Zeljko Bogetic said the World Bank expected the global economic situation to improve in the latter half of 2009, and predicted it would be followed by a recovery in economic growth in Russia.
"I believe, the peak of the crisis will be past by then and will be followed by a recovery in economic growth in Russia," he said adding that the forecast is based on expectations relating to the global economic situation, the world oil market, capital flows and global demand.
The World Bank recently revised its forecast for Russian GDP growth down to 6% in 2008 and to 3% in 2009, from 6.8% and 6.5% respectively.
The expert said GDP growth could slow down to 2% in the nearest two quarters but "under conditions of a severe global crisis, this is not a bad result."
"It is important to ensure a balance between support to the real economy, social programs and investment...and the need to maintain macroeconomic stability," Bogetic said.
Some analysts are not ruling out that Russia could have zero or even negative growth if oil prices drop significantly. However the World Bank believes growth will be positive. "Considering oil price dynamics, capital dynamics and global economic development, we will not see negative growth in Russia either this year or next," Bogetic said.
He said the World Bank had considered a scenario of a more substantial decline in oil prices, to $40 per barrel and lower, but added that this could only last for a brief period. The bank's forecast is an average $74-74 per barrel of Brent in 2009, and around $70 for the Russian benchmark Urals blend.
"With such prices, the Russian budget will be well-balanced and unlikely to be negatively effected," he said but added: "If the situation worsens, we will review the forecast."
He also said that the forecast that capital flight from Russia would reach $100 billion net next year was not catastrophic.
"As a rule, capital inflow is high when the economy grows fast and oil prices rise as well. Now everything is reversed so inflows can hardly be expected. But taking into account the macroeconomic situation and accumulated reserves net flight of $100 billion is not capable of destabilizing the Russian economy," Bogetic said.
Capital inflow in the second half of 2009 will gradually make up for capital flight, the expert said.
"The peak of flight could be behind us by the fourth quarter of 2008 when the most important repayments on foreign debts are due to be paid," he said.
