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Economic Development Ministry forecasts further stagnation in Russia

However, in October, Russia’s economy demonstrated slight improvements

© EPA/YURI KOCHETKOV

BALI (Indonesia), December 03. /ITAR-TASS/. Russia’s GDP growth will reach 1.8% in November and 1.6-1.7% in the fourth quarter of the year, Economic Development Minister Alexei Ulyukayev told reporters on Tuesday.

The Economic Development Ministry lowered its 2013 forecast for the GDP growth. “This is a purely counting position,” Ulyukayev said, explaining why the ministry had reconsidered the forecast.

In October Russia’s economy demonstrated slight improvements, he said.

“We hope that we will have some better figures for November than before. In October the GDP growth reached 1.8% year-on-year,” Ulyukayev said. “We expect practically the same figure in November. As a result, in the fourth quarter we will, probably, have 1.6-1.7%. In general, we will have the growth of 1.4% this year. The probability of having 1.5% is slight.”

The GDP growth would be affected by a decline in capital investment, he said. Moreover, by the end of the year there will be symmetrical reduction of real wages and retail sales volume. “We register such GDP dynamics over reduction in consumer and investment demand,” Ulyukayev said.

The minister said he expected further stagnation in 2014. “Undoubtedly, stagnation will continue, although there are some recovery moments. Thus, we have some recovery in industrial production and in the GDP rates in October-November. But in general stagnation will continue,” he said without making forecasts for how long stagnation could last.

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