Economist Khestanov: the recovery growth of the Russian economy has exhausted itself by the fall of 2021 , therefore, the slowdown that is observed now is logical and predictable, said the economist, macroeconomic advisor to the general director of Otkritie Investments, Sergei Khestanov. In a conversation with Lenta.ru, he added that for developing countries, growth below 3 percent is perceived as stagnation.
The World Bank has lowered its forecasts for the growth of the Russian economy to 2.4 percent. This is due to possible new restrictions due to the coronavirus pandemic.
Expected stagnation
Khestanov recalled that economic growth in Russia has been consistently declining since 2012, but a noticeable drop in 2020 associated with the coronavirus pandemic gave the effect of a sharp jump associated with an initially low base.
“Since growth is measured over a year, then relative to 2020 in 2021, the Russian economy, indeed, has grown strongly. But in 2022, the countdown will start from the results of 2021, which will lead to a slowdown in growth. Active recovery growth has exhausted itself already by the fall of 2021. Gradually, growth rates are approaching the potential, which now amount to about 2 percent a year, “the economist explained.
He noted that, at least any economic growth is better than its decline, for developing countries, growth below 3 percent is subjectively perceived as stagnation. However, according to the expert, at this stage of recovery from the pandemic, the problem of low rates is rather secondary.
“Now it is more important to fight the pandemic and protect against external shocks, such as surges in commodity prices, possible sanctions. As these tasks are solved, it will come to accelerating economic growth, “Khestanov concluded.
In October, the Danish bank Saxo Bank said that Russia is dangerously close to stagflation – a situation when an economic downturn is combined with inflation. According to analysts of the credit institution, an increase in budget spending aimed at supporting the poorest part of the population and investments in infrastructure may improve the trends.