03:28 GMT +3 hours25 November 2014
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Russia's GDP Growth to Fall to 3.5% - S&P

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(updated 18:27 28.10.2014)
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International ratings agency Standard & Poor forecast that Russia's gross domestic product growth is to slow to 3.5 percent in 2012, the agency said on Thursday.

International ratings agency Standard & Poor forecast that Russia's gross domestic product growth is to slow to 3.5 percent in 2012, the agency said on Thursday.

"Following 4.2 percent growth in 2011, we think the slowdown will lead to GDP growth of about 3.5 percent for the full year," S&P Chief Economist for Europe Jean-Michel Six said in a statement.

Last year Russia’s gross domestic product grew by 4.2 percent, the world’s third highest growth rate among leading economies. The government expects it to grow 3.7 percent this year.

The agency stressed that Russia's economic growth was high last year owing to strong industrial production, lower unemployment and buoyant consumer demand, while capital outflows had accelerated due to perceived investment restraints and political uncertainties about structural reforms.

Bank of Russia estimated the outflows at $84 billion in 2011, the second-largest outflow in the history of modern Russia, S&P also said in the statement.

"Looking forward, it is difficult, in our opinion, to see what would slow this rise in capital outflows in 2012," Mr. Six added. "Meanwhile, political uncertainties at home will not necessarily disappear immediately after the presidential elections. There will still be many questions relative to the pace at which the new government will be ready to undertake structural reforms."