Russian Economy General News: #10

Rosstat estimated the growth of Russia's GDP in 2018 at a maximum of 2.3% in the last 6 years

MOSCOW, Feb 4 - PRIME. Rosstat estimated the growth of Russia's GDP in 2018 at 2.3%, which is higher than the forecasts of the Ministry of Economic Development and the Central Bank.

As follows from the materials on the Rosstat website, GDP growth in the past year was a record since 2012, when the economy grew by 3.7% in annual terms. In subsequent years, the economy grew by 1.8% and 0.7% in 2013 and 2014. At the end of 2015, a fall of 2.5% was recorded. In 2016 and 2017, GDP growth was 0.3% and 1.6%, respectively.

"Russia's GDP for 2018, according to the first estimate, amounted to 103,626.6 billion rubles at current prices. The physical volume index of GDP compared to 2017 was 102.3%. The GDP deflator index for 2018 relative to 2017 prices amounted to 110%, "- said in a statement of the statistical agency.

The Ministry of Economic Development at the end of January improved the estimate for the growth of Russia's GDP in 2018 from 1.8% to 2%, largely due to the rise in the construction industry. The Bank of Russia, in turn, reported that, according to the results of last year, the GDP growth rate was near the upper limit of the forecast interval of 1.5-2%.

https://1prime.ru/state_regulation/20190204/829680362.html

2,3% is a solid performance

Thanks for sharing.

That is actually... already almost good enough, even for long-term. (But even then the growth should/will pick up from around 2020 onwards.) That is probably also above West's and even USA's long-term annual growth. Pretty impressive.

What was industry's growth rate? Must have been close to 4%?

This shows that the earlier forecasts of the Ministry of Economic Development were indeed the most accurate ones, like (almost) always.  

The sanctions aren't... really working. An open secret, if you will... After all, the gas station is in tatters and doesn't make anything.  



Interestingly, they have updated some earlier estimates as well. It was already reported a while ago that the economy actually only declined in 2015, but I didn't know about the new figure for 2013. The growth was originally 1.3% if I remember correctly, but it has now been updated to 1.8%. (Though wasn't growth in 2012 slightly above 4% originally? So has there been a slight downgrade? I might remember wrong.)

GunshipDemocracy wrote:

dino00 wrote: 2,3% is a solid performance

Banderstan had 3%

What do you mean by that?

I assume you think Ukraine's numbers are fake?

Personally I try to be as consistent and objective as possible, and so I "automatically" believe every country's statistical agency, especially in regards to basic metrics, like annual economic growth. (The sustainability of that growth is of course another matter and very much depends on the country.)

For one thing, the Russian and Ukrainian economies are not comparable at all, so neither are their growth rates.

Overall, in Ukraine some kind of recovery after 2014-15 was and is inevitable and further decline impossible. It seems its economy is still only as large as it was in 2013 (at "best") and it was a very poor country by European standards even back then, so 3% is obviously not impressive at all.

That said, in all honesty it's not totally terrible either. So equally honestly, "we" should probably hope that Ukraine won't be able to keep that up. Not that it really matters too much either way, because even if Ukraine's average growth remains at the current level far into the future, its convergence to Russian or Western living standards will be slow, very slow even.

But that's the reality. Not that it really matters to many posters and readers here, I'm sure, they think Ukraine's collapse is always just around the corner... Because being an American puppet without any industry leads to a total collapse elsewhere. (It doesn't.)

Fuck Ukraine though. 2.3% already in 2018 is actually good, and a positive surprise, don't you agree?

Let´s wait now for the real numbers from Mr. Hellevig.

GunshipDemocracy wrote:

dino00 wrote: 2,3% is a solid performance

Banderstan had 3%

Chips soldered to the state budget.  Angstrom-T plant needed new funding

https://www.kommersant.ru/doc/3873980

VEB.RF became the sole shareholder of Angstrem-T, formerly owned by former Communications Minister Leonid Reiman, at the end of December 2018. Back in 2008, the company took a loan of € 815 million from VEB to purchase equipment and build a microchip plant, but was unable to pay off debts to the state corporation and other creditors. One of the reasons was the US sanctions restrictions, under which the company fell in 2016. In 2018, it was decided to convert the debt to VEB into authorized capital, after which the state corporation bought all Angstrem-T shares for 1 ruble, the source told Kommersant. Leonid Reiman remained the chairman of the board of directors. In January, Angstrom-T filed for bankruptcy, as it was said in VEB, with the aim of “financial recovery of the asset”.

looks like soft re-nationalization to me. Let's see how it goes with export to China (chips for smartphones)

That ain't good. If government gives no guarantee by March 1st, VEB will shut down production.

This could end up making Russia 100% reliant on importing electronics.

Well, partially true. The other angstrem fabs exist and continue to work. But I seriously think that Mikron should just buy it out and expand into making microprocessors for various companies who contract them. Or Rostec, who can integrate it with MCST to be leading manufacturer of Elbrus processors.

This article is a good break up on Russian Reserves BReak Up including CBR and NWF etc  , It seems Russia still hold about $100 Billion in USD Reserves/T Bills so more needs to be done to reduce it 


De-dollarization of CBR reserves: more to come?

https://think.ing.com/articles/de-dollarization-of-cbr-reserves-more-to-come/


I am just secretly hoping that they increase Chinese Bills to 25 % and USD to 12- 15 % Max just to keep the transaction going.

A good discussion on Dedollarisation 





US Dollar (Symbolbild)Russia Buys Yuan Reserves: Still Long Way to Go on Ditching Dollar - Pundits

https://sputniknews.com/analysis/201901171071543542-russia-economy-intl-trade-reserves-dollar/


However, clearly the CBR is worried about possible freezing of US assets, such as Russian-owned Treasury bills, and in 2018 moved to dramatically reduce the amount of Treasury bills it holds. As it turns out, it has not sold all the Treasury bills it holds, but it has moved a large amount of them offshore to tax havens — putting them beyond the reach of the US Treasury Department's ability to sanction them.

Why cant US Treasury Department Sanction on the T Bills CBR holds in Tax Heaven Nation ? Why is this beyond reach

The MOEX index hit two records in a row as trading opened this week. It rose to 2537.47 points on Monday and closed at 2523.52 points, a historic high for the end of the trading day. On Tuesday, the index continued to surge, hitting a record 2548.78 points as of 12:39 Moscow time (09:39am GMT).

RT

"RUSSIA SLIDES TOWARDS INTERNAL POLITICAL CRISIS."

This article provides a critical look at the situation inside Russia from the Russian perspective.

Written by Vladimir K. exclusively for SouthFront

"Russia is in a complicated political and economic situation. Smoldering conflicts near its borders and the continued pressure from the US and NATO affect the situation in the country negatively. It is possible to observe the decreasing approval rating of the Russian government and President Vladimir Putin, in particular. However, this very tendency is not linked to the foreign policy course of the Kremlin. It’s the result of the recent series of ill-considered liberal-minded economic reforms, which look similar to the economic course undertaken by the Russian government in mid-1990s. For example:

The government increased the Value Added Tax amid the slowing Russian economy, especially in the industrial sector;
The government employed an unpopular pension reform increasing the retirement age;
Additionally, the population is facing an increasingly restrictive administrative pressure faced by the population: new fines and other penalties for minor violations in various fields and additional administrative restrictions limiting the freedom of actions of citizens. The traffic management of big cities and federal highways as well as policies employed towards small business and self-employed persons are among the most obvious examples.

In fact, the general population has no effective levers of pressure to impact the government policy. The public political sphere is turned into a desert. The United Russia (Edinaya Rossiya) is the only political pseudo-party, which still de—facto exists in the public politics. Nonetheless, its ideological and organization capabilities are exhausted. Other “political parties and organizations” are just media constructs designed to defend interests of a narrow group of their sponsors. It is hard to find a lawmaker in the State Duma and the Federation Council, who would not be affiliated with the established political elite or oligarchs.

In the media sphere, the government failed to explain its current course to the population. A vast majority of initiatives of Dmitry Medvedev’s cabinet faces a negative reaction among the population. A spate of scandals (example) involving high and middle level government officials made the situation even worse. They publicly revealed blatant hypocrisy, neglectful attitude to duties of some Russian officials. In the period from 2018 to 2019, there were multiple arrests of officials caught exceeding of the limits of authority and being involved in corruption schemes. In comparison to the previous periods, this number increased by 1.5-2 times. However, this does not help to change the established media situation.

The aforementioned factors fuel the negative perception of the Medvedev government, and thus Vladimir Putin as the head of state, among the Russian citizens.

The situation is also complicated in the foreign policy field. In fact, the Kremlin failed to exploit opportunities to expand its influence, which it got after the reunification of Russia with Crimea. In fact, by February 2019, the Russian policy towards eastern Ukraine has been ill-defined. At the same time, Moscow continues to lose its influence in post-Soviet states. This can be observed in both the Caucasus and Central Asia. Even, the close ally, Belarus, occasionally demonstrates unfriendly behavior and focuses own efforts on the exploitation of economic preferences granted by Russia.

Evaluating the current internal political situation in Russia and its foreign policy course, it’s possible to say that the Russian leadership has lost the clear vision of the national development and the consistent stiff policy, which are needed for any great power. Another explanation of this situation is that the Russian leadership is facing pressure from multiple agents of influence, which stand against ideas of the powerful independent state seeking to act as one of the centers of power on the global stage. One more factor, often pointed out by experts, is the closed crony-caste system of elites. This system led to the creation of the leadership, which pursues own economic and security interests only. Apparently, all of these factors influence the Russian foreign and domestic policies in one way or another.

In any case, it is highly likely that Russia will face hard times in the next two years (2019-2020) and face various threats and challenges for its economy, foreign policy course and even the statehood."


https://southfront.org/russia-slides-towards-internal-political-crisis/

This is satire, right?

It's a viewpoint article from some guy

He is rather wrong since industrial and manufacturing is still in the positives (growth). While vat tax increase is rather small (2%) bringing it to 20% for non essential goods, which brings it to standard found in ton other countries.

People make mountain out of mole hill

Finally MACRON the stabber found a way to stop Nord Stream 2 project of Russia with Germany.  

https://www.rt.com/business/450901-france-germany-nord-stream/


Honestly i really hope Not only Nord Stream 2 is canceled but also EVERY other energy project
of Russia with Europe..  (already southstream project was cancelled)  And putin "the wise" ,"the 3d chess genius"
and some likes to call him , spend a Fortune building those pipelines.. most of Russian Government debt is consequence of building those pipelines..  And Russia dependence of Oil and Gas , was the main fuel ,behind
NATO seeking to over run Syria to building a pipeline of Oil and gas from Qatar and Saudi Arabia to Europe to bypass energy business with Europe.

So as you see Europe don't like Russia.. why is that ?  
No body puts a gun on the head of any European nation to dislike Russia.. So whats going on many will say?
Why is Russia always struggling to get respect it wants from Europe and America? Why nobody in Europe wants to be in the Russian orbit ?  Ukraine population had an Euromaidan for being closer to US and EU. Venezuela is suffering ANOTHER Euro/Ameri-maidan.. to move Venezuela AWAY from Russian orbit and closer to the west.
Someone once said , Russia problem is that its culture ends at their borders.. and thats where Western Culture start.. When Russia host Olympics , it even needs to recruit American or British singers.. why is that ?

Influence = Leadership.
Russia biggest problem.. the #1 of all is a LEADERSHIP problem and influence problem.
Because even though Putin helped recover Russia economy during the first 8 years he was in power..
he transformed Russia into a nation VERY DEPENDENT on the American System.. very dependent on commodities selling Energy to Europe..   and so naturally and logically....the counter reaction for Russian enemies like US ,UK , and many others is to target Russia energy business  

So as you see EU have been for years seeking to block Russia energy business and now they found a way to
block Nord stream 2 ,since without France support Germany will not get the pipeline deal with Russia. and hopefully they do it.. that way , he will realize , rather soon than late .. that his bet on developing Russia economy
as a gas station ,like saudi arabia ,was ill advice , without developing a real Influence ,real leadership first..

Someone sooner or later will have to explain the clueless President Putin ,that if he follows the
American System , which the European Union is part of it.. that Russia will never get the respect and the
fair treatment it deserves.. Putin hoped ,that his "american partners" will allow him ,to do energy business in
peace as long he is polite and cooperate with Americans system by supporting it..

Instead if Putin had created its own System , by challenging US Business Supremacy  ,challenging US modern
culture , challenging US internet ,Challenging American Entertainment industry ,and more than anything ,if Putin from the start , dedicated all the energies and budget he have wasted in Olympics ,long time ago Russia will have
stolen the Leadership role of Americans in the world... and every new generation of citizens in most developed nations , will be looking at Russia with different eyes.. and Russia will have also attracted the best scientist in the planet.. including European towards Russia ,because everyone likes to follow a LEADER.. and nobody follows an insecure followers like Russia.  Had Putin understood how to counter the American system.. long time ago ,
Russia will had bases in the moon and mars and leading in space explorations ..  But even Rogozin exposed
this ill advice policies of Putin , how they want Roscosmos to beat NASA with 1/20 of its budget..and same with China ,with low pay engineers and scientist.. He openly complained about low funding of Russia space program..
If Putin didn't wasted $70 billions USD is meaningless sports medals contest..and instead invested in a revolutionary and incredibly ambitious dual purpose (civilian/military)space program, Russia will had the budget to totally dominate in space exploration ,and not in 50 years ,20 or 15, but by now.. but also even create a new Internet and create the modern Business Russia needs to counter the influence of the American ones.  

Things to remember.. Americans don't sanction Russia space program.. why they don't do that ?
Because they BENEFIT from it.. they need it.. So any one with basic 101 reasoning , will realize all that
Russia needs to do is promote business that are very influential ,prestigious and unique for the image of the
nation ,for reasons that nobody else can do it.. or almost no one can.  Is leadership Russia problem..
had Putin promoted instead of sports ,  promoted a modern Russian Economy , no longer base on commodities
but instead of things that the west likes..and praise.. the Russia Economy will become sanctions proof.. because
the things Russia offer , everyone likes and they don't have an alternative to it..

Russia need to eclipse NASA in space ,not just compete. and leading in space is worth every inch ,not only for bragging rights and earning respect but it will also help Russia security ,by dominating in space, dramatically. and be on headlines every month for this,, it needs a new Internet that covers world wide and Russia controls,   alternative to US computers and IT and software industry .and Russia don't need to do it alone ,it can do it with China and India help.. alternative to American entertainment industry that is extremely popular . Putin is a back ward looking president.. he looks at the past.. and try to emulate it.
the good old times and traditions.. instead of developing Russia in an unique new and modern way.
But Putin the fool.. continues with his outdated vision of hoping to get cooperation with the west ,that the west
"come back to its senses" , while showing weakness ,insecurity and dependence on the western system.
So Russia hope is the west "to change"...  when they well know they have no reason to do it.. Since Russia
lacks of leadership . So all the west needs to do to break Russia is continue creating more civil wars in countries that Russia is allied.. this is very easy to do. , A new war in venezuela ,and another in Serbia will have putin on its knees begging Americans for forgiveness.

and it can be worse in MOldova ,if they start invading transnistria that Russian soldiers protect. and then you will see Russia economy to break ,because they can't leave alone their Serbian brothers ,their armenian ones and neither can allow Russians police peace mission in transnistria to be killed too.. To see Putin governing Russia.. is like observing a man complaining he don't like the taxi he have take to travel to his job ,how he drives and how unfair is the prices needs to pay for a ride.. so another tells him.. why the hell you don't buy your own Car? and stop complaining? and he ignores this and continues saying how unfair are the taxi prices.. and how bad he drives.

 All Russia problems scream one thing.. Russia needs INDEPENDENCE. True Independence . and needs to stop following the anglo-jews system.. and needs to become a better alternative to the American business world.
Putin strategy of promoting the end of the use of dollars is retarded ,without ending the American influence first.
Neither BRICS.. what?    is going to do anything.. because again this are just a tiny little step ,but completely ignoring the source of the problem.. that US have leadership/influence and Russia not..  So without countering US business influence /business leadership.. Putin strategy will NEVER WORK.. no matter if half of the world Join BRICS.. the most developed nations will never join a nation that had no leadership and offers no strong alternative to US system. It will be funny the day Russia banned from American internet . and US consolidate its control over Europe demanding all transanctions in dollars..something they can do,  then Russia will become a toothless third rate power..  another CUba but with nukes.. Is sad to see Russia being hold back the big potential it have to become a TRUE Independent nation and powerful nation ,by the ignorance of Putin and his party. and it doesn't look that the opposition like Communist party or the liberals can rescue Russia from the  dark future that awaits Russia , because it will be impossible to stop US empire without countering their leading business influence. US can continue printing money out of thin air ..and Europeans and others will continue buying american money.. and Putin will continue complaining how unfair is the world that he have chosen to not counter and follow,so it continue to exist.

I read almost a 1/4 of the above wall, so Vann7 if you think Putin wants Russia to be dependent on oil and gas go to this link http://www.eeg.ru/pages/123. And explain how the non oil and gas balance(Budget without the revenues from those sectores) was reduced from 7,9% on 2017 to 6,2% in 2018.
The revenues from oil and gas industry jumped almost 30% in 2018.
Please explain

par far wrote:"RUSSIA SLIDES TOWARDS INTERNAL POLITICAL CRISIS."
...................
https://southfront.org/russia-slides-towards-internal-political-crisis/

Southfront are ultra nationalists

They are not satisfied with what they perceive as weakness in foreign policy

This latest article is probably inspired by their dissatisfaction over Venezuela

Just listen to this:

...Evaluating the current internal political situation in Russia and its foreign policy course, it’s possible to say that the Russian leadership has lost the clear vision of the national development and the consistent stiff policy, which are needed for any great power. Another explanation of this situation is that the Russian leadership is facing pressure from multiple agents of influence, which stand against ideas of the powerful independent state seeking to act as one of the centers of power on the global stage. ...

We now know what Vann reads when he is not watching flat-earhter videos on YouTube

The Ministry of Finance evaluated the applications for projects for the execution of Putin’s decree in May of 60 trillion rubles

https://tass.ru/ekonomika/6092819

“Economy is us”

https://www.vedomosti.ru/business/blogs/2018/12/27/790540-ekonomika-mi-vami

Infrastructure investment broke record

https://www.vedomosti.ru/economics/articles/2019/01/15/791511-rinok-infrastrukturnih-kontsessii?fbclid=IwAR2pY5lz3m8jGzBTmwQkBQ_dz-mkyo4JM7Rhfz9_e0HcU3nAA-UswWxxqFU

Save the carrots. They were allowed to store much of "their" wealth in off-shore tax heavens for the last 25 years. The interests on this money is a realy big carrot.