Kudrin: Russia to see full-fledged economic crisis in 2015

Russia will enter a full-fledged economic crisis situation in 2015, with GDP shrinking even if oil rises to $80 per barrel, Civil Initiatives Committee Chairman Alexei Kudrin said.

Russia will enter a full-fledged economic crisis situation in 2015, with GDP shrinking even if oil rises to $80 per barrel, Civil Initiatives Committee Chairman Alexei Kudrin said.

"I can say today that we have entered or are entering a genuine, full-fledged economic crisis. We will feel it in full measure next year," Kudrin said at a press conference at Interfax's central office on Monday.

If oil prices rise to $80 per barrel, the economic contraction will "amount to 2 percent or more." If oil prices remain at the $60 level, "GDP will decline 4 percent or more," Kudrin said.

The Russian government's anti-crisis measures won't have the desired effect as long as the standoff with the West continues, he told.

"It is crucial to resolve relations [with western partners]. If the conflict that is dangerous from the point of view of sanctions being stepped up continues to smolder, it will reduce the effectiveness of any other anti-crisis measures, and we will not be able to realize the potential of these anti-crisis measures [in that event], Kudrin said.

He said that other BRICS countries "ensured their sovereignty while continuing to participate in global economic, trade and financial relations." "The desire to preserve Russia's sovereignty is not at odds with the opportunity to preserve Russia as a dependable business partner," Kudrin said.

He said the Russian economy faces a stern test next year.

"Russia will receive a rating downgrade, it will be classed as junk. Given the volume of obligations which has amassed both in dollars and ruble terms and by virtue of a break down in the economy's functioning and mutual non-payments, and marked deterioration in payments discipline, this will result in us seeing a whole sequence of defaults by medium and large enterprises," Kudrin said.

All rights reserved by Rossiyskaya Gazeta.

More exciting stories and videos on Russia Beyond's Facebook page

This website uses cookies. Click here to find out more.

Accept cookies