World Bank cuts Russian growth outlook to 4.2 pct

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The World Bank said on Tuesday it had cut the outlook for growth of the Russian economy this year from 4.5 percent to 4.2 percent, citing volatile capital flows and oil price uncertainties.

"With heightened uncertainties and moderating global and western European growth and oil prices, and volatile capital flows, Russia is likely to grow by 4.2 percent in 2010," the bank said in a report.

Russia was hard hit by the global economic crisis, with the economy contracting 7.9 percent last year, but reserve funds built up in times of high oil prices have helped it avoid the economic problems that have plagued some European Union states.

The World Bank, which in June cut its growth forecast for Russia's economy this year from 5-5.5 percent previously, said it was also forecasting growth of 4.5 percent in 2011 and 3.5 percent in 2012.

Russian authorities are predicting economic growth of four percent this year.

© 2010 AFP

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