ALEXANDER DERYUGIN OFFERS HIS FORECAST OF THE CONSEQUENCES OF THE THIRD COVID-19 WAVE FOR THE RUSSIAN ECONOMY

The Russian economy may suffer from a third wave of the pandemic, as the media have prophesized. The validity of such fears was discussed on the air with Sputnik radio program by Alexander Deryugin, researcher at the Gaidar Institute’s Budget Policy Department.

The third wave of COVID-19 infection in Russia and the resulting restrictions on the operation of businesses imposed by the regions will translate into losses for the Russian economy worth 0.1-0.2% of GDP, as was predicted earlier for 2021, according to the experts interviewed by RBC. The source further specifies that overall, Russia’s GDP growth this year is expected to be at the level of 3.7-4%.

“We could see that last year’s restrictions on economic activity delivered a heavy blow to the economy, we saw a significant revenue shrinkage, including regional budget revenues. The second wave that came in the autumn had practically no effect on the economy or the budgets of the regions. The economy adapted to the second wave. The absence of lockdowns and tough restrictions helped avoid a decline in economic indicators at the peak of that wave. We are witnessing the same situation at present. If there are no strict containment measures, I do not think that we will see a deterioration in economic performance,” said Alexander Deryugin.

The expert does not deny the fact that the pandemic has continued to produce negative effects for the economy, but believes that businesses will adapt to the new conditions.

“If the pandemic were defeated worldwide, or the infection just disappeared somehow, things would have become better across all sectors of the economy - except, perhaps, the sales of medicines. The impact of the continuing pandemic is definitely negative, but nevertheless, the whole world has seen positive growth rates in economic indicators due to the rebound effect, and also because during the second and third waves that were tougher than the first one, the economy managed to adapt,” explained Alexander Deryugin.