Russian Economy General News: #4

By the end of 2014 the volume of foreign trade of Russia fell by 7 percent to 782.9 billion dollars. This is evidenced by the data of the Federal Customs Service (FCS). In this case, the trade surplus increased by a percentage to 210.9 billion from 208.6 billion a year earlier.

The balance in the trade with foreign countries amounted to 179.4 billion (up 2.5 billion), with the CIS countries - 31.5 billion (minus 3.8 billion). In general, Russia has sold goods at 496.9 billion dollars (exports fell by 5.8 per cent), bought - by 286 billion (imports fell by 9.2 per cent).

Russia's revenues from oil supplies fell by 11.3 percent to 153.9 billion dollars. During the year the country exported 223.4 million tons (in 2013 - 236.6 million).

Earlier, on Jan. 27 Ministry of Economic Development reported that the foreign trade turnover of the Russian Federation at the end of 2014 fell by 5.7 percent. The Office also recorded an increase to 220 billion surplus. The ministry explained that it is due to a decrease in imports due to the weakening of the ruble.

"Adaptation of the Russian economy to the new conditions - the price of oil, sanctions and Russian bust cycle - will lead to a drop in the economy this year, but growth in the next," - said the Resurrection, addressing the representatives of the Japanese business. - We intend to take advantage of opportunities and to hold a series of reforms aimed at ensuring sustainable economic growth and welfare of our citizens. "

He said that the Russian economy is now different from the one that faced with the last crisis in 2008. "The balance sheets of banks and companies better prepared, public debt below 15% of GDP, foreign exchange reserves - about $ 400 billion in the US, a record low unemployment rate of 5.2%, - he said. - This is the best performance among the developed countries."

Stanislav Resurrection expressed confidence that "now is a good time to start new projects in the Russian Federation."

"We are open to foreign investors - said the deputy minister of economic development. - And a special priority for us - investment from the Asia-Pacific region."

The economic situation in Russia

According to the head of the Bank of Russia Elvira Nabiullina, inflation in Russia in 2015 on an annualized basis can exceed 15% , but then begin to decline. In turn, the Minister of Economic Development Alexei Ulyukayev said that the peak in inflation is expected in March .

According to Rosstat, inflation in Russia for January 2015 accelerated to 3.9% against 2.6% in December 2014. In annual terms, growth in consumer prices in January was 15%.

Elvira also sees no reason for the ruble jumps to around 80 rubles. per dollar. In addition, she said, Russia's GDP in 2015 could decline by 3-4% at an oil price of $ 50 per barrel.

Earlier, the head of the Central Bank also stated that the factors that led to an increase in the annual inflation rate in Russia up 13.1% at the end of January, strong, but disposable . In her view, such a fall in oil prices, which led to a sharp devaluation of the ruble at the end of last year and acceleration of inflation, is no more.

One seemingly miraculous result of the weak ruble policy has been that Russia’s oil-dependent budget has remained mostly in balance despite the sharp drop in oil prices. That is because both the price of oil and the ruble lost about 50 percent of their value simultaneously. So a barrel of oil now brings the Kremlin roughly the same number of rubles as it did a year ago.

Austin wrote:Credit Suisse coming with its own gloomy doomy projections

Russian Debt To GDP Could Explode To 80% This Year: Credit Suisse

kvs wrote:

Austin wrote:Credit Suisse coming with its own gloomy doomy projections

Russian Debt To GDP Could Explode To 80% This Year: Credit Suisse

Stop the insanity.  

Russian nominal GDP in dollars as of 2013: $2100 billion
Russian state debt in % GDP as of 2013: 7.9% of GDP (https://www.cia.gov/library/publications/the-world-factbook/geos/rs.html)

Let's take a nominal devaluation of the ruble by 50%.  This implies that Russian state debt is 15.8% of GDP.

Out of what a** is Credit Suisse coming up with 80%?  I know they are lumping all debt they could find and theorize about and
doing their moronic and malicious estimate.  They are still off:

Russian total debt including private debt is $679 billion (http://www.cbr.ru/eng/statistics/print.aspx?file=credit_statistics/debt_an_det_new_e.htm&pid=svs&sid=itm_272).  Assuming no GDP growth from 2013 until 2016, we have 32.3% of GDP becoming 64.7%.

Clearly Credit Suisse is getting its numbers out of its a**?

Ministry of Finance of Russia considers it appropriate not to carry out in 2015 indexation of public sector wages and social benefits, said Finance Minister Anton Siluanov . "The position of the Ministry of Finance, it was not discussed in the government, we believe that in the current environment could miss the indexation of salaries as civil servants and other categories of citizens [public sector] and social benefits to ease the budget of the current and subsequent years, do not stimulate consumption, additional demand, including imported goods , "- he said.

In the budget of 2015 has provided the freezing indexation of salaries of civil servants, indexing public sector wages reduced to 5.5% (For general inflation). Indexation of pensions is limited to the rate of inflation.

At the end of last year The Audit Chamber has published a report, the main conclusion is that the government will not be able by 2018 to achieve the goals set for them in the inaugural President's decrees. The plans were based on expectations of high economic growth: 1.6-1.7 times in 2012-2020. In particular, the joint venture to doubt the adequacy of the forecast inflation rate of 5.5%, including double drop rate of growth in food prices.

According Siluanova, budget expenditures-2015 should be reduced even further to 600 billion rubles. planned reduction in excess of 10%. "Over and above 10%, we still need 600 billion rubles. 10% reduction - is 900 billion rubles. To reach the 5% in real terms reduction of budget expenditures, we need an additional 600 billion rubles. ", - Said the minister.

"We have a number of measures that need to be addressed this week and offered as amendments to the budget of 2015" - said Siluanov. According to him, it is a refusal of the new investment, a decrease of 50% of the funding of a number of old projects and a number of other decisions, including legislative measures.

At the end of 2014 Siluanov said that the Finance Ministry does not exclude that in the beginning of 2015 it is decided to cut budget spending by more than 10%. According to the government's anti-crisis plan, budget expenditures can be reduced by at least 5% in real terms during 2016-2018., In 2015 they will be reduced by 10%.

He noted that it is necessary a change of direction of oil. In particular, according to Klepach, during low enough prices for oil exploration offshore projects is inefficient and economically profitable enough. You must change the trek to the development of fields in the traditional production regions, he said.

"We need to focus on the fields in the traditional regions, increasing the recovery factor," - said the deputy chairman of VEB. - But this requires a technological breakthrough. "

Klepach said that the need to "get away from emotion," perceiving negative dependence of the Russian economy away from oil. "This is our advantage, and nothing humiliating it is not," - he said.

The effect of devaluation

However, Klepach said that the devaluation of the ruble Russian economy will bring a positive effect on the level of 1.5 trillion rubles. "Right now, the effect of the devaluation can be estimated at 1.5 trillion rubles," - he said.

However, much of this effect remains in the banking sector, Klepach said, adding that in the coming years Russia will be cut off from the international financial markets.

According to him, the end of the year, Russia's international reserves may be reduced to $ 300 billion, based on the official estimates (now the level of reserves of $ 376.2 billion - Ed.).

Klepach believes that the traditional "book" rules, inflation targeting is unlikely to be effective enough. In general, higher rates are needed, he said, noting however that this should be established flow of liquidity, which will work on different terms / at lower rates - Ed

Austin wrote:Some interesting notes

Klepach said comfortable for the Russian economy the price of oil at $ 60-70 per barrel

"Now there is a price increase, and the level of $ 60-70 will be comfortable enough for us," - he said.

He noted that it is necessary a change of direction of oil. In particular, according to Klepach, during low enough prices for oil exploration offshore projects is inefficient and economically profitable enough. You must change the trek to the development of fields in the traditional production regions, he said.

"We need to focus on the fields in the traditional regions, increasing the recovery factor," - said the deputy chairman of VEB. - But this requires a technological breakthrough. "

Klepach said that the need to "get away from emotion," perceiving negative dependence of the Russian economy away from oil. "This is our advantage, and nothing humiliating it is not," - he said.

The effect of devaluation

However, Klepach said that the devaluation of the ruble Russian economy will bring a positive effect on the level of 1.5 trillion rubles. "Right now, the effect of the devaluation can be estimated at 1.5 trillion rubles," - he said.

However, much of this effect remains in the banking sector, Klepach said, adding that in the coming years Russia will be cut off from the international financial markets.

According to him, the end of the year, Russia's international reserves may be reduced to $ 300 billion, based on the official estimates (now the level of reserves of $ 376.2 billion - Ed.).

Klepach believes that the traditional "book" rules, inflation targeting is unlikely to be effective enough. In general, higher rates are needed, he said, noting however that this should be established flow of liquidity, which will work on different terms / at lower rates - Ed

kvs wrote:http://www.sdelanounas.ru/blogs/58507/

The CBR has switched 91 Russian banks to the Russian version of SWIFT.

Looks like Russia is moving fast and will be fully independent of SWIFT by the end of this year.

Eat that you NATO wankers!

Drilling Deeper: New Report Casts Doubt on Fracking Production Numbers


Among the key findings:

-By 2040, production rates from the Bakken Shale and Eagle Ford Shale will be less than a tenth of that projected by the Energy Department. For the top three shale gas fields — the Marcellus Shale, Eagle Ford and Bakken — production rates from these plays will be about a third of the EIA forecast.

-The three year average well decline rates for the seven shale oil basins measured for the report range from an astounding 60-percent to 91-percent. That means over those three years, the amount of oil coming out of the wells decreases by that percentage. This translates to 43-percent to 64-percent of their estimated ultimate recovery dug out during the first three years of the well's existence.

-Four of the seven shale gas basins are already in terminal decline in terms of their well productivity: the Haynesville Shale, Fayetteville Shale, Woodford Shale and Barnett Shale.

-The three year average well decline rates for the seven shale gas basins measured for the report ranges between 74-percent to 82-percent.

-The average annual decline rates in the seven shale gas basins examined equals between 23-percent and 49-percent. Translation: between one-quarter and one-half of all production in each basin must be replaced annually just to keep running at the same pace on the drilling treadmill and keep getting the same amount of gas out of the earth.

Drilling Deeper: New Report Casts Doubt on Fracking Production Numbers

Austin wrote:BTW What is Russian GDP for 2014 by PPP ?

Nominal GDP almost decreased by half to $1100 billion.

Also what is per capita income for 2014 ?

sepheronx wrote:

Austin wrote:BTW What is Russian GDP for 2014 by PPP ?

Nominal GDP almost decreased by half to $1100 billion.

Also what is per capita income for 2014 ?

Where did you get that number? Trading economics still showing $2T.