Slowdown in economic activity may indicate serious budget problems

The economic growth activity is expected to slow down. According to the latest data, the economic activity indicator increased by 8.1% in January-October.

The slowdown in economic activity is driven by external factors. And even in that case, those sectors that are still affected by these factors contribute to the growth. Those are trade, construction, and foreign trade turnover. Construction is growing at the rate of housing construction.

At the same time, as much as these sectors still play the role of the main driving force, their growth rates are also slowing down.

If in January-August the industrial growth amounted to 13.7%, in January-October it already decreased by 2 percentage points. We have the same process in other directions. By the way, the weakening of the growth rates of both industry and foreign trade turnover is associated with the weakening of gold re-export.

These trends make the 7% economic growth originally planned for the 2024 budget (the government adjusted it downward) more unrealistic, raising serious questions about budget execution.