Sanctions likely to result in 10% decline this year, Alexey Kudrin says
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The Russian economy could contract by more than 10% in 2022 due to Western sanctions, the head of the Accounts Chamber and former finance minister Alexey Kudrin said on Tuesday, as cited by TASS.
This is the official scenario that is currently being worked out at the level of the Ministry of Economic Development and the Ministry of Finance, he said, at a meeting of the Federation Council Committee on Budget and Financial Markets.
“Certainly, [GDP] will decrease. The official forecast would be for more than around a 10% decline,” said Kudrin, who served as Putin’s finance minister from 2000 to 2011.
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Previous Russian government forecasts estimated GDP growth of 3% this year after the economy expanded by 4.7% in 2021. A contraction of 10% would amount to the biggest decline in gross domestic product since 1994, according to World Bank and International Monetary Fund data. This month, the World Bank projected Russian GDP output would fall 11.2% in 2022.
The Kremlin said recently that the Russian economy is currently facing its most challenging situation in three decades, but the West will not succeed in its attempts to isolate the country. Prime Minister Mikhail Mishustin told the State Duma last week that Russia will need at least six months to rebuild its economy from the impact of the Western sanctions.
On Monday, President Putin outlined priorities to restart the nation’s economy. The suggested measures focus on support for social programs and for businesses.
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