2005 GDP FORECAST REDUCED, INFLATION RATE UNCHANGED - GREF

KRASNODAR, May 27 (RIA Novosti) - The Russian Economic Development and Trade Ministry reduced the 2005 GDP growth forecast from 6.5% to 5.8%, minister German Gref told RIA Novosti on Friday.

The GDP growth was 5.4% over January - April of 2005, he added.

According to Gref, the 2005 inflation forecast (10%) remained unchanged.

The ministry also reduced the 2005 industrial growth rate, he added.

The ministry forecasted a 5.6% GDP growth for 2006, 6% for 2007, and 5.8% for 2008, Gref said.

He explained the forecast reduction by "more restrained dynamics of oil production and exports" and investment decline.

"We forecasted oil production growth to reduce by 5% and it was 3.2%," the minister said.

However, the Economic Development and Trade Ministry expects higher rates of the GDP growth in the second half of 2005. "The first three months we hard. We believe that the second half will be better," Gref said.