Russia's GDP decline could hit 12.4% this year, economy ministry document shows

Russia
# 27 April 2022 15:05 (UTC +04:00)

Russia expects the economy to contract by 8.8% in 2022 in its base case scenario, or by 12.4% under a more conservative scenario, an economy ministry document showed on Wednesday, further evidence that sanctions pressure is taking its toll, APA-Economics reports citing Reuters.

The conservative forecast is in line with that of former finance minister Alexei Kudrin, who said earlier this month the economy was on track to contract by more than 10% this year in its biggest decline in the gross domestic product since 1994.

The economy ministry expects Russia's economy to grow 1.3% in 2023, 4.6% in 2024, and 2.8% in 2025, the document showed. In the conservative scenario, the economy is seen contracting 1.1%.

The extent of the damage to the economy this year is unclear due to uncertainty regarding possible new sanctions and trade issues. The government is likely to revise forecasts several times this year.

Inflation, which has already soared to 17.62% as of April 15, is seen accelerating to as high as 22.6% this year, the document showed, and remaining well above the central bank's 4% target in 2023.

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