EBRD official: Isolation from foreign debt markets good for Russia

MOSCOW, Nov 14 (PRIME) -- Isolation from foreign capital markets may help the Russian economy if the world suffers from economic recession, Sergei Guriyev, chief economist of the European Bank for Reconstruction and Development (EBRD), said late on November 11 at a meeting with students of the New Economic School.

“Russia has several factors of protection. First, it is isolation from the world capital markets. Russia will not have a so-called sudden stop that happened in 2008 when capital markets unexpectedly stopped to flow,” he said.

The world financial market is not expecting an economic crisis, but it did not expect any previous crises, he said.

But the sanctions and contraction of oil prices are not they key problems of the Russian economy. “Russia’s economy started to slow down even before 2014, this is why the fall of oil prices and introduction of sanctions are not the only problems of the Russian economy. While the absence of structural reforms, problems with the investment climate…are the most serious problems of the Russian economy,” he said.

“I think the government should engage in…inclusive institutions, and to increase attractiveness for businessmen and investors,” he said, adding that sanctions cost Russia about 0.5–1% of gross domestic product per year.

End