MOSCOW: Russia’s economy ministry issued a dire forecast yesterday forecasting 16 years of negligible growth and global underperformance because of Kremlin’s failure to pursue reforms when oil prices were high.
Economy Minister Alexei Ulyukayev’s announcement came only two weeks after Russia reported a disappointing 1.2-percent third-quarter growth figure.
That outcome means that the economy will have a tough time expanding beyond two percent in 2013 — about half the rate of the United States. Russian President Vladimir Putin had hoped to see five-percent growth this year and reshuffled his economic team in the summer when that goal slipped out of reach. Ulyukayev cautioned that “the average rise in gross domestic product will range between 2.5 and 3.0 percent until 2025.” He said this will be followed by “a certain drop-off in the last five years” that will see the annual rate through 2030 reach 2.5 percent.
The economy ministry this spring had expected annual growth in the period to reach more than four percent. Ulyukayev also warned that Russia will now have a tough time fulfilling the massive spending promises that Putin made when he assumed his third term in the Kremlin in May 2012.
“The pace of Russia’s economic growth will fall behind the global average in the forecast period,” Ulyukayev observed. AFP
