International Business

Russian Central Bank Report Forecasts 18% Decline in GDP: The nation’s economy will contract much more sharply this year than the government predicted if monetary conditions remain tight, the Central Bank of Russia said in a report. But easing credit in an effort to stimulate production would only lead to further inflation, the report says, because enterprises have not taken steps to adapt to the needs of the market and their products will not find buyers. The forecast says inflation-adjusted gross domestic product will fall 18% this year from 1993, sharper than the 8% to 10% drop projected by the government earlier this year and the 12% drop seen in 1993. The central bank said the main force behind the decline will be an expected 25% decline in industrial output this year. “The whole of 1994 could become one of industrial decline unprecedented in the whole history of Russian reforms,” it said.