Gdp Growth Rate In 2015-2016: What Its Decomposition Speaks Of

The RF Ministry of Economic Development presented three scenarios in its socioeconomic development forecast for 2016, which envisaged that the GDP decline trajectory would hit its lowest point in 2015 (-3.9%), and the rate of GDP growth would be fluctuating somewhere between (-1.0) and +2.3% in 2016. A decomposition of the growth rate of GDP, with due regard for the projections of the movement of investment in fi xed assets, the number of employed in the economy and the expected level of the price of oil, demonstrates that this growth rate may be achieved either on condition of a dramatic acceleration of the cyclical component, or a revision of the existing projections of the cyclical component’s movement with a view towards growth of the total factor productivity in the economy. The input of the foreign trade component, which is linked to the movement of oil price, in the growth rate of GDP in all the scenarios is negative, because at present oil prices are below their multi -year average. All these development, irrespective of the roles played by each separate component in the behavior of GDP in 2016 and of the scenario under consideration, imply that both in 2015 and in 2016 the output gap in Russia’s economy will remain negative. In other words, in all the three scenarios the actual output index is expected to be below its potential value.