Russian Economy General News: #13

When the SMO is over, and interest rates find their way down as the global economy recovers

I make a prediction, that Russia will be top 5 in the world by Nominal GDP

The reason I say that, is that if you look at the trend, Russia is on the way to financializing its own economy as every other country has done

The smart thing, was that it kept its debt to GDP down before the onset of high interest rates - making its own debt service very low

But when interest rates drop, the financial playing field will look very different

Both the US and China's growth have slowed down considerably

And all European nations, will basically be deindustrialized and face long recovery after recession

Russia will be uniquely placed, to usher in slow and methodical quantitative easing, to the tune of 40% Debt to GDP, with a Nominal GDP exceeding 4 trillion USD

That would put Russia on course to pass Canada, Brazil, Italy, France, UK, and possibly Japan by 2030

Russia is uniquely poised to provide massive liquidity to VTB, Sberbank, Gazprombank, alfa bank and to essentially grow its supply chains by providing low interest loans to the SMEs which are being developed during the course of the SMO

These industries are currently training virtually the entire Russian population, there is virtually no unemployment, and they are also issuing patents and intellectual property at fast rates

Once the financial climate benefits QE, Russia can flood its middle business market with cash, and reap the rewards of its industrial productivity,

And eventually see a corporate expansion into the EAEU states

After all, this is the main goal of the leading Russian corporations

To develop the infrastructure of the Russian world

In 2019, Russia broke the record of the entire USSR for the annual production of freight cars (more than 79 thousand cars were produced, compared to 72 thousand for the entire USSR in the seventies). It also covers the level of production of freight cars in China (the maximum figure is about 66 thousand per year). Over the past 10 years, Russia has been producing from 50 thousand to 79 thousand freight cars per year.
You can compare it with production in Western economies.

franco wrote:

and how does 12 years compare re salaries?

In 2011, I had a salary of about 16 thousand rubles at the factory.
At the moment, it would be 50-60 thousand, taking into account inflation and the fall in the exchange rate.
But now the main number of vacancies is offered by 80-100 thousand plus allowances. So we can talk about a twofold increase in wages for workers (which, however, still does not compensate for the complexity and danger of working in production, since right now I earn an average of about 200 thousand working in office positions).

Not to mention if you got a job making Su-57s then you probably wouldn't be allowed to post here any more.

Glad you don't work in an Su-57 factory.

The Agency for Transformation and Economic Development (ATRE) stated that the demand for qualified personnel in the Russian economy will continue to grow at a faster pace than supply. According to experts, by 2030 the number of working-age population will increase by 3.1 million people.

However, this will not be enough not only to meet the growing demand, but even to cover the current labor shortage. In particular, today there are officially 2.3 million unfilled vacancies in the Russian Federation. , According to ATRE, the real need for workers is 1.5-2 times higher.

In this regard, current sources must be identified or new sources created to cover the ever-increasing demand for workers. According to ATRE, in order to balance the labor market it is necessary to retrain the population at a rate of up to 4.2 million people. In total, it is proposed to send up to 25 million people for retraining.

However, such a load may become unbearable for educational organizations. In addition, the question arises of sources of funding for the education of such a large number of citizens. Obviously, it makes sense to conduct targeted training at the request of specific organizations and at their expense, possibly at their sites.

https://media--mig-ru.translate.goog/indicators/dlya-pokrytiya-kadrovogo-deficita-jeksperty-predla/?utm_source=finobzor.ru&_x_tr_sl=auto&_x_tr_tl=en&_x_tr_hl=en

Russia’s current account surplus has increased sharply, propping up the national currency as energy exports recovered despite pressure from Western sanctions, the country’s central bank reported on Tuesday.

The current account, which measures the difference between money coming into the country through trade, investment and transfers against outflowing funds, amounted to $53.8 billion for the first ten months of the year, the regulator’s data showed.

The surplus exceeded $11 billion in October for the second consecutive month after reaching its highest level this year in September. The central bank revised upwards its current account projection for the full year from $45 billion to $60 billion on the back of soaring oil prices.

Moscow’s proceeds from oil and gas sales surged to their highest level in one-and-a-half years, reaching $17.7 billion last month despite forecasts of a vast deficit.

“Fresh data shows Russia continues to benefit from high commodity export revenue. We expect Russia will post another $20 billion of current account surplus in the remaining two months of 2023, bringing the overall external balance to around $75 billion,” Bloomberg’s Russia economist Alex Isakov predicted.

“Growing export revenue helped stop the ruble rout, but in the coming months Russia’s currency may be tested as the government rebuilds its FX [foreign exchange] reserves beginning in January,” he added.

This comes after Moscow rerouted the bulk of its trade flows eastwards after Western sanctions largely disrupted supply chains in European markets.

Russian authorities reimposed some capital controls requiring exporters, including major oil producers, to sell their earnings from foreign trade on the domestic market in order to secure foreign currency inflows.

The measure helped provide support to the ruble, which gained around 5% against the US dollar in October. The currency continued to strengthen this week to below 89 against the greenback for the first time since late July.

https://www.rt.com/business/587396-russia-current-account-sruplus-rise/

MOSCOW, November 20. /TASS/. Russia’s federal budget deficit will not exceed 1% of GDP in 2024-2026, Finance Minister Anton Siluanov said.

"With the current price situation maintained, the National Wealth Fund will be replenished and we will stably face budget deficit within 1% [of GDP]. If the situation changes we will adjust our projections as well," he said addressing the Federation Council (upper house of the parliament).

"Amid the challenging environment the budget was drawn up considering reaching top targets, on the one hand, and on the other hand, the budget ensures the tasks of macroeconomic stability and sustainability," the minister added.

The State Duma, the lower house of parliament, adopted earlier the law on Russia’s federal budget for 2024-2026 in the third and final reading. According to the document, federal budget revenues are projected at 35.065 trillion rubles ($393 bln) in 2024, 33.552 trillion rubles ($376 bln) in 2025, and 34.051 trillion rubles ($382) in 2026. Expenses are expected to be 36.66 trillion rubles ($411 bln), 34.382 trillion rubles ($386 bln), and 35.587 trillion rubles ($399 bln), respectively. The federal budget deficit will amount to 1.595 trillion rubles ($17.9 bln) in 2024, 0.83 trillion rubles ($9.3 bln). in 2025 and 1.536 trillion rubles ($17.2 bln) in 2026.

https://tass.com/economy/1708639

MOSCOW, November 20. /TASS/. Russia’s federal budget has already received around 40 bln rubles ($453 mln) out of the planned 300 bln rubles ($3.4 bln) on the windfall tax, Finance Minister Anton Siluanov said.

"Regarding the issue of windfall tax, we planned to raise around 300 bln rubles. Around 40 bln rubles of the amount that we planned, have been received by now. But the main payment period is November-December, so we expect the planned amount <…> to be received by the end of the year," he said addressing the Federation Council (upper house of the parliament).

Russian President Vladimir Putin endorsed earlier the law imposing a 10-percent windfall tax on large companies. The law is to take force on January 1, 2024. The tax must be paid no later than January 28, 2024, according to the document. It will be paid solely to the federal budget and will be a one-time fee, with around 300 bln rubles ($3.4 bln) worth of additional revenues expected.

https://tass.com/economy/1708645

Those nominal exchange conversions of rubles to dollars are utterly meaningless. The Russian economy does not operate on dollar-equivalent
prices. Take every one of those dollar numbers and multiply by 2.5 to get a better sense of the magnitude. But in actuality, the 2.5 is only
relevant for the civilian economy. For the military economy its over 5.

I read somewhere, I think it was in Kommersant, that they stopped granting new IDF loans because the funds were depleted. Given the high interest rates and the need to replace foreign imports, this is something that needs to be fixed.

Russia has its own analogue of neocon parasites. It is the monetarists that control the Finance Ministry and the Central Bank. They are actively suppressing
Russia's economic development with their voodoo theories.

They tap into the culture of the USSR where there was no such thing as free money (in spite of it being a "communist" state) and where simplistic pricing and
money voucher flow was established. So we have macroeconomics being subjected to microeconomics concepts of money conservation. The GDP is not
a family budget. If you impose global constraints on money supply, then you impose global constraints on growth. Perpetually tightening credit screws translates
into inability of companies to finance growth. People simply have no understanding of the difference between microeconomics and macroeconomics. I routinely
hear the mom-and-pop store "analogy" of the macroeconomy. Total, unmitigated BS.

Well, they still need to put a damper on consumer spending to cut back on imports until the local industry kicks in and starts replacing imports.
Otherwise they will just replace imports of European, Japanese, and US products with Chinese ones, at the same time their oil & gas export revenue has gone down. Especially the gas revenue. Not a good thing.

Just look at the car market. The Chinese replaced the European and Japanese brand car sales in Russia. But a lot of those foreign brand cars used to be at least assembled in Russia. The Chinese ones with the exception of Haval are all manufactured outside Russia. Chery has a car factory in Belarus. But other Chinese cars are straight out imports coming from the PRC. Car sales soared with the low interest rates and recovered to 2021 levels.

The industry cannot answer on no time. It takes two years to build a new factory, and at least one year to start serial production. A lot of foreign companies exiting Russia also haven't had their exit processes fully resolved and in the meantime those facilities are closed down.

The high interest rates on loans are supposed to put a damper on consumer spending. But for this not to affect industrial growth the IDF low interest rate loans need to be available.
So I would say the central bank is doing the right thing by increasing the interest rates. But the government needs to cushion the blow to industry of this policy with IDF loans.

The growth of tax revenues to the Russian budget by the end of 2023 will be about 9% and will reach 46 trillion rubles. These figures were announced at a meeting of Russian President Vladimir Putin with the head of the Federal Tax Service Daniil Egorov.

"Yes, by 9%. Because that year we had 42 trillion rubles for the year - the total budget, and this year it will be, respectively, 46. That is, we will have four trillion plus," Egorov explained the statistics.

He also informed the President about the high degree of automation of the collection of information on financial transactions in the country, taxes and fees, with the reflection of information in 55 million personal accounts on the website of the Federal Tax Service. This makes the tax system more transparent.

"That is, not only is it much more convenient for all participants in this process, and for the state, and mainly for taxpayers, it also leads to an increase in collection," Putin said.

Earlier it was reported that by 2025 the Federal Tax Service plans to introduce a simplified system of tax deduction for treatment and training with automated accumulation of data from clinics and educational institutions of the country, whose services are used by Russians. ■

https://tvzvezda.ru/news/202311211136-KZMxR.html

They thought cutting Russia away from the west would isolate and contain (their words) and ultimately destroy the Russian economy, but actually what it did was helped the Russians to turn away from the vampiric west and extract all the blood suckers and board members and owners of Russian trade and industry that snuck aboard during the 1990s, and to kick them out. It also allowed them to diversify away from European customers who were rich but paid discounted prices for the energy and raw materials they bought from Russia, so now Russia sells to the rest of the world closer to market values and not only makes more money but no longer has to put up with the sermons and lectures from their new customers.

This really is the best thing for Russia, but for the west it is going to be catastrophic because the rest of the world will see that Russia can survive with China and BRICS... and not just eek out an feeble existence... their economy is going well... the rest of the world is probably thinking maybe learning to speak Russian or Chinese might be more valuable and useful than learning to speak English, because there are good paying jobs in Russia in a socially conservative country that is no where near as racist as the west is.

In Moscow, the volume of production of manufacturing industries increased by 15.1

Over the nine months of this year, production increased by 15.1% compared to the same period of 2022. The most increased production of clothing — more than 3 times, electrical equipment — 2 times, medicines and medical materials — 1.5 times.

The revenue of capital manufacturing enterprises has grown by 37% in 3 years. This is 12 percentage points higher than the national average.

Today in Moscow there are more than 4 thousand industrial sites. About 760 enterprises specialize in instrument making, over 630 — in printing, about 340 — in the production of building materials. 720 thousand people are employed in production.

To develop industry, the city provides more than 20 systemic support measures. For example, the provision of soft loans, tax and rental benefits, the receipt of subsidies to reimburse part of the costs of leasing and the payment of interest on loans for the purchase of equipment. The list of support measures is constantly expanding.

Source:
Sdelanounas.ru - https://sdelanounas.ru/blogs/155714/
mos.ru - https://www.mos.ru/mayor/themes/12299/10397050/

In Russia, 24.4 thousand employees of large and medium-sized enterprises this year received salaries of 1 million rubles per month or more (before income tax), according to a FinExpertiza study based on Rosstat data (available from Izvestia). This is 43% more than in 2021.

Most of the millionaire workers were in the sphere of wholesale and retail trade (4.3 thousand people), in the manufacturing industry (3.97 thousand), in finance and insurance (3.66 thousand).

The main reason for the increase in the number of such employees is the shortage of personnel in many sectors of the economy, believes Olga Panina, head of the department of “State and Municipal Administration” of the Financial University under the Government of the Russian Federation.

“Positions such as top managers, directors of stores or chains, heads of purchasing and sales departments have always been in short supply on the labor market due to their specific nature and high level of effort,” noted Nikolai Pereslavsky, head of the “Support” department of CMS Group.

At the same time, taking into account the consumer inflation accumulated over two years (20.6%), 1 million rubles today is equivalent in purchasing power to 830 thousand rubles in 2021, FinExpertiza said.

At the same time, the authorities predict further growth in household incomes. In 2023–2026, nominal wages (that is, excluding inflation) in at least eight regions of Russia will increase by an average of 10% per year or more, the Ministry of Energy previously reported.

https://iz-ru.translate.goog/1615501/2023-12-05/rossiian-s-zarplatoi-ot-1-mln-stalo-v-15-raza-bolshe?main_click&_x_tr_sl=ru&_x_tr_tl=en&_x_tr_hl=en&_x_tr_pto=wapp

The top 35 most socially prosperous regions in Russia are headed by the Yamal-Nenets Autonomous Okrug, Nenets Autonomous Okrug and Khanty-Mansi Autonomous Okrug. They are followed by Sakhalin, Magadan regions, Moscow , Chukotka, St. Petersburg, Kamchatka Territory and Murmansk region. This is stated in a study by the Civil Society Development Fund (CSD) based on the results of the third quarter of 2023, based on Rosstat data. The document is at the disposal of Izvestia.

As its authors explain, the rating was prepared based on the ratio of average wages to the estimated minimum cost of living. The latter refers to a fixed set of food and non-food products, as well as the minimum necessary services per person per month.

The second ten of the ranking included the Irkutsk region, Yakutia, Krasnoyarsk region, Kemerovo, Moscow regions, Tatarstan, Komi, Leningrad, Amur and Tyumen regions.

The third group included the Sverdlovsk region, Belgorod and Tomsk regions (shared 22nd place), Chelyabinsk region, Bashkiria, Transbaikal region, Astrakhan and Samara regions, Perm region, as well as Tula, Novgorod and Omsk regions (shared 30th place).

The study is completed by the Novosibirsk and Arkhangelsk regions (31st place), Khabarovsk Territory and Lipetsk region (32nd place), Khakassia, Kaluga and Orenburg regions.

https://iz-ru.translate.goog/1615496/2023-12-05/v-rossii-nazvali-top-35-blagopoluchnykh-regionov?main_click&_x_tr_sl=ru&_x_tr_tl=en&_x_tr_hl=en&_x_tr_pto=wapp

They earn the most per month in Chukotka – 141 thousand rubles, in the Yamal-Nenets Autonomous Okrug – 140 thousand, in Moscow – 122 thousand and in Kamchatka – 121.5 thousand rubles. Almost the same regions have the highest expenses: Chukotka - 35.2 thousand rubles, Kamchatka - 32.6 thousand and Moscow - 30.3 thousand rubles. This is stated in a study by the Civil Society Development Fund (CSD) based on the results of the third quarter of 2023, based on Rosstat data. The document is at the disposal of Izvestia.

As noted in ForGRO, the average monthly salary in Russia as a whole as of September 1, compared to the corresponding period last year, increased by 16% - from 59.9 to 69.4 thousand rubles. At the same time, the average cost of living over the same period increased by 6.3% – from 19.9 to 21.1 thousand rubles.

“Compared to the results of the second quarter, the most noticeable changes (over five positions) for the better were demonstrated by the Belgorod region, which rose from 30th to 22nd place. Moscow and St. Petersburg are still in the top ten. At the same time, Moscow moved from eighth place to sixth, and St. Petersburg from ninth to eighth. It’s interesting that both the Moscow (15th place) and Leningrad (18th place) regions remained in their previous positions compared to the second quarter,” Konstantin Kostin, head of the ForGGO, told Izvestia.

At the same time, he reported that in the third quarter there was a slight decrease in the social well-being index, primarily among leaders.

“Based on the results of the second quarter, the maximum index value was 7.5 (Yamalo-Nenets Autonomous Okrug), the minimum was 1.86. This was primarily influenced by the level of average salaries, their surge primarily in resource-producing regions,” explained Konstantin Kostin.

https://iz-ru.translate.goog/1615497/2023-12-05/nazvany-regiony-rossii-s-naibolshei-zarplatoi?main_click&_x_tr_sl=ru&_x_tr_tl=en&_x_tr_hl=en&_x_tr_pto=wapp

shit, it may become better for me to move to Russia to work.