is being accompanied by the slowdown of inflation. We expect a fairly significant slowdown [of inflation] year-on-year in the coming weeks based on what it was last year," Reshetnikov said.

He said the number one priority is the reorientation of sales markets. "It's important to ramp up trade with countries where there are large markets - Asia, Black Sea countries, the EAEU - and where we see opportunities for developing partnerships - Middle Eastern countries, Southeast Asia, Africa and Latin America," Reshetnikov said.

"There are instruments for this. Thanks to free trade agreements with countries in the CIS and Asia, a market of 300 million people is open to us. And following negotiations with Iran, the UAE and Indonesia, a market of several hundred million more people will form," he said.

He reiterated that there is no alternative to the World Trade Organization. "We will continue to promote our interests in the WTO. The institution remains a singular mechanism for civilized development of trade," Reshetnikov said.

Another strategic priority is to attract investment, he said. "In order to reduce risks for businesses, we are increasing the role of the state as 'investor of last resort,'" Reshetnikov said. He also cited the relaunch of investment protection and promotion agreements and the so-called project financing factory.

The minister also said that National Welfare Fund resources continue to be used to finance major infrastructure projects, including the expansion of Russia's eastern railways.