Russia will face a two-year recession: the country’s GDP will shrink in 2022 and 2023. This forecast is contained in the updated scenario conditions of economic development for 2023 and the planned 2024-2025 years developed by the Ministry of Economic Development. The document was familiarized with “Vedomosti”.

The Ministry of Economic Development reported that the document was submitted to the government, scenario conditions have already been agreed with the Ministry of Finance and the Ministry of Energy and will soon be sent to the regions to form budgets. It is planned to refine the parameters in July-August. The medium-term forecast was made with the expectation that the sanctions pressure on Russia will continue until 2025.

Russia’s GDP will shrink by 7.8% this year. This is a record decline since the global financial crisis of 2009, Vedomosti notes. The peak of the decline will be in the fourth quarter. Next year the decline will slow down to 0.7%, and in 2024 and 2025 the economy will move to growth of 3.2% and 2.6% respectively, forecasts the Ministry of Economic Development.

The main difficulties in the economy are associated with the disruption of logistics chains, the need to reconfigure production and a significant decrease in imports, primarily of machinery, equipment and components, the ministry said. According to its forecast, imports in 2022 will fall by 27% in physical terms and by 17% in value terms (from $304 billion to $251.9 billion).