According to the results of the current year, the decline of the Russian economy may be significantly less deep than in the current forecast of the Ministry of Economic Development (7.8%), said in an interview with “Interfax” First Deputy Prime Minister of the Russian Federation Andrei Belousov on the platform of the St. Petersburg International Economic Forum. In 2023, in his opinion, the dynamics of the economy will be around zero, a slight decrease is possible due to the high base of the 1st quarter of 2022.

“As for the current year, the estimate given by the Ministry of Economic Development for this year – rounded minus 8% (the ministry’s current official forecast is a decline of 7.8%) – is, I would say, the maximum in terms of the depth of the decline,” he said.

“According to calculations and the processes that are now unfolding in the economy, I think that the recession will be less – somewhere in the range of 3% to 5%,” the first deputy prime minister voiced his expectations.

“There are several conditions under which the recession will reach the range we talked about (3-5%). The most important is the growth of domestic demand,” he emphasized.

“If there is no growth in domestic demand, it will mean that we will get approximately the recession that the Ministry of Economic Development is now forecasting. If the joint efforts of the Bank of Russia and the government manage to wake up domestic demand, to revitalize it, we may get this year’s recession, I think, in the proportions we are talking about now – somewhere between 3-5%,” Belousov explained his more optimistic assessment.

“As for next year, I think it is about zero values, that is, the dynamics is about zero. But statistically there may be a small minus, because we had a very successful first quarter of this year, and the investment growth was double-digit – 12.8% (Q1 2022 to Q1 2021), and GDP is high enough – 3.5% (Q1 2022 to Q1 2021), so there will be a high base effect,” – he explained why the economy next year may show a slight minus.

The current forecast of the Central Bank on the decline in GDP of the Russian Federation in 2022 is 8-10%, the forecast of the Ministry of Economic Development – a decline of 7.8%. At the same time, both the Central Bank and the Ministry of Economic Development have already stated that they intend to revise their forecasts in the direction of a smaller decline.

The Ministry of Economic Development earlier estimated the decline in Russian GDP in April 2022 at 3.0% year-on-year after growth of 1.3% in March, 4.1% in February and 5.6% in January. The ministry estimated GDP growth in January-April 2022 at 1.7% year-on-year.