The world Bank expects the economy to shrink Russia to 11-year low

Russia’s GDP in 2020 will decrease by 6% to an 11-year low, according to a forecast by the world Bank. This baseline scenario coincides with the forecast Bank of Russia (a decrease by 4-6%), as forecast by the international rating Agency Fitch, and many other economic organizations. But the Ministry of economic development of the Russian economy in 2020 will decline only by 4.8%.

Under the stress scenario, the world Bank, the Russian economy will shrink stronger. “A more adverse scenario, GDP could shrink by 9.6% in 2020, and recover at a negligible 0.1 percent in 2021,” reads the forecast.

Declared by the Russian government measures may partially contain the crisis caused by the growth of poverty, said the world Bank. If there will be a second significant wave of the pandemic, Russia’s GDP is expected to grow to 2021 2.7% 2022 and later in the year, growth will accelerate to 3.1%.

the world Bank, like other international economic organizations, said that all the predictions this year are exposed to “unprecedented levels of uncertainty and assumptions”.

“Pandemic COVID-19 was a powerful shock to the international community and led to a sharp decline in the economy of many countries. Under the baseline forecast, in 2020 the expected reduction of world GDP at 5.2 percent — the decline in the world economy will be most profound in a decade”, — the report of the world Bank. This recession will be the deepest since the Second world war, and the decline in production per capita will reach the greatest percentage of countries since 1870.

the Russian government is preparing amendments to the Budget code to be included in the expenditure budget, the national economic recovery plan worth more than 5 trillion rubles. The government will double the loans in the domestic market for the economic recovery and increase spending.

Aboutbinationally the economic recovery plan focused on GDP growth not less than 2.5% by the end of 2021, the reduction of unemployment to 5% and the increase in real incomes.

Before the pandemic Russian budget-2020 was approved with revenues 20,38 trillion rubles, expenditures of 19.5 trillion rubles. A budget surplus in 2020 is planned at the level of 876 billion rubles. While GDP was to be 112,863 trillion rubles, inflation of 3%.