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Cabinet's estimate of the future of the Russian economy is moderately optimistic

May 17, 2013, 11:26 UTC+3

The Economic Development Ministry had drawn three scenarios of socio-economic development: conservative, moderately-optimistic and stimulated

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Economic Development Minister Andrei Belousov, during the government meeting on Thursday which addressed budget prognosis, said recession in the Russian economy had lasted for more than a year. However, he believes economic growth might begin in a month. After discussing the country's economic prospects, the Cabinet chose the moderately-optimistic scenario.

The pro-government Rossiiskaya Gazeta daily said the Economic Development Ministry had drawn three scenarios of socio-economic development: conservative, moderately-optimistic and stimulated. Separately, it calculated various options of the development of the situation in case of dramatic fluctuations of oil prices. The Cabinet believes the external trend for Russia would be more stable and favorable. "The world economy is expected to begin to gradually revive; with annual growth at some 4 percent, while the price of Urals will be around 100 dollars per barrel," Prime Minister Dmitry Medvedev said.

The GDP growth has been slowing down for five quarters in a row /to 1.1 percent in the 1st Q from almost 5 percent a year before/, the RBK Daily reports.

The state has decreased investments in the economy: last year they fell 8 percent in real terms and the same indicators are expected in 2013. State companies that account for 30 percent of all investments, decreased them by 10 percent in 2012 and a further 13-percent cut is expected this year.

But Economic Development Minister Andrei Belousov stated that the economy would begin to revive in the near future, the Komsomolskaya Pravda daily notes. "We're awaiting reversal of negative trends in the second quarter, whereas in the second half, economic growth will exceed 3 percent," the newspaper quoted him as saying.

The Kommersant daily writes that the minister is so optimistic because he is quitting his job soon. According to two independent government sources, Andrei Belousov has already written his resignation statement and will transfer to the post of presidential aide. He is replacing Elvira Nabiullina who will be Central Bank governor. The government has no information that the instruction on Belousov's appointment has been signed by President Vladimir Putin, who endorses all such reshuffles. Nor does the government have any ideas about Belousov's possible successor. The ministry might be reconfigured: in 2012, it lost much of its influence on the government compared with 2008-2011, the newspaper says.



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