MINSK, 12 December (BelTA) - The pace of economic activity in the Commonwealth of Independent States (CIS) is accelerating, reads a report released by the UN Department of Economic and Social Affairs on 11 December, BelTA informs.
The document points to the intensification of economic activity in the CIS area, marked by the return to growth in Russia. Economic activity has improved in Kazakhstan, Armenia, Kyrgyzstan and Uzbekistan, Belarus has also exited recession.
“Improved terms of trade, a more supportive external environment and less volatile macroeconomic conditions have contributed to a more favorable economic climate for the region. Following a near stagnation in growth in 2016, regional GDP is expected to have rebounded to 2.2% in 2017,” the press release says. Growth is projected to accelerate to around 2.3% and 2.4% in 2018 and 2019, respectively.
The Central Asian economies are expected to expand faster than other CIS economies, benefiting from stronger remittance inflows, the implementation of the Belt and Road initiative, and, in some cases, fiscal spending on development. However, for most of the CIS, projected growth is modest and will remain well below the rates seen in the pre-crisis period.
The recovery is largely driven by domestic demand, notes the report. In Russia, the dynamics of retail trade and mortgage lending are improving amid positive real wage growth. However, consumption is still relatively weak. Investment has been boosted by the 2018 FIFA World Cup preparations.
Inflation in the CIS in 2017 ranged from a near-zero level in Armenia to double-digit price increases in Azerbaijan and Ukraine.
In 2017, global economic growth is estimated to have reached 3%, the highest rate of global growth recorded since 2011. The global economic growth is expected to remain steady at 3% in 2018 and 2019.
The authors point out that the recent acceleration in world gross product growth stems predominantly from firmer growth in several developed economies and cyclical improvements in Argentina, Brazil, Nigeria and Russia, as these economies emerge from recession. The upturn is accompanied by a rebound in world trade and improved investment conditions.
The report highlights some areas where the improved macroeconomic situation opens the way for policy to address longer-term challenges: fighting climate changes, reducing inequality, and tackling institutional deficiencies.More about Economy