Economic performance wasn’t too bad in 2021

RUSSIA ECONOMICS - In Brief 10 Feb 2022 by Alexander Kudrin

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Despite some noise about the vulnerability and the weakness of the Russian economy, which often appears in the media (especially at times of shocks), the country’s economic performance didn’t look bad either in 2020 or 2021. Having contracted by 2.7% in 2020, it looks as though economic growth was well over 4% last year. The Economics ministry estimated the 2021 GDP growth at 4.6%, which could be indeed the case. If so, then the initial pandemic shock was absorbed in 2020 quite smoothly, and last year the country’s GDP has well exceeded the pre-pandemic level.It is yet to be seen what will be the official print of the 2021 GDP growth from Rosstat (to be published on February 18) but the number could be around 4.5% easily – not least because, in the recent statistical publication showing December data (and respectively the full year), many previously published numbers were once again revised up. As a result, the 2H21 economic performance now looks better than it was seen a couple of months ago.For instance, the output of the five basic sectors (industry, agriculture, transport, construction, trade) reportedly grew by 6.2% in 2021. In 4Q21 and December, growth didn’t look bad either - 6.7%, and 5.9% y-o-y. These numbers look stronger than GDP growth as the latter incorporates some activities, that can't grow fast in principle – especially such activities as various social services, education, and some others.It was reported earlier that the Russian industrial output increased by 5.3% in 2021. In the publication yesterday, Rosstat reported about the same rate of growth in freight transportation, albeit in 4Q21, it slowed to 4.1% y-o-y. Agricultural output contracted by 0....