18 May 2023 11:51

Growth in Russia's GDP could slightly exceed 1.2% in 2023 if current trends continue - Reshetnikov

KAZAN. May 18 (Interfax) - Growth in the Russian economy could slightly exceed the current official forecast of 1.2% in 2023 if current trends continue, Economic Development Minister Maxim Reshetnikov said on Thursday during a speech at the Russia - Islamic World: Kazan Forum international economic forum.

"The GDP estimate for the first quarter was released yesterday at an expected contraction of 1.9% [in annual terms]. However, it turned out to be substantially lower than the estimates of the economic departments, including our ministry. We had assumed that the drop in the first quarter would be more than 2%. We have already seen fairly stable growth since March (...) As of today, we expect the economy to grow by 1.2%, though the first-quarter data indicate that if current trends continue, then we could even probably see a bit more [growth in 2023]," Reshetnikov said at the forum.

Rosstat on Wednesday reported that Russia's GDP in the Q1 2023 decreased 1.9% compared to Q1 last year. Rosstat's data turned out to be somewhat better than the estimates from the Economic Development Ministry (-2.2%), the Central Bank (-2.3%) and analysts' expectations (the Interfax consensus forecast suggested a decline of 2.4% in the first quarter).

Russian GDP in Q4 2022 fell 2.7% in annual terms; in Q3 2022, it fell 3.5%; in Q2 2022 4.5%, and in Q1 2022, it grew 3.0%. In total, in 2022, Russian GDP decreased 2.1%.

As reported, the Central Bank expects Russian GDP growth in Q2 2023 of 4.2% in annual terms against the backdrop of a low base last year.

On April 28, the Central Bank improved its forecast for the dynamics of Russia's GDP in 2023 to growth in the range of 0.5-2.0% instead of the -1% to +1% published in February.

The official April forecast from the Economic Development Ministry for Russian GDP growth in 2023 is 1.2%.

The consensus forecast of analysts polled by Interfax in early May is more conservative in terms of GDP movements in 2023 than official forecasts, and assumes zero dynamics for the Russian economy this year.