On Evaluation of Russia’s GDP in 2013

On November 13, 2013, Alexei Ulyukaev, the Minister of Economic Development of the Russian Federation said that in 2013 GDP growth may happen to be below the forecasted 1.8%. Alexei Ulyukaev did not rule out that on the basis of the results of the year economic growth would amount to 1.5%-1.6%.

Earlier that week, the European Bank for Reconstruction and Development revised downward the forecast on Russia's GDP growth to 1.3% in 2013.

It is to be noted that the macroeconomic situation in the current year is characterized by gradual weakening of the economic dynamics and worsening of growth prospects in the remaining two months of 2013. Stagnation of the Russian economy is justified by the effect of both internal and external factors. The domestic market is affected by a drop in output volumes of goods and services for domestic consumption, as well as a slowdown of rates of import supplies. So, the index of industrial production in that period to January-September 2012 amounted to 100.1%. It is to be noted that in the past five months of 2013 in the manufacturing industry which is aimed primarily at the domestic market negative annual and quarterly growth rates as compared to respective periods of the previous year were registered.


A slump in the manufacturing industry in January-September and September amounted to 0.3% and 0.7% on respective period of 2012, respectively. From the 2nd quarter of 2013, industrial dynamics was influenced by weak growth in production of primary products which situation is justified to a great extent by growth in fuel reserves on the domestic market, as well as in traditional importer-countries on the eve of the beginning of the heating season with unfavorable climate forecasts made for the 2013-2014 winter.


Further drop in investment activities in 2013 had a rather negative effect on economic processes. In January-September, in the building sector the volume of jobs decreased by 1.1% as compared to the respective index of the previous year. In the 3rd quarter, a drop in investments in capital assets amounted to 1.2%, while generally in January-September 2013 a reduction was equal to 1.9% as compared to the respective period of 2012.

A decrease in financial results of enterprises and entities intensified limitations on financing of investments into capital assets. In January-August 2013, the consolidated financial result as regards the economy in general amounted to 82.1% of the index of the respective period of 2012, including in production of primary products - 97.0%, manufacturing industry- 70.5%, production and distribution of power, gas and water - 85.3% and transport - 86,8%. With the existing dynamics of the results of financial activities and scaling-down of investment programs at large companies, an upturn in investment activities can hardly be expected in the last quarter of 2013.


О.I. Izryadnova, Head of the Structural Policy Department