the Measures taken in response to the unprecedented shock of the pandemic, and extreme volatility in oil prices, will contribute to strengthening macroeconomic stability. In addition, the clear commitment to inflation targeting, flexible exchange rate and prudent fiscal policy supported increased resistance of Russia to shocks and reduce the impact of low oil prices on the economy, explains the Agency maintaining the stable Outlook.

Fitch forecasts that Russia’s GDP will shrink by 5.2% in 2020 due to the impact of the pandemic COVID-19 and the limitations of oil production under OPEC agreement+ (the last factor, according to the Agency, will cost the economy about one percentage point of GDP). Full recovery of the economy after the crisis, Fitch expects the 2022 (forecast for 2021 – GDP growth of 3.6% in 2022 and 2.5%). Overcoming the effects of the crisis, the rating agencies will maintain the monetary easing and the implementation of the economic recovery plan.

Fitch’s Decision is another indication that the architecture in the Russian macroeconomic structure maintains stability even in turbulent external environment, said Finance Minister Anton Siluanov (his words are in the message Department). “It is significant that the revision of the 2020 credit ratings of CIS countries by Fitch Ratings in most cases they took the decision to downgrade or deterioration in the forecast on it,” – said the Minister. He recalled that the government had taken “unprecedented measures to support citizens and companies in connection with the spread of the new coronavirus infection”, including due to the significantly increased volume of government borrowing.

“overall, the economy’s decline may not be as deep, the recovery more dynamic than in other countries”, – said the Minister. The budget will gradually be brought in line with the capacity of the economy, Siluanov said: “We will return to observance of the principles of budgetary policy, ensuring the stability of the economic and financial conditions in the country, designed to speed up private investment through the provision of sustainably low level of interest rates.” Starting in 2022, costs will be again limited by the budgetary rules. “This will allow us to maintain a high level of investor confidence in the ongoing macro-policy and to ensure the availability of financial resources for extra-budgetary sector”, – concluded Siluanov.

Fitch estimates the “cost” of anti-crisis measures in 2020 of 3% of GDP (more than three trillion rubles), and the budget deficit at 5.1% of GDP. Fitch forecasts that the liquid assets of the national welfare Fund will remain above 7% of GDP in 2020 (now 7.7%) and indicates that the government accounts have more money in comparable size – 6,6% Of GDP. In 2022, the budget deficit, according to analysts, will return to the target level of 0.5% of GDP due to the recovery of incomes and a gradual exit from stimulus.

Russia’s state Debt, according to Agency forecasts, will grow from 14.6 to 18.5% of GDP in 2020, but remain the lowest among countries with similar credit rating, and by 2022 Russia will be able to stabilize public debt at around 20% of GDP.