Key developments and challenges

The stimulus provided by the fiscal package and liquidity injections into the banking system are expected to arrest the sharp fall in output observed in early 2009, with the economy returning to growth in late 2009 or 2010, supported by a combination of higher commodity prices, fiscal stimulus and a gradual recovery of external demand. However, the economy remains highly dependent on oil and gas export receipts, and the main risk is of a further decline in commodity prices which could delay recovery and put pressure on the rouble and the financial system.