Russia’s economic development minister Maksim Oreshkin has said his ministry maintains its GDP growth outlook for 2019 at 1.3%, RBC reports.
“So far yes,” he said when asked whether the ministry considers the GDP growth outlook for this year of 1.3% still relevant.
“The data for the first quarter is preliminary and may change in both directions. We projected a weak dynamics (for Q1),” he said.
Oreshkin’s statement comes after official data showed that GDP growth slowed from 2.7% year on year in 4Q18 to just 0.5% y/y in 1Q19. The result led some experts to warn of a new economic crisis developing in the country.
Oreshkin added that he does not expect a recession in the Russian economy in the second half of 2019. “I believe that was the tax and budget factor, which played an important negative role in the first quarter,” the minister said.
He believes that the recent low growth figure is a consequence of the influence of the fiscal factor. “In the main part of the year, he will already act in the other direction,” Oreshkin said.
The ministry explained the slowdown in the first quarter with low demand against the background of the increase in VAT rate to 20%, as well as a decrease in the trade turnover. Another factor is the low growth rate of the corporate loan portfolio and the slowdown in mortgage lending.