Official: Russia’s GDP may fall 0.6–0.7% in 2016, grow 1% in 2017

SINGAPORE, Nov 25 (PRIME) -- Russia’s gross domestic product (GDP) may fall by 0.6–0.7% in 2016, but is expected to grow 1% in 2017, First Deputy Prime Minister Igor Shuvalov said at a forum Friday.

“We will most likely finish this year with negative growth of 0.6–0.7%,” he said.

“We are already recording growth, although it is slow. The Russian economy is growing month after month, we hope that it will grow by 1% or more next year, which is not enough for the Russian economy, but is at least positive growth, not the absence of it,” Shuvalov said.

Russia’s financial and banking sectors are becoming stronger and more stable, Shuvalov also said.

The population’s incomes have stopped falling and are expected to grow in 2017, he also said.

“The population’s incomes are not growing as much as we would like. But we note that at some groups of the population real incomes are still growing a bit. The decrease of incomes is over. We hope that it will be a trend for all groups of the population next year, that incomes will be growing. And consumer demand is also expected to revive next year, now consumers are quite cautious,” Shuvalov said.

He also said he believed the government should allocate revenues from the commodities sector not for budget spending, but to replenish reserves.

“The future of the Russian economy is certainly not commodities. The raw materials sector will continue developing, and this is right. But money from the commodities sector should not be allocated for budget expenditures, it is necessary to keep these funds, which the government will receive in the form of taxes, for future generations,” Shuvalov said.

“We have reserve funds, and we should replenish these funds with this money. And learn to live and spend what other sectors are giving,” he said.

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