July 14, 2020

Russian economy shrinks 12 percent in April as coronavirus restrictions paralyzes business activities

The steep decline eliminated the modest economic growth seen during the first three months of 2020, when the Russian economy expanded by 1.6 percent compared to the same period last year, according to the Ministry of Economic Development.

Also on rt.com Most Russian companies face huge losses due to virus lockdown have difficulty getting government aid

Given the disappointing April results, the ministry now estimates that Russia’s GDP shrank by 1.9 percent over the first four months of this year.

The ministry explained that the negative growth came as non-essential businesses remained closed for the whole month and negative economic conditions prevailed worldwide.

Russia introduced coronavirus-related restrictions in late March and has prolonged the measures several times since then in order to battle the spread of infection. The paid non-working period ended on May 12.

Also on rt.com Covid-19 lockdown in Russia has bicycle sales soaring

Sectors of the economy focused on consumer demand suffered most. For example, consumer services fell by more than a third due to restrictions on leisure, culture and sporting activities, while retail sales dropped by a nearly a quarter. Although stores and food retailers remained open the whole time, their turnover also fell by 9.3 percent.

According to an earlier forecast, the second quarter could be the most painful for the Russian economy, as it is expected to shrink by more than nine percent. The nation’s annual GDP contraction is set to stand at five percent, while the country expects to return to pre-coronavirus levels no sooner than the first half of 2022.

For more stories on economy finance visit RT’s business section

Article source: https://www.rt.com/business/490090-russian-economy-contracts-april/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Speak Your Mind