OREANDA-NEWSThe World Bank's forecast for Russia's GDP growth in 2019 has been reduced from 1.5% to 1.4% compared with January. This is stated in the report issued by the organization "World Bank: Economic Report on the Region of Europe and Central Asia - April 2019". At the same time, the forecast for GDP growth in the Russian Federation in 2020–2021 is kept at 1.8%.

"Russia has modest prospects for economic growth in 2019-2021," the World Bank experts write in the report. At the same time, the preservation of the federal budget surplus in the Russian Federation will be maintained at the expense of relatively high oil prices in 2019-2021, experts say. The World Bank also predicts the acceleration of inflation in 2019 against the background of the increase in the VAT rate and the depreciation of the ruble. However, a return to the Central Bank target of 4% is possible already in 2020-2021, they believe.

"The external surplus forecast reflects a decline in oil prices and an increase in import costs. Stable economic growth, private sector wage growth and indexation of pensions to inflation will support real incomes of the population, and also contribute to a gradual decrease in the level of poverty in 2019-2021 “However, many Russians do not have official work, and many households will remain close to the poverty line,” the report says.

According to the World Bank report, the risks of lower growth in the Russian economy are associated with a potential expansion of sanctions, deterioration of sentiment in financial markets and a sharp drop in oil prices.

In January, the International Monetary Fund (IMF) downgraded the forecast for Russia's GDP growth to 1.6% in 2019 and to 1.7% in 2020. At the same time, in the October version of the forecast, an increase of 1.8% in 2019 and 2020 was mentioned.