Experts said that the only alternative to structural reforms in Russia


Russia’s economy can grow more than 2% only in one case — if oil prices will increase annually and will reach us $100 per barrel. Such conclusion contains in the macroeconomic forecast for 2017-2018 prepared by the experts of the Ranepa, the Gaidar Institute and Academy of foreign trade under Ministry of economic development.

Expensive oil is also the only way to accelerate the growth of investment in fixed capital and population incomes, according to the report. Rosstat has not yet published statistics on these indicators for 2016, however, the assessment of the budget forecast investments will drop by 3.7% in comparison with January—December 2015, and real incomes by 5.6%.

However, the scenario with oil at $100, according to the forecast of the Ranepa, “it is unlikely in the medium term”. But even if the prices are so much will grow “dramatically increase the risk of a new downturn in the economy with the stabilization of oil prices and the postponement of reforms for the future”. The world Bank and major Western banks in their reviews though, and agree that Russia’s GDP will begin to grow, but “don’t assume in the next year or two no serious structural and institutional reforms, significantly affect the dynamics of economic growth,” specifies the Ranepa. “If the price of oil will go for $60, then Yes, I think this is again all mellow. To $60 not relax, because it is still the growth rate will be low”, — said at the Gaidar forum last Chairman of the Board of the Center for strategic development Alexey Kudrin (it was the CSR prepares a country development strategy 2018-2024 years, it is planned to submit in may).

Russia’s economy has passed the bottom, stated Ranepa experts in its last report, which was released in October. In General, they consider two typical scenarios, a conservative and basic: the first assumes oil at $40 for two years, the second — $50 in 2017 and $60 in 2018. the average oil price in 2017 will be $50-60, said earlier the Minister of energy Alexander Novak.

In the conservative version of the Ranepa, as the authors of the budget forecast envisages GDP growth of only 0.6 and 1.7% respectively in the next two years (to coincide with the budget forecast). However, first Deputy Prime Minister Igor Shuvalov at Davos forum last week said that the authorities expect growth of 1-2%, and the Minister of economic development Maxim Oreshkin explained that this increase will be possible at the current oil prices and the absence of new external shocks.

These estimates are close to the forecast of the Ranepa under the baseline scenario, according to which this year’s GDP will increase by 1.4%, and a year later — by 2.2%. Russia’s economy will face a “boring” recovery, said in his forecast on January 20, the analysts of “Renaissance Capital”. According to the forecast of the Ranepa, similar to the GDP dynamics will change most of the other key macroeconomic indicators. In the baseline scenario, investment in the next two years will grow by 1.8 and 2.5% respectively, has a turnover of 0.3 and 1.5%, incomes — by 1.5 and 2.7%. Growth of key indicators is provided and in a conservative scenario, albeit at a slower (with the exception of retail trade turnover, which, according to the authors, will decline by 0.1% in 2017).

As for inflation, the prospects for its reduction to 4% in 2017 (it is such target plans to achieve CB) “while ambiguous,” reads the forecast. The price increase could accelerate the recovery of aggregate demand and soft budget policy. Ranepa experts fear that the increased spending will result in an increase in revenues from oil, “especially given the current phase of the political cycle” (will host the 2018 presidential elections). The Minister of Finance Anton Siluanov declared earlier that the government made a decision about the direction of the oil windfall in the reserves and failure to increase spending.

Source