Economic activity begins to decline in Russia
The main factors behind the decline in Russia’s GDP are transport and logistics restrictions and reduced domestic demand.
At the end of May, the Russian economy shrank by 4.3% year-on-year after falling by 2.8% in April. On Thursday, June 30, reports Interfax with reference to the data of the Ministry of Economic Development of the Russian Federation.
At the same time, in January the growth of the Russian economy amounted to 5.7%, in February – 4.1%, in March – 1.3%. According to the results of January-May 2022, the department estimates GDP growth at the level of 0.5% year-on-year.
“The main factors behind the decline in GDP are still transport and logistics restrictions and reduced domestic demand,” the ministry said in a report.
Of the basic sectors of the economy, the decline in wholesale trade accelerated (minus 15.5% y/y in May after minus 11.9% y/y a month earlier).
“In construction and agriculture, growth slowed down, but maintained a positive trend,” the ministry said.
In April, real wages fell by 7.2% y/y (after rising by 3.6% y/y in March).
At the same time, the official forecast of the Ministry of Economic Development of the Russian Federation (from mid-May) for a decrease in Russia’s GDP in 2022 is 7.8%. But the ministry said the estimate could be revised downwards.
Earlier it was reported that by the end of 2022, the Russian economy will shrink by 15% and by another 3% in 2023. This will negate the 15-year economic growth of the country.