There are several options for implementing the forecast of the Ministry of Economic Development of the Russian Federation on GDP growth. The main thing is the creation of favorable conditions for business, I told FBA “economy today” leading expert of the Center for Political Technologies, PhD in Economics Nikita Maslennikov.
The Ministry of Economic Development of the Russian Federation has updated its macro forecast, which suggests, that in about two years Russia will oust Germany from the top five economies in the world. Wherein, in 2021 GDP will grow by 3,1%, and the next increase will be 3,3% annually.
“The Ministry of Economic Development presented a rather optimistic assessment. for example, forecast for 2020 year with GDP growth of 1,9% also quite interesting and raises questions. The logic of these issues can be traced from year to year - this is a function of the content of economic policy. There are usually two kinds of circumstances, affecting the state of the economy: limiting or stimulating macrodynamics, as well as economic and political issues, based on a combination of all factors, – the economist commented on the forecast.
Basics for the forecast: What is the state of the Russian economy
This year, Nikita Maslennikov believes, provided the expert community with a clear, but at the same time suggestive of some risks. The country's economy slowed down noticeably.
“According to last year’s data, workforce has been cut by almost 1%, it takes off about 0,2% from a percentage point, specified in the forecast of the Ministry of Economic Development. Estimated effect, marked by the ministry, suggests 0,3%. Besides, demographics and global trade volumes have declined. However, the deduction will compensate for the measures, voiced by the President of the Russian Federation in the Address to the Federal Assembly", - said the expert.
But the positive impact of the measures listed by the head of state is not enough to, to reach the numbers, indicated in the department's forecast.
“Now a natural question arises – due to what the economy will grow? Last year, the contribution of net exports to GDP was negative. I guess, that this year the situation will repeat itself, since there is no reason to expect a sharp breakthrough. This is due to the fact, that the main export markets are in a rather volatile state. The situation may worsen due to the implementation of forecasts for a decline in China's GDP to 4-5% by the end 2020 of the year. Such changes will cause the world economy to lose about 0.1-0.2%”, - said Nikita Maslennikov.
Confirm the decline and forecasts for oil for 2020 year, He emphasizes the expert. for example, average annual price, which was recorded in 2019 year, amounted to over $63 per barrel, and 2020 analysts expect a decline to $57,7.
Recall, in 2019, according to Rosstat, the Russian economy added 1,3%. Compared to numbers 2018 of the year, when the value reached 2,5%, the result is modest. Indicators at a similar level, adds expert, observed for seven years in a row. They can also be classified as average, because according to the International Monetary Fund, in 2019, global GDP grew by 2,9%.
National projects will help speed up the economy
Representatives of the Ministry of Finance of the Russian Federation stated, that the goals announced by President Vladimir Putin will require up to 2024 of the year 4,1 trillion rubles additionally. A rapid launch of national projects, consider already in the Ministry of Economic Development of the country, will allow the economy to gradually reach the GDP values indicated in the forecast.
“Only internal factors remain to fulfill the forecast of the Ministry of Finance. National projects also matter, and consumer demand. The latter will be supported by socio-political measures, listed by the President. the, that they won't let demand drop any further - obviously. And here, How much will they raise it?, hard to say.
Last year, consumer demand changed due to credit retail. If it shrinks this year, then this will not provide too strong support to demand. Suspicions creep in, that measures of socio-political support may also not be enough, so you have to rely, that the dynamics of real incomes will repeat the picture of the current year. Let's hope so, that national projects will have a proper positive impact on GDP growth”, – Maslennikov shared his thoughts.
Investment activity will ensure GDP growth
If national projects, how the new government of the Russian Federation expects, "shoot", then the number of investment influences will increase, which, in its turn, stimulate consumer demand.
“The most important thing in this regard is the “motor” of investments. If he doesn't start, then the contribution of national projects can be expected at the level 0,2-0,4%. If it starts, then growth will reach approximately 2,5%. But so far it is not entirely clear, how the Ministry of Economic Development intends to make investment activity work for the benefit of the economy”, - said the expert.
First of all, believes Nikita Maslennikov, the authorities need to update national projects and state programs by the end of February 2020 of the year, as stated. A clear amount of funding for the entire package of socio-political measures should also be indicated, identifying sources.
"Since last year, the balance has moved more 1 trillion rubles, which will allow you to easily finance everything in 2020 year. But where to take the funds further is not known. All amendments, concerning business and its participation in investment, must be taken before 13 April. The most significant moment is the execution of the instructions of the President until 30 April on the approval of a package of laws, regulating the conclusion of agreements on the promotion and protection of investments. There are a lot of unanswered questions here..
The sum of the added three terms will allow us to honestly say, is it possible to disperse the GDP to 3,1% or not. Today, one can only positively assess the macroeconomic forecast of the Ministry of Economic Development. But it’s important to understand, that its implementation is possible only if favorable conditions for business are created, which in response will begin to invest in the economy at a rate, five times faster than 2019 of the year", Maslennikov summed up.
Alexander Melnik
