Trends of the Russian Federation
Economic Development
Vladimir N. Kniaginin, Director, Foundation Center for Strategic Res...
Russia faces deterioration of the economic situation: while the pace of
current economic growth is reducing further instab...
Russian regions also deal with the deterioration of economic situation:
their inability to fulfill the obligations leads t...
Risks of the economic reduction in Russia are caused by the
uncertainty of commodity markets’ development

Dynamics	
  and...
Deterioration of the partner countries’ economic situation is also a source
of the crisis phenomena

The stagnation of the...
After facing the problem of the global economic recession Russia began
to deal with risks within its own economy. One of s...
In these circumstances the Government acts as a crises damper and a
main driver of economic recovery

Financial reserved f...
The Government began to optimize its costs but until now this process
has been accompanied by an increase of social expens...
Overall import growth is likely to be among new threats for Russian
economic recovery after our entering the WTO. This wil...
Other new threats include an increased role of factors not related to the
global economic environment

Expenses for holdin...
The Russian Government needs to respond on increased complexity of all
state development processes. It leads to changing e...
Russia tries to extend its cooperation with emerging APEC economies

RF Ministry of the Far East development has
been crea...
Foundation Center for Strategic Research “North-West” – independent
think tank

Thank you for your attention!

Address:	
 ...
Upcoming SlideShare
Loading in...5
×

Trends of the Russian Federation Economic Development

320

Published on

Vladimir N. Kniaginin, Director, Foundation Center for Strategic Research «North-West»
Economic Policy Dialogue among think tanks of emerging economies

Published in: Economy & Finance, Business
0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total Views
320
On Slideshare
0
From Embeds
0
Number of Embeds
0
Actions
Shares
0
Downloads
11
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

Transcript of "Trends of the Russian Federation Economic Development"

  1. 1. Trends of the Russian Federation Economic Development Vladimir N. Kniaginin, Director, Foundation Center for Strategic Research «North-West» Economic Policy Dialogue among think tanks of emerging economies November, 2013
  2. 2. Russia faces deterioration of the economic situation: while the pace of current economic growth is reducing further instability is likely to occur % 8,3   7,6   8,0   7,4   8,3   7,6   7,3   7,3   7,4   6,3   6,0   5,7   5,5   5,4   3,4   4%-ghetto level 6,0   5,4   4,6   4,0   6,1   3,6   3,0   4,3   3,6   4,5   3,9   4,8   4,0   4,4   3,8   4,9   4,3   3,8   4,2   3,4   4,1   3,1   3,8   2,8   3,9   3,6   2,6   2,0   0,0   2002     2003     2004     2005     2006     2007     2008     2009     2010     2011     2012     2013     2014     2015     2016     2017     2018     2019     2020     2025     2030     -­‐2,0   -­‐4,0   -­‐6,0   -­‐7,6   -­‐8,0   Innovative scenario Realistic scenario Source: Ministry of economic development of the Russian Federation Pessimistic scenario 2
  3. 3. Russian regions also deal with the deterioration of economic situation: their inability to fulfill the obligations leads to the increase of regional debt burden The level of debt load is high or critical in 23 regions of Russia Leningrad Region Arkhangelsk Region Tver Region Vologda Region Yaroslavl Region Kaluga Region Moscow Region Ryazan Region Nizhny Novgorod Region Belgorod Region Republic of Mordovia Udmurtian Republic Republic of Tatarstan Saratov Region Krasnodar Territory Samara Region Sverdlovsk Region Volgograd Region Orenburg Region Republic of Sakha (Yakutia) Krasnoyarsk Territory Omsk Region Kemerovo Region Regions with most crucial debt level: Over 28 120,00 billion rubles From 18 373,00 to 25 403,00 billion rubles Source: Ministry of Finance of the Russian Federation 3
  4. 4. Risks of the economic reduction in Russia are caused by the uncertainty of commodity markets’ development Dynamics  and  structure  of  export  of  the  Russian  Federa6on   2008 2000 24% нефть Oil   38% 34% 38% газ Gas     нефть Oil   Gas   газ   13% 22% Urals Oil Price Forecast , US$ per barrel Non-Ferrous Metals Prices Forecasts*, US$ / t 110,8 93,9 100 80 60,9 69,6 104 113 12% Ferrous Metals Prices Forecasts, US$ / t 600 38118 39000 109,6 Others   прочее     8% 500 127 120 Gas   газ   Metals   металлы 15% 151 140 44% Others   прочее     Others   прочее     160 нефть Oil   36% Metals   металлы Metals   металлы 16% 2012 37000 35297 78,2 area of fiscal instability 33000 60 27000 0 376 300 31517 29000 20 31794 425 31000 40 471 395 400 35000 60,8 478 25000 200 27404 100 2010 2011-2015 2016-2020 2021-2025 2026-2030 0 2010 Source: Russian Federal State Statistics Service, Federal Customs Service of Russia, Ministry of economic development of the Russian Federation 2011-2015 2016-2020 2021-2025 2026-2030 4
  5. 5. Deterioration of the partner countries’ economic situation is also a source of the crisis phenomena The stagnation of the Eurozone economy is one of the basic reasons of the Russian economic growth reduction GDP growth in the EU (28 countries), % per year 3 2 2 1 0 1,7 -0,4 0,4 2008 2009 2010 2011 2012 -1 -2 -3 -4 -5 -4,5 Source: Ministry of economic development of the Russian Federation 5
  6. 6. After facing the problem of the global economic recession Russia began to deal with risks within its own economy. One of such threats is a slowdown of the consumer market growth. Wage growth has exhausted its sources. Despite the positive retrospective further wage growth rate might be significantly reduced. This leads to serious risks of failure to perform most consumer obligations. Among the main problems is a high level of loan commitments taken by population in the period of favorable economic conditions. 77 667 162 26628,9 23369,2 Volume of consumer crediting to individuals saw a twice-level growth in the last 5 years 20952,2 18637,5 17290,1 66 328 347 2013, result for 8 months 54 951 980 13593,4 42 456 010 10633,9 45 284 113 44 382 795 8554,9 6739,5 5498,5 27 841 523 billion  rubles 2003 2004 2005 2006 2007 2008 2009 2010 Source:  Russian  Federal  Treasury,  Russian  Federal  State  StaDsDcs  Service   2011 2012 2007 2008 2009 2010 2011 2012 2013 6
  7. 7. In these circumstances the Government acts as a crises damper and a main driver of economic recovery Financial reserved funds are used to ensure more stability Current operation account 60   Changes in Foreign Exchange Reserves 54   31   22   20   50   40   But in the long run it creates new risks 33   4   32   30   22   20   14   12   2013   2014   2015   2016   -­‐45   -­‐43   -­‐43   11   10   billion rubles 0   2013   2014   75  dollars  per  barrel   Source: Central Bank of the Russian Federation 2015   2016   125  dollars  per  barrel   billion rubles 75  dollars  per  barrel   125  dollars  per  barrel   7
  8. 8. The Government began to optimize its costs but until now this process has been accompanied by an increase of social expenses Plans to save funds of the Federal budget (according to proposals of the Russian Federation Ministry of Finance to reduce public spending) The growth of social obligations creates a threat to the Russian budget Share of expenditures to healthcare, education and social benefits in the total RF Federal budget 581,9 2012     2008     377,1 194,5 million rubles 2014   2015   Source: Ministry of Finance of the Russian Federation 2016   8
  9. 9. Overall import growth is likely to be among new threats for Russian economic recovery after our entering the WTO. This will have particular impact on sectors with low level of competitiveness. Consequences of Russia's entering the WTO for the Leningrad region and St. Petersburg industries (from 2011 till the end of the transition period in the industry) Change  in  produc6on   volume,  %   Change  in  skilled  labour   force  wages  ,  %   Change  in  unskilled  labour   force  wages,  %   Food  industry -­‐1,33   -­‐0,95   -­‐0,43   Light  industry -­‐4,67   -­‐4,77   -­‐4,27   Wood  processing,  pulp  and  paper   produc6on,  produc6on  of  wooden     goods -­‐5,21   -­‐5,05   -­‐4,56   -­‐2,3   -­‐1,73   -­‐1,21   Chemical  and  petrochemical   produc6on 1,13   1,48   2,02   Ferrous  metallurgy 33,48   36,07   34,77   Nonferrous  metallurgy 35,81   36,44   37,16   Mechanical  engineering -­‐2,4   -­‐2,32   -­‐1,81   Produc6on  of  building  materials -­‐2,54   -­‐2,28   -­‐1,77   Other  industries -­‐1,35   -­‐1,45   -­‐0,94   Electricity  genera6on 0,25   0,67   1,20   Industry   Oil  goods  produc6on Source: Russian economic school and Ernst&Young 9
  10. 10. Other new threats include an increased role of factors not related to the global economic environment Expenses for holding the Olympics in SOCHI-2014 Flood 2013 in Khabarovsk territory Flood 2013 in the Khabarovsk region 7%   37%   32%   Investors   18%   Total expenditure 10%   General damage 40 billion rubles Olympstroy   1,5 trillion rubles Housing  RehabilitaDon   Federal  ExecuDve  AuthoriDes   AdministraDon  of  the  Krasnodar   region  and  Sochi   VicDm  Assistance   Agricultural  losses   Others   65%   20%   Source: Ministry of regional development of the Russian Federation 11%   10
  11. 11. The Russian Government needs to respond on increased complexity of all state development processes. It leads to changing economic policy. What affects development of the Russian Federation Goal of the Russian Federation Development Who ensures the goal achievement World competition growth Decline of global demand RF workforce reduction Creation of Smart State Government 1. Inefficiency of state structures 2. Low quality of public administration Business 1. Dependence on the budget money 2. Slow rate of implementation of innovations 3. Low labor productivity Individuals 1. Gap between existing competencies and market requirements 2. Low entrepreneurial activity What hinders the goal achievement Source: D. Medvedev, «The time of simple solutions passed off» // Vedomosti, 27.09.2013 11
  12. 12. Russia tries to extend its cooperation with emerging APEC economies RF Ministry of the Far East development has been created and new management bodies have been formed AGENCY  FOR  INVESTMENT   AND  EXPORT  SUPPORT   New infrastructure is being created: Special Economic Zones (SEZ), ports, transport corridors CORPORATION  OF  RUSSIAN   EAST  DEVELOPMENT   Ac#ve  policies  on  the  global  market   of  direct  investments   Crea#on  of  export  territory  of   priority  development,  industrial  and   technology  parks   Countries  of  the  Asia-­‐Pacific  Region   (APR  countries)   The  coastal  towns  of  far  East  Federal   district  (FEFD)   FOUNDATION  OF  THE  FAR   EAST  AND  BAIKAL  REGION   DEVELOPMENT   Harbin AGENCY  OF  HUMAN  CAPITAL   DEVELOPMENT   Interna#onal  Public  Private   Partnership  in  infrastructure  projects   Policy  for  aIrac#on  of  residents  and   staffing  of  investment  projects   APR  countries  and  the  ci#es  of  FEFD   Ci#es  in  Russia  and  Ukraine   Source: Ministry of development of the Far East, Administration of Primorsky Krai PRIMORYE 1 •  Harbin •  Suifenhe •  Vladivostok •  Nakhodka •  Vostochny Changchun PRIMORYE 2 •  Changchun •  Hunchun •  Zarubino 12
  13. 13. Foundation Center for Strategic Research “North-West” – independent think tank Thank you for your attention! Address:  26  line,  VI,  15-­‐2-­‐A,  St.Petersburg,     Russia,  199106   Phone  (fax):  +7  812  380  0320,  380  0321   E-­‐mail:  mail@csr-­‐nw.ru     Materials  are  available  at    www.csr-­‐nw.ru   13
  1. A particular slide catching your eye?

    Clipping is a handy way to collect important slides you want to go back to later.

×