REUTERS
The United Nations (UN) has sharply lowered its forecast of Russia's GDP in 2015, Russian news agency TASS has reported, referring to a report from the UN Department of Economic and Social Affairs.
In December, experts of the world organization projected the growth of the Russian economy by 0.2%, but now they expect it will drop by 3%. In addition, the organization has worsened its forecast for 2016: The Russian economy is projected to stagnate, against previously anticipated growth of 1.2%.
Russian economic prospects have turned out to be worse than in other CIS countries. In 2015, their economies are predicted to drop by 2.1% and in 2016 – see an increase of 0.9%.
Expert of the Department of Economic and Social Affairs Grigor Aghabekyan explained that the revision of the forecast for the Russian economy was determined by a decline in oil prices, rather than international sanctions. In the last report of UN experts, the average oil price used as the basis when forecast preparation amounted to $90 per barrel [Brent barrel is now traded at around $65 – Ed.].
Aghabekyan has also stated that the UN expects the average price of oil at $60 in 2015 and $70 - in 2016. The expert noted that in the current circumstances Russia is advised to reduce its dependence on external factors, diversify the economy and improve the investment climate.
At the same time, the expert pointed out that the most negative scenarios of the Russian economy have not proved true.
In the first quarter 2015, Russia's GDP fell by 1.9%. According to the Economic Development Ministry, the Russian economy is projected to shrink by 3% in 2015. The Accounts Chamber projects that the economic downturn will be significantly deeper, similar to the crisis of 2008-2009 when GDP fell by 7.8%.
The IMF forecasts that the Russian economy will decline by 3.8% this year, while Bank Morgan Stanley expects GDP decline of 5%.