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Wednesday, November 13, 2019

EBRD revises regional economic forecast downward

The European Bank for Reconstruction and Development (EBRD) released a report on Monday detailing the effects from Russia's downturn that have been worsened by falling oil prices.

The EBRD said countries that are within the regions served by the EBRD can expect to contract by an average of 0.3 percent in 2015, compared with a September forecast for growth averaging 1.7 percent. Economists for the bank expect that Russian gross domestic product will shrink by nearly 5 percent, which had been struggling financially prior to the recent fall in oil prices. Prior estimates predicted a 0.2 percent contraction. Other countries that have been hit hard by oil price fluctuations include Kazakhstan, Azerbaijan and Turkmenistan.

There is optimism for countries in the form of lower energy costs, as trade enhancements can buffer oil's impact on emerging economies in the region.

Turkey is expected to see a 3 percent growth rate with the help of lower energy-import costs, but weakening external demand remains a factor to weigh on growth.

Economic struggles are expected to continue in Ukraine due to continued conflict. The report also said international sources of financing are not enough or won't come through soon enough.

Organizations in this Story

European Bank for Reconstruction and Development

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