English | دری

A Snapshot of the Current Status of Russia’s Economy

in International Business

A Snapshot of the Current Status of Russia’s Economy

Despite not seeing double-digit economic growth for over ten years, and been hit hard by the recession in 2009, Russia has had an average annual growth rate since 2000 of over 5%. And according to the OECD, a mostly rich-country think-tank, Russia’s economy will expand by 4% this year and next. While inflation is set to be over 8% this year, high for a middle-income country, at the beginning of the 2000s, it was over 20%. The unemployment rate has followed a similar pattern and is now below the OECD average. Labour force participation rates are also high. But perhaps Russia’s most striking achievement is its fiscal performance. In contrast to persistent budget deficits in the 1990s, up until recently Russia enjoyed a series of surpluses, thanks to high and rising oil prices, economic growth, fiscal reform and prudent management. Revenues from oil and gas, which by 2008 accounted for a third of all government revenues (some $200 billion), were used to repay external debt and build up assets in a stabilisation fund, which was recently used to inject a fiscal stimulus. But Russia’s budget balance is dependent on the oil price. Strip oil out and its public finances have been deteriorating since 2005. Reducing the public budget’s dependence on oil revenues would further modernise its economy. The OECD would also like to see a more business-friendly environment and effective social policies to reduce income inequality.



Related Articles

France to present its first budget

French President Francois Hollande is set to present his country’s first budget, which he has said is the “toughest budget”

China’s exports decline

China’s exports grew 2.9% in November, far below the expectations of analysts who had expected a 9% growth. This comes

Workers around the world mark May Day

Tens of thousands of people take to the streets across the globe, protesting against job cuts and austerity measures. Tens

No comments

Write a comment
No Comments Yet! You can be first to comment this post!

Write a Comment

Your e-mail address will not be published.
Required fields are marked*

Time limit is exhausted. Please reload the CAPTCHA.