Interfax: Klepach: Any new shocks to global economy could reduce Russian GDP growth to zero

ASTANA. May 23 (Interfax) – Any new shocks to the global economy have the potential to reduce Russian GDP growth in 2014 to zero, Deputy Economic Development Minister Andrei Klepach said.

“If any shocks in the global economy occur, such as a drop in oil prices or further aggrava tion of the geopolitical situation, GDP could of course be near zero or even lower,” Klepach told journalists on the sidelines of the Astana Economic Forum Friday.

“But I think that growth will, quite probably, be about 0.5%, as indicated in the official government forecast, maybe even a little higher. There is potential for growth, despite the losses, despite the capital outflow,” he said.

Asked about the size of the capital outflow, Klepach said that his ministry forecasts that capital outflow for the full year will total about $90 billion. Roughly $50 billion is already gone and another $40 billion might flow out before year-end, he said.

“I am not prepared to say right now how much in April; the outflow is continuing. Fifty in the first quarter,” he said.

As for the decision not to borrow on foreign markets this year and not to place obligations, he said: “Right now and overall, the state and companies have decided against borrowing on the global market since the terms are unfavorable. But that does not mean that we cannot return to the global market, all the more so that the global market is varied: there is the perhaps restricted, but definite potential for borrowing on Asian exchanges and in China.”

Asked when Russia might return to the external borrowing market, Klepach said: “I am not prepared to say right now. That depends on many factors, but it will happen.”

However, he added, it will not happen this year.

[featured image is file photo]