The Russian economy continued to fall for the seventh quarter in a row

Russia’s GDP in the third quarter of 2016 decreased by 0.4% compared to the same period last year, according to the help on the preliminary estimate of GDP dynamics on Monday, November 14, published by Rosstat.

Thus, the fall of the Russian economy continues for the seventh consecutive quarter (year-on-year). It slowed to a minimum during this period. The most significant decline was observed in the second quarter of 2015 (4.5%). In the second quarter of 2016, the GDP decreased by 0.6%.

Rosstat does not publish data on the change of GDP compared to the previous quarter, adjusted for seasonality. According to Ministry estimates, GDP in the third quarter grew by 0.1-0.2% in the second quarter with the elimination of seasonal factors, said the Director of the consolidated Department of macroeconomic forecasting of Ministry of economic development Kirill Tremasov, reported “RIA Novosti”. Overall in 2016, the GDP is expected to the Ministry, may be 0.6%.

Vnesheconombank also has recorded quarterly growth of GDP, but by only 0.1%. A slight increase was also noticed by the Central Bank.

The authorities expect the beginning of growth of the economy in 2017. The Ministry of economic development in the baseline forecast expects an increase of 0.6%, in 2018 it is expected to be 1.7%, and in 2019 is 2.1%. According to the forecast of the Central Bank, GDP growth next year will amount to 0.5—1% in 2018 and 2019 — on 1,5—2%.

Optimistic on prospects of the Russian economy in 2017 looks European Bank for reconstruction and development (EBRD). According to his forecast, the GDP in 2017 will grow by 1.2% (in 2016 assessment year, his expectations coincide with the forecast of Ministry of economic development). But without “substantial reform”, warns the EBRD, growth will remain low — only 1-2% per year, the reasons for this low investment and the obsolescence of production capacities.