The Russian prime minister stated at an economic briefing that the nation’s economy is projected to shrink by less than 3 percent this year, signaling a milder contraction than many earlier forecasts suggested.
GDP data now appear notably stronger than predictions made earlier in the year. He reminded listeners that some analysts had forecast declines running into double digits, underscoring a shift in the outlook. He noted that pessimistic views were off the mark and pointed to revised assessments from international institutions, including the IMF, World Bank, and OECD, which have adjusted their expectations upward. Preliminary estimates suggest the economy could end the year below a 3 percent decline, possibly even better. Still, he warned that a range of scenarios remains possible going forward.
In light of ongoing global tensions and sanctions, the government emphasizes vigilance and preparedness. He warned that the global crisis could worsen and that other factors, such as sanctions dynamics, must be monitored closely and addressed promptly. All plausible scenarios should be studied, and policy responses prepared. Of particular importance is the ongoing review of the balance of payments, the potential devaluation of the economy, and the expansion of international settlements settled in rubles.
When coordinating the budget and monetary policy, the government will rely on a new budget rule that allows approximately 8 trillion rubles in oil and gas revenues to finance expenditures over the next three years, the cabinet leader explained. He stressed the need for flexible and adaptive fiscal planning to weather shifting conditions and maintain steady support where needed.
There is also a need to prepare for possible changes in the labor market. Shortages in various sectors require concrete decisions to boost workforce availability and preserve market flexibility.
IMF forecast
In early October, the International Monetary Fund published a World Economic Outlook focusing on the cost of living and the global inflation challenge. The report portrays a somewhat improved outlook for Russia relative to earlier projections. The IMF expects a 3.4 percent GDP decline for 2022 (versus higher earlier forecasts) and projects a 2.3 percent contraction in 2023, not down to 3.5 percent as previously anticipated. The decline has been influenced by sanctions implemented after Russia’s actions in Ukraine. At the start of the year, the fund anticipated growth of about 2.8 percent in 2022 and 2.1 percent in 2023 for Russia, before the latest developments.
Ministry of Economic Development Forecast
The ministry had previously predicted a steeper drop but later revised its outlook. If April estimated an 8.8 percent fall for 2022, and May suggested 7.8 percent, the latest forecast expects a smaller contraction: about 2.9 percent in 2022, a near-stagnation of 0.8 percent in 2023, followed by growth of roughly 2.6 percent in 2024 and 2025.
Belousov’s prediction
Andrey Belousov, the first deputy prime minister, projects a 2.8 to 3 percent decline for the year and about 1 percent in 2024. He noted that consumer demand has already hit a trough, and investment activity is stabilizing, painting a comparatively steadier picture than many European economies.
Kudrin’s prediction
Alexei Kudrin, head of the Accounts Chamber, aligns closely with the government’s forecast. In a televised interview, he suggested a 2.9 to 3.3 percent decline for 2022 and called the current economic situation better than initially anticipated. He acknowledged that the sanctions regime has a meaningful impact but pointed out that several businesses have managed to adapt by pivoting to other markets or forming new partnerships.
Kudrin warned that GDP could shrink by about 0.8 percent more in 2023 and that more complex scenarios remain possible if restrictions on energy sales persist. He suggested a two- to three-year path to return to pre-crisis levels, unless new adverse events arise, highlighting the economy’s resilience but also the fragility of the external environment.