OREANDA-NEWS.The annual negative effect of sanctions on Russian GDP growth from 2014 to 2018 averaged 0.2 percentage points. This conclusion was reached by experts of the International Monetary Fund (IMF) in the annual report on the Russian economy, published on the organization’s website.

The negative effect of the fall in oil prices averaged about 0.65 percentage points. Tight fiscal policy (minus 0.1 percentage points) and Russia's restraining monetary policy (minus 0.2 percentage points) had a lesser impact on GDP growth. Together, all these factors - sanctions, oil, fiscal and monetary policies took away nearly 1.2 percentage points from the annual growth of the Russian economy, according to the IMF.

As noted in the report, in 2014–2018, Russia's annual GDP growth averaged 0.5%. And if all of the above factors were not there, the average annual growth could reach 1.7%. “Sanctions, an unexpected drop in oil prices, and the reaction of financial markets and economic policies to a double shock contributed to lower than expected growth since 2014”, the document says.

Thus, over five years, the Russian economy grew by only 2.5%, follows from the IMF estimates, and could theoretically grow by 5.9% in the absence of external shocks. If sanctions were removed and all other factors left, the economy would have grown by 3.5% in five years.

During the sanctions against Russia, economists have made more than one attempt to assess their effect on the Russian economy, but all measures have only limited application. The only consensus is that the drop in oil prices seems to have had a greater effect than the sanctions. In 2018, GDP growth in Russia amounted to 2.3%. In 2019, the Ministry of Economic Development expects it to slow down to 1.3%, and in 2020 it will accelerate to 2%.