Russian Economy General News: #5

JohninMK wrote:

Project Canada wrote:

Why are Liberal Economists Outraged by Putin Advisor's Reform Proposals?

On Tuesday, economist Sergei Glazyev will submit a report to Russia's Security Council, offering his vision on how the country can overcome the effects of Western sanctions and return to economic growth. Last week, Glazyev's proposals leaked to the press, leading to a firestorm of criticism from Russia's liberal economists. Sputnik finds out why.

Sergei Glazyev, a Russian Ukrainian economist, politician, and specialist on the Eurasian Economic Union, will present his report to the Russian Security Council, a consultative body reporting to the Russian president charged with working out decisions on issues of national security, this Tuesday. His report, leaked to Russian business newspaper Kommersant last week, features a number of controversial, unconventional and decidedly anti-liberal proposals for dealing with the effects of Western sanctions, stabilizing the course of the ruble, and restoring economic growth.

The plan proposes a five-year 'road map' to Russia's economic sovereignty and long-term growth, and is ostensibly aimed at helping the country to avoid the 'stagflation trap' of economic stagnation and growing inflation. The plan is presented as being aimed toward building up the country's immunity to external shocks and foreign influence, and ultimately, toward bringing Russia out of the periphery and into the core of the global economic system.

The plan's ambitious goals include raising industrial output by 30-35 percent over a five year period, creating a socially-oriented 'knowledge economy' via the transfer of substantial economic resources to education, health care and the social sphere, the creation of instruments aimed at increasing savings as a percent of GDP, and a number of other initiatives, including a program aimed at transitioning to a sovereign monetary policy.

Read more: http://sputniknews.com/business/20150915/1026993814/russia-economics-reform.html#ixzz3lkdDq65E

What do you guys think about Glazyev's economic strategy? is it promising? or is it simply unrealistic?

That plan would never get a go ahead in the West, it doesn't show results in 6 months. So, given the mess the West is in following its methods, I'd say its a pretty good plan that deserves to succeed. Its about time someone, apart from perhaps the Chinese, thought a few years ahead, not just until the next election or company result announcement.

flamming_python wrote:

Project Canada wrote:

Why are Liberal Economists Outraged by Putin Advisor's Reform Proposals?

On Tuesday, economist Sergei Glazyev will submit a report to Russia's Security Council, offering his vision on how the country can overcome the effects of Western sanctions and return to economic growth. Last week, Glazyev's proposals leaked to the press, leading to a firestorm of criticism from Russia's liberal economists. Sputnik finds out why.

Sergei Glazyev, a Russian Ukrainian economist, politician, and specialist on the Eurasian Economic Union, will present his report to the Russian Security Council, a consultative body reporting to the Russian president charged with working out decisions on issues of national security, this Tuesday. His report, leaked to Russian business newspaper Kommersant last week, features a number of controversial, unconventional and decidedly anti-liberal proposals for dealing with the effects of Western sanctions, stabilizing the course of the ruble, and restoring economic growth.

The plan proposes a five-year 'road map' to Russia's economic sovereignty and long-term growth, and is ostensibly aimed at helping the country to avoid the 'stagflation trap' of economic stagnation and growing inflation. The plan is presented as being aimed toward building up the country's immunity to external shocks and foreign influence, and ultimately, toward bringing Russia out of the periphery and into the core of the global economic system.

The plan's ambitious goals include raising industrial output by 30-35 percent over a five year period, creating a socially-oriented 'knowledge economy' via the transfer of substantial economic resources to education, health care and the social sphere, the creation of instruments aimed at increasing savings as a percent of GDP, and a number of other initiatives, including a program aimed at transitioning to a sovereign monetary policy.

Read more: http://sputniknews.com/business/20150915/1026993814/russia-economics-reform.html#ixzz3lkdDq65E

What do you guys think about Glazyev's economic strategy? is it promising? or is it simply unrealistic?

I think it's unrealistic, it promises 6-7% industrial output growth per year but apart from some fluff terms and budget readjustments it doesn't offer anything new.
Besides which investment into education and health care as a means of promoting economic growth will take decades to have an effect, not 5 years.

Putin also promised 6% annual GDP growth when campaigning for re-election. I voted for him on that promise. He didn't hold it - we didn't get near that amount of growth. Of course now we have the Ukraine crisis and anything, but even in the 2-3 years before that, we were underperforming and not achieving much higher than 2% growth.

In general I approve of government economic policy as it has the priorities in all the right places. Promoting industrialization and localization with a free-floating rouble, auto-manufacturing, revival of North Sea sealane, reforms and support for SMEs, focus on big infastructure projects, new railroads and motorways and logistics hubs, new spaceport in Vostochny, high-tech investment funds, consolidation of small state enterprises into larger corporations, promotion of Russian defence/nuclear/energy technology overseas, pipeline construction and new gas/oil field exploitation, support for the nascent wood-processing industry, banning of European agriculture and supporting domestic agriculture, pivot towards promising markets in Asia, Skolkovo and related ventures, free port initiative in Vladivostok, support for promoting tourism, anti-corruption drive, general lobbying for investment from Western and Asian multinationals, titanium valley and aerospace clusters, revival of shipbuilding, rainy day funds that accumulated oil wealth, Eurasian Union integration (even if it can be improved), World Trade Organization membership... and so on.
We're basically doing all the right things, but as events (and our own inefficiencies) would have it - we haven't achieved the targets we set for ourselves and we aren't growing at our full potential.

I think what's needed is to stay the course, shelve unsuccessful projects, expand the fruitful ones further, and keep looking for improvements to make. Like I said, so far a lot of the priority directions and initiatives sound promising; but they still need to be seen through.

So in this light, you can see what my objections to Glazyev's 'plan' might be - what does he propose that isn't already being done? How does he intend to so radically change the situation so as to guarantee 6-7% industrial growth for the next 5 years?
Sounds like a premature declaration built on the basis of immature and undeveloped vague ideas - reeks of populism IMO.

In Pereslavl-Zalessky, opened the largest garment manufacturing — garment factory "Leia". Prior to this production was in Moscow, the company has worked since 2007.
Area — 2500 sq. m.
Population — 200 production staff.
Mode of operation — seven days a week.
Capacity — 30 000 pieces of garments per month.
Factory engaged in making women's and men's clothing to order, and sells its products wholesale. Our clients are major wholesale distributors, regional trading companies, brands men's and women's clothing.

"ROSNANO" and "Prepreg-SKM" will help to build rockets, bridges, cars and ... career. Portfolio company RUSNANO "Prepreg-SKM", included in the structure of a "Holding company "Composite", has launched a new product — carbon braided preforms of different diameter and surface density.
This woven material made from carbon or glass fibre, is a semi-finished product in the form of a "sleeve" or multi-layer braid. It is used for braiding of long products (up to 15 meters) and complex shapes (e.g. car bumpers).
"Woven preforms is an innovative product for the Russian market. Now his experience in the Russian aircraft manufacturing enterprises in the framework of research. If the tests are successful, in the coming years, the aerospace industry will be the main consumer of braided preforms," said senior process engineer "Prepreg-SKM" Shumakov Anton.
Aerospace braided preforms used to manufacture the spars of the fuselage of the aircraft, elements of aviation engines, helicopter stands, landing gear, propellers, flaps, and power elements of spacecraft design.
Demanded this material also when creating arch bridges, tubes, sports equipment, components for cars and other products and structures.
In automobile manufacturing braided preforms are used for the production of carbon fiber windscreen frame, ultra-light composite disk, design elements, intended to repay shock loads during accidents. Such components in comparison with metal parts much lighter, stronger and have a high resistance.
For the construction of concrete-composite bridges with prefabricated arch structures are made directly at the construction site. Braided sleeve, which forms the backbone of the future product, mounted on the base and fill with concrete. Such facilities are more durable than reinforced concrete and steel structures. In addition, reduced construction time, costs, and operational costs. Currently, the "Prepreg-SKM" are made of braided preforms for future arched constructions of prefabricated bridge, which is planned to be built in Ulyanovsk region.
Among the sports goods manufactured using braided sleeves, Bicycle frame and a hockey stick. Such reinforced clubs are now playing regional teams hockey with the ball in the Ulyanovsk region and the Krasnoyarsk territory.
Carbon preforms are manufactured on specialized equipment, located at the production sites of "Prepreg-SKM" in Technopolis "Moscow". This unique and innovative machine radial weave, full which has no analogue in Russia.
"The machine is able to produce more than 300,000 meters of braided sleeves, braid over 8,000 long-tail snap-ins and 100,000 curved shapes car bumpers" — listed equipment Shumakov Anton.

Austin wrote:Russia to Spend $38Bln From Reserve Fund in 2015

Read more: http://sputniknews.com/business/20150916/1027090120.html#ixzz3lyllCP5I

MOSCOW (Sputnik) — As of August 31, Russia's Reserve Fund totaled 4.7 trillion rubles, while the National Wealth Fund accumulated 4.9 trillion rubles.

"We will spend 2.5 trillion [from the Reserve Fund] this year," Siluanov told reporters.

He added that the Finance Ministry was planning to keep at least 2 trillion rubles cumulatively in the Reserve Fund and the National Wealth Fund by the end of 2018.

Read more: http://sputniknews.com/business/20150916/1027090120.html#ixzz3lylsSZbf

So if they spend 2.5 Trillion on Reserve fund , from 4.7 only  2.2 Trillion would be left