Russia reduced its forecast for economic growth this year, as investment will be weaker than initially estimated, Economic Development Minister Elvira Nabiullina said.
Gross domestic product will probably expand 3.4 percent this year, less than the previous forecast of 3.7 percent, Nabiullina said Friday, according to a transcript of her speech e-mailed by the ministry. Investment will advance 6.6 percent, down from the earlier prediction for 7.8 percent.
Rising oil prices are no longer stoking the economy after helping the world's largest energy exporter grow faster than estimated last year, when GDP expanded 4.3 percent and returned to output levels last reached before a 7.8 percent contraction in 2009. Russia increased its forecast for Urals crude, the country's main export earner, to average $115 a barrel this year from $100, Nabiullina said.
"Many large companies invested more than they had planned last year," Nabiullina said. "The high base level for last year led to a lower forecast for investment growth this year to 6.6 percent from 7.8 percent in the previous forecast. That's one of the main reasons why we cut our GDP forecast."
The ministry boosted its retail sales forecast for 2012 to 6.3 percent, from 5.5 percent, Nabiullina said. Real wages growth was also revised upward to 6.3 percent from 4.9 percent.
The euro area's sovereign-debt crisis remains the "key risk" to global economic growth, she said. The Economic Development Ministry's baseline scenario is for a "relatively positive" resolution to Europe's credit crunch, Nabiullina said.
A Message from The Moscow Times:
Dear readers,
We are facing unprecedented challenges. Russia's Prosecutor General's Office has designated The Moscow Times as an "undesirable" organization, criminalizing our work and putting our staff at risk of prosecution. This follows our earlier unjust labeling as a "foreign agent."
These actions are direct attempts to silence independent journalism in Russia. The authorities claim our work "discredits the decisions of the Russian leadership." We see things differently: we strive to provide accurate, unbiased reporting on Russia.
We, the journalists of The Moscow Times, refuse to be silenced. But to continue our work, we need your help.
Your support, no matter how small, makes a world of difference. If you can, please support us monthly starting from just $2. It's quick to set up, and every contribution makes a significant impact.
By supporting The Moscow Times, you're defending open, independent journalism in the face of repression. Thank you for standing with us.
Remind me later.
