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Russia's economic growth rate never to be as before — minister

December 18, 2014, 9:46 UTC+3 MOSCOW

Russian Economic Development minister says Russia could have enjoyed economic growth of 2.5-3% if it in a sense hadn't prepared a 'perfect storm' it's in now

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MOSCOW, December 18. /TASS/. Minister of Economic Development Aleksey Ulyukayev believes that Russian economy has been trapped in ‘a perfect storm’ and will not grow at the previous pace any longer. He said so in an interview with the Vedomosti daily published on Thursday.

“Global economic growth rates will be much lower than before. So, Russian economic growth rates will never be as before, as I refer to the level when there is no negative difference between potential and actual output. From my viewpoint, this is about 2.5-3% growth. So, if there had been neither sanctions nor oil price fall and if we had had made no follies, the economic growth would have been 2.5-3%. This is going to be the new normal level for a long time and forever for my generation. I do not see another normal rate. Perhaps, you will see it,” Ulyukayev said.

“Probably we have got in a perfect storm and perhaps this is not accidental. Because we have prepared this storm overselves in some sense. As for the structural crisis, it is a result of under-reformed economy and all that we have not done. We did not reduce macroeconomic costs, that is to say costs in pension system and social sphere which now means additional liabilities over social insurance fund and medical insurance,” Ulyukayev noted.

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