Economy of Russia

From Wikipedia, the free encyclopedia (Redirected from Economy of russia) This article may require cleanup to meet Wikipedia's quality standards. (Consider using more specific clean up instructions.) Please improve this article if you can. The talk page may contain suggestions. (February 2011) This article needs additional citations for verification. Please help improve this article by adding reliable references. Unsourced material may be challenged and removed. (July
2011)

This article is outdated. Please update this article to reflect recent events or newly available information. Please see the talk page for more information. (July 2011)

Economy of Russia

Rank Currency Fiscal year Trade organizations GDP GDP growth GDP per capita GDP by sector Inflation (CPI) Population below poverty line Labour force

11th (nominal) / 6th (PPP) Russian ruble (RUB) calendar year CIS, APEC, EURASEC, G-20, G8 and others Statistics $1.465 trillion (2010) (nominal; 10th)[1] $2.222 trillion (2010) (PPP; 6th)[2] 4.9% (2011 est.) [3] $10,521 (2010) (nominal; 54th)[1] $15,807 (2010) (PPP; 51st)[1] agriculture: (4.2%), industry (33.8%), services (62%) (2010 est.) 6.7% (2010 est.)[4] 13 % (2010 est.) 75.55 million (2010 est.)

Labour force by occupation Unemployment Average net salary

agriculture (10%), industry (31.9%), services (58.1%) (2008) 6.7% (November 2010 est.)[5] 700 $, monthly (2010)[6]

complete range of mining and extractive industries producing coal, oil, gas, chemicals, and metals; all forms of machine building from rolling mills to high-performance aircraft and space vehicles; defense industries including radar, missile production, and advanced electronic components, Main industries shipbuilding; road and rail transportation equipment; communications equipment; agricultural machinery, tractors, and construction equipment; electric power generating and transmitting equipment; medical and scientific instruments; consumer durables, textiles, foodstuffs, handicrafts Ease of Doing 123rd[7] Business Rank External Exports $376.7 billion (2010 est.) petroleum and petroleum products, natural gas, metals, wood and wood products, Export goods chemicals, and a wide variety of civilian and military manufactures Netherlands 10.62%, Italy 6.46%, Germany Main export 6.24%, China 5.69%, Turkey 4.3%, Ukraine partners 4.01% (2009) Imports $237.3 billion (2010 est.) machinery, vehicles, pharmaceutical products, plastic, semi-finished metal products, meat, Import goods fruits and nuts, optical and medical instruments, iron, steel Main import Germany 14.39%, China 13.98%, Ukraine partners 5.48%, Italy 4.84%, US 4.46% (2009) Gross external $471.6 billion (2010 est.) debt Public finances Public debt 9.5% of GDP (2010 est.) Revenues $202.7 billion (2009 est.) Expenses $301.4 billion (2009 est.) Credit rating • Standard & Poor's:[8] BBB+ (Domestic) BBB (Foreign) BBB (T&C Assessment)

with notable exceptions in the energy and defense-related sectors. As of 2011. Russia experienced the first recession after 10 years of rising economy. the rapid privatization process. Moscow.1. coal.[1] Russia has an abundance of natural gas. unless otherwise stated. Despite the deep but brief recession. It is also rich in agriculture. Economic reforms in the 1990s privatized most industry. moving from a centrally planned economy to a more market-based and globally integrated economy. Nonetheless. Russia has undergone significant changes since the collapse of the Soviet Union. including a much criticized "loans-for-shares" scheme that turned over major state-owned firms to politically connected "oligarchs". largely because of the integration of short-term macroeconomic policies that helped the economy survive. has left equity ownership highly concentrated.Outlook: Stable[9] • Moody's:[9] Baa1 Outlook: Stable Fitch:[9] BBB Outlook: Positive • Foreign reserves US$502. the economy has not been as seriously affected by the global financial crisis compared to much of Europe.496 billion (April 2011)[10] Main data source: CIA World Fact Book All values.1 Putin years . now has the highest billionaire population of any city in the world. oil. Russia's capital.1 Recovery  1.[citation needed] Contents [hide] • 1 Economic history ○ 1.[citation needed] In late 2008 and early 2009. are in US dollars GNI per capita: Russia (9 370$) Higher GNI per capita compared to Russia Lower GNI per capita compared to Russia The economy of Russia is the eleventh largest economy in the world by nominal value and the sixth largest by purchasing power parity (PPP). until the stable growth resumed in late 2009 and 2010. and precious metals.

1.1.8 Construction market 6. • ○ ○ ○ • • • 1. The former .4 Automotive industry 5.2 Post-Putin years 2 Macro economy 2.3 Space industry 5.1 Gross domestic product 2.2 Stocks • 10 References [edit] Economic history Main article: Economic history of the Russian Federation The two fundamental and independent goals – macroeconomic stabilization and economic restructuring – are transition from central planning to a market-based economy.1.2 Monetary policy 2.2 Aircraft industry 5.7 Transportation 5.2 Mergers and acquisitions 6 Investment 7 Statistics 8 Types of legal entities in Russia 9 See also ○ ○ 9.1 Strategic sectors 6.3 Agriculture 5.5 Electronics ○ ○ ○ ○ ○ ○ ○ • ○ ○ • • • 5.1 External links 9.4 Trade 5.1.3 Fiscal policy 3 Law 4 Natural resources 5 Sectors ○ 5.1 Defense industry 5.5 Information technology 5.2 Telecommunications 5.1 Industry      5.6 Nanotechnology 5.1.1.

even though its population made up just half of the population of the USSR at the time of its dissolution.[citation needed] The largest state enterprises were controversially privatized by President Boris Yeltsin to insiders[15] for far less than they were worth. and commercial legal codes— that permit the economy to operate efficiently. [citation needed] Since the collapse of the Soviet Union in 1991. violent criminal groups often took over state enterprises. there were corporate raiders such as Andrei Volgin engaged in hostile takeovers of corrupt corporations by the mid-1990s.[12] Hyperinflation resulted from the removal of Soviet price controls and again following the 1998 Russian financial crisis. was an important aid in reaching these goals. as recommended by the United States and IMF. clearing the way by assassinations or extortion. the Yeltsin government of the Russian Republic had begun to attack the problems of macroeconomic stabilization and economic restructuring.[citation needed] [edit] Recovery Russian public debt . market-oriented reform along the lines of "shock therapy". and these new publicly traded companies were quickly handed to the members of Nomenklatura or known criminal bosses.entailed implementing fiscal and monetary policies that promote economic growth in an environment of stable prices and exchange rates. Russia has tried to develop a market economy and achieve consistent economic growth.[14] That being said. The Gorbachev regime failed to address these fundamental goals. and institutional entities – banks. the oligarchs wielded significant political influence. the director of a factory during the Soviet regime would often become the owner of the same enterprise. this policy resulted in economic collapse. with millions being plunged into poverty and corruption and crime spreading rapidly. private property.[13] When once all enterprises belonged to the state and were supposed to be equally owned amongst all citizens. who became immensely rich.[16] Through their immense wealth. Corruption of government officials became an everyday rule of life. The latter required establishing the commercial. Yeltsin announced that Russia would proceed with radical. For example. Under the government's cover. Stocks of the stateowned enterprises were issued. During the same period. At the time of the Soviet Union's demise. outrageous financial manipulations were performed that enriched the narrow group of individuals at key positions of the business and government mafia. they fell into the hands of a few.[11] However. Assuming the role as the continuing legal personality of the Soviet Union. the results were mixed. thus linking the economy with the rest of the world. Many took billions in cash and assets outside of the country in an enormous capital flight. In October 1991.[11] Many Russians consider these infamous "oligarchs" to be thieves. Opening domestic markets to foreign trade and investment. Russia took up the responsibility for settling the USSR's external debts. By mid-1996.

however. Lower prices for Russia's major export earners (oil and minerals) and a loss of investor confidence due to the Asian financial crisis exacerbated financial problems. and some of the private sector debt may already have been repurchased. the debt has risen to $19 billion due to higher Ministry of Finance and Eurobond payments. Now the Stabilization fund of the Russian Federation is being modernized. Large current account surpluses have brought a rapid appreciation of the ruble over the past several years. Russia continues to explore debt swap/exchange opportunities. Retrieved 2 August 2007. and the threat of runaway inflation. inflation has been moderate.[citation needed] On 1 January 2004.1%. $10 billion would come from the United States and $10 billion from other G-8 countries over 10 years. The FY 2002 Russian Government budget assumes payment of roughly $14 billion in official debt service payments falling due. The first part will become a reserve fund equal to 10 percent of GDP (10% of GDP equals to about $200 billion now). and will be invested in a similar way as the Stabilization Fund. Oil and gas dominate Russian exports. As of 2009 real GDP increased by the highest percentage since the fall of the Soviet Union at 8. so Russia remains highly dependent upon the price of energy. $1 billion of this has been prepaid. During 2000–01. and current account surpluses.[citation needed] Russia. This has meant that Russia has given back much of the terms-of-trade advantage that it gained when the ruble fell by 60% during the debt crisis. delayed payments on sovereign and private debts. In 2007 the World Bank declared that the Russian economy had achieved "unprecedented macroeconomic stability". [edit] Putin years . Difficulties in implementing fiscal reforms aimed at raising government revenues and a dependence on short-term borrowing to finance budget deficits led to a serious financial crisis in 1998. The result was a rapid decline in the value of the ruble.[17] Russia is making progress in meeting its foreign debts obligations. Maxim. The second part will be turned into the National Prosperity Fund of Russian Federation. However.[citation needed] In 2003. Russia not only met its external debt services but also made large advance repayments of principal on IMF loans but also built up Central Bank reserves with government budget. Deputy Finance Minister Sergei Storchak estimates it will reach 600–700 billion rubles by 1 February 2008. the Stabilization fund of the Russian Federation was established by the Government of Russia as a part of the federal budget to balance it if oil price falls. a breakdown of commercial transactions through the banking system. Under the proposed deal. flight of foreign investment. the ruble remains stable. The National Prosperity Fund is to be invested into more risky instruments. "Stabilization Fund to Be Converted into National Prosperity". including the shares of foreign companies.The Russian economy underwent tremendous stress as it moved from a centrally planned economy to a free market system. leaders of the eight nations signed a statement agreeing to explore cancellation of some of Russia's old Soviet debt to use the savings for safeguarding materials in Russia that could be used by terrorists. Shyhkin. appears to have weathered the crisis relatively well. [citation needed] In the June 2002 G8 Summit. and investment began to increase again. The Stabilization Fund will be divided into two parts on 1 February 2008. Loan and deposit rates at or below the inflation rate inhibit the growth of the banking system and make the allocation of capital and risk much less efficient than it would be otherwise. trade.

7%. 2001: 5. and in 2007 the inflation exceeded that of 2006.[22][23] and during that same time period. Payments from the fuel and energy sector in the form of customs duties and taxes accounted for nearly half of the federal budget's revenues. an increase of 7 times. In 2007. The economy made real gains of an average 7% per year ( 1999: 6. 2004: 7.5%.Russian economy since fall of the Soviet Union.[citation needed] During Putin's eight years in office. 2005: 6.5%.7% of the GDP in 2007.2%. Under the presidency of Vladimir Putin Russia's economy saw the nominal Gross Domestic Product (GDP) double. Real incomes more than doubled and the average salary increased eightfold from $80 to $640.4%.[18] The Russian economy is still commodity-driven despite its growth. The income differentiation ratio shows that the 10% of Russia's rich live increasingly better than the 10% of the poor.2%. climbing from 22nd to 11th largest in the world. The large majority of Russia's exports are made up by raw materials and fertilizers.[18] On a per capita basis. 2000: 10%.[26] There is also a growing gap between rich and poor in Russia. 2008: 5. the middle class grew from 8 million to 55 million.[18] although exports as a whole accounted for only 8.2% ). industry grew by 75%.[19][20][21] The volume of consumer credit between 2000–2006 increased 45 times. Russia's GDP exceeded that of 1990. continuing an upward trend at the beginning of 2008. investments increased by 125%. The number of people living below the poverty line also decreased from 30% in 2000 to 14% in 2008. 2002: 4. making Russians 38th richest on both a purchasing power and nominal basis. 2006: 8. Between 2000–2007 the incomes of the rich grew from approximately 14 times to 17 times larger than the incomes of the poor. (See: Gini Coefficient)[citation needed] . 2003: 7.9%. meaning it has overcome the devastating consequences of the recession in the 1990s. 2007: 8. Between 1999–2007 inflation was kept at the forecast ceiling only twice.919 per individual in 2009. as the government failed to contain the growth of prices.[18][24][25] Inflation remained a problem however. compared to 20% in 2000. Russian GDP was US$14.[18] and agricultural production and construction increased as well. making it the 6th largest economy in the world in GDP(PPP).3%. amongst whom are mostly pensioners and unskilled workers in depressive regions.

and the reversal of capital flows from $80 billion of in-flows to $130 billion in out-flows have all served to crush fledgling Russian economic growth. a decrease in access to financing with an increase in sovereign and corporate bond spreads. as well as the upcoming MS21 project to compete with Boeing and Airbus. and GDP had shrunk 9% year to year. though. and Moscow now boasts the highest billionaire population. industrial production was down almost 16% year to year. The space launch industry is now the world's second largest behind the European Ariane 5 and nuclear power plant companies are going from strength to strength. fixed capital investment was down 15. [edit] Post-Putin years See also: 2008–2009 Russian financial crisis Arms sales have increased to the point where Russia is second (with 3/5ths the amount of US arms sales) in the world in sale of weapons. Russia is now the world's third biggest destination for outsourcing software behind India and China. Responses to the recovery has been fast – Industrial Production growth remains one of the highest in the world. the IT industry has recorded a record year of growth concentrating on high end niches like algorithm design and microelectronics.[citation needed] The civilian aerospace industry has developed the Sukhoi Superjet. Oil prices dropped from $140 per barrel to $40 per barrel. ahead of New York City. and recently signed a joint venture with Toshiba to develop cutting edge power plants.5 percent on a quarterly basis indicating the beginning of economic recovery.5% year to year. in the second quarter the GDP rose by 7. However.[citation needed] The recent global economic downturn hit the Russian economy hard. resulting in three major shocks to Russia's long-term economic growth. Billionaires have grown vastly. selling plants to China and India. and deficient infrastructure pose as serious challenges for the Russian economy. a shrinking and aging population.[27] However. In January 2009.Unemployment Rate Of Russia Since the Fall of the Soviet Union. corruption.[citation needed] [edit] Macro economy [edit] Gross domestic product .

unemployment in Russia was at 5.13 Rubles 2005 21. the International Monetary Fund estimates that Russia's gross domestic product (nominal) will grow from its 2007 value of $1.3% compared to 2006.[citation needed] As of 2005. increased by 8.1% in 2007 compared to 2006.27 Rubles 2008 39. Continued average inflation of approximately 10% and strict government budget led to the growth.63 Rubles only. Average wages in 2007 hover around $42–51 per day. As of November 2007.305.[30] [edit] Monetary policy .998 million by 2013.952. Combined unemployment and underemployment may exceed those figures.500 4.4% in 2000.665.55 Rubles 2000 7. a 168% increase.000 28.600 28. 2008 (thousands US dollars): 50 000 and over 30 000 – 50 000 20 000 – 30 000 9 750 (Russian average) – 20 000 7 500 – 9 750 5 000 – 7 500 3 000 – 5 000 under 3 000 This is a chart of trend of gross domestic product of Russia at market prices estimated by the International Monetary Fund with figures in millions of Russian Rubles.[citation needed] As of April 2008. estimated at $1. oil industry and related services account for at least 40 per cent of the gross domestic product of Russia.952.52 Rubles 2009 39.177 23.177 30.20 Rubles For purchasing power parity comparisons.250 billion at 2007 exchange rates.462.289. the US Dollar is exchanged at 13.087.[29] down from 10. while lower oil prices and ruble appreciation slowed it.582 million to $3.428. driven by investment growth and private consumption demand.815 to $3.330. Industrial output in 2007 grew by 6. Russia's GDP.GRP per capita. which would make it the second largest economy in Europe in terms of purchasing power.[28] Year Gross Domestic Product US Dollar exchange 1995 1.623 in the same time.9%. Its GDP PPP is estimated to grow from $2.

On the positive side. As of June 2002. changes in government administration increased the power of the central government to compel localities to enforce laws. Government decisions affecting business have often been arbitrary and inconsistent. Much of this growth. much of it for public-sector salary increases. and legal enforcement of private business agreements is weak. taxation and business regulations are unpredictable. During 2000 and 2001.6% slightly below the 20. The 2007 budget law corporates a 25% increase in spending. The overall budget surplus for 2001 was 2. Fiscal policy has been very disciplined since the 1998 debt crisis. as they would cause the ruble to continue to appreciate and make Russian exports less competitive. Progress has been made on pension reform and reform of the electricity sector. down from 29. In 2001. pension increases and social programmes. high oil prices also would have negative economic effects.5 rubles/dollar.The exchange rate stabilized in 1999. will increase by 85 billion roubles over the 2006 figure to 230 billion rubles. Combined they come to about 38% of GDP.[31] [edit] Fiscal policy Central and local government expenditures are about equal. allowing for the first time in history for the next year's budget to be calculated with a surplus (1. which exceeded most expectations for the third consecutive year. Russian businesses are increasingly turning to the courts to resolve disputes. inflation has declined steadily. Low oil prices would mean that the Russian economy would not achieve its projected growth.4% of GDP. This trend in legislation is continued through 2002. Cumulative consumer price inflation for 2001 was 18. By 2009.[citation needed] [edit] Law Lack of legislation and. where there is legislation.63% of GDP).2 rubles/dollar the year before. with the new corporate tax code going into effect. after falling from 6. The passage of an improved bankruptcy code in January 1998 was one of the first steps. the exchange rate was 31. the estimated inflation rate had decreased to 11.[citation needed] [edit] Natural resources . lack of effective law enforcement. in many areas of economic activity is a pressing issue.2% inflation rate of the previous year but above the inflation target set in the 2001 budget. Spending on education is targeted to increase by 60% relative to the 2006 legislation and spending on healthcare is to increase by 30%. Nonetheless. Funding for the four "national projects". Crime has increased costs for both local and foreign businesses.7%. the most critical legislation was a deregulation package. After some large spikes in inflation following the August 1998 economic crisis.5 rubles/dollar in August 1998 to about 25 rubles/dollar by April 1999. was driven by consumption demand. education. Attitudes left over from the Soviet period will take many years to overcome. particularly since Russia's planned budgets through 2005 assume that oil prices will steadily increase. The Central Bank's accumulation of foreign reserves drove inflation higher and that trend is expected to continue. one year later it had further depreciated only to about 28. undertakings in agriculture. Analysts remain skeptical that high rates of economic growth will continue. the Duma passed legislation for positive changes within the business and investment sector. housing and healthcare.4 rubles/dollar. However.

some gas deposits of federal importance that are handed over for prospecting and developing the mineral resources under a joint license. The Russian fishing industry is the world's fourth-largest. It has the second largest coal reserves. staking a claim to energy sources right up to the North Pole. while Canadian officials stated the expedition was just a public show. and believing the area contains large reserves of untapped oil and natural gas.[citation needed] .[citation needed] The petroleum industry in Russia is one of the largest in the world. some sections of the mineral resources of federal importance that are situated in Russia and stretch out on its continental shelf. behind Japan. Oil and gas exports continue to be the main source of hard currency. coal.[citation needed] Expecting the area to become more accessible as climate change melts Arctic ice. the eighth largest oil reserves.[32] Under the Federal Law "On Continental Shelf Development" upon proposal from the federal agency managing the state fund of mineral resources or its territorial offices the Russian government approves the list of some sections of the mineral resources that are passed for development without any contests and auctions. Ninety percent of Russian exports to the United States are minerals or other raw materials. especially oil and gas. the United States. Russia has the largest reserves. on 2 August 2007. and is the largest exporter of oil. and timber reserves of Siberia and the Russian Far East make Russia rich in natural resources.[citation needed] Natural resources. planted the Russian flag on the Arctic seabed.Oil and natural gas pipelines in Europe The mineral-packed Ural Mountains and the vast oil. and China. However. dominate Russian exports. in submersibles. Reaction to the event was mixed: President Vladimir Putin congratulated the explorers for "the outstanding scientific project". gas. and is the largest exporter. some sections of federal importance of the Russian continental shelf. of natural gas. most such resources are located in remote and climatically unfavorable areas that are difficult to develop and far from Russian ports. Russia is also a leading producer and exporter of minerals and gold. The Russian government is also empowered to decide on the handover of the foresaid sections of the mineral resources for development without any contests and auctions. Russian explorers.

5 – 3 million people. years of low investment continue to leave their mark on the industry's capabilities and a lot of its equipment is in need of modernization. 1992–2010 Russia is one of the most industrialized of the former Soviet republics. The production and value of the military aircraft branch far outstrips other defense industry sectors. armored personnel carriers and infantry fighting vehicles.857 people. In 2009. battle tanks.[edit] Sectors [edit] Industry Russia's industrial growth per year (%). emerged from a deep crisis caused by the dissolution of the Soviet Union.[33] Russia is the world's second largest conventional arms exporter after the United States.[34] The research organization Centre for Analysis of Strategies and Technologies ranked the air defense system producer Almaz-Antey as the industry's most successful company in 2007.[citation needed] Besides its resource-based industries.300 people. Russia has developed large manufacturing capacities. The Russian aircraft industry offers a portfolio of internationally competitive military aircraft such as MiG-29 and Su-30.[citation needed] [edit] Defense industry Main article: Defense industry of Russia Russia's defense industry employs 2. while new projects such as the Sukhoi Superjet 100 are hoped to revive the fortunes of the civilian aircraft segment. notably in machinery.[35] [edit] Aircraft industry Main article: Aircraft industry of Russia Aircraft manufacturing is an important industry sector in Russia. However. followed by aircraft-maker Sukhoi. helicopters. companies belonging to the United Aircraft Corporation delivered 95 new fixed-wing aircraft to its customers. air defense systems. It is one of the most science-intensive hi-tech sectors and employs the largest number of skilled personnel. The defense and aircraft industries are important employers and are able to offer internationally competitive products for export.122 billion. and aircraft products make up more than half of the country's arms exports. Russia's industry. due to increasing demand and improved state finances. the industry produced over 141 helicopters.[34] The most popular types of weaponry bought from Russia are Sukhoi and MiG fighters. including 15 civilian models. In the 2000s. accounting for 20% of all manufacturing jobs. employing around 355.[36] . and it had a work force of 81. In addition. Almaz-Antey's revenue that year was $3.

[edit] Space industry Main article: Space industry of Russia Space industry of Russia consists of over 100 companies and employs 250.[38][39] An example of a successful Russian consumer electronics company is Telesystems. chief government and regulatory affairs officer of the GSM Association stated: . Largest satellite developer is Reshetnev Information Satellite Systems.[citation needed] [edit] Telecommunications Main article: Telecommunications in Russia Russia's telecommunications industry is growing in size and maturity. there were more than 300 BWA operator networks. Leading launch vehicle producers are Khrunichev and TsSKB Progress.000 people or 1% of the country's total work force. The largest companies are light vehicle producers AvtoVAZ and GAZ. the main manned space flight contractor.[citation needed] [edit] Electronics Russia is experiencing a regrowth of Electronics and Microelectronics.[41] In December 2006. down from 1.[citation needed] [edit] Automotive industry Main article: Automotive industry in Russia A Lada Kalina Super 1600. and Broadband Fixed Access accounting for the remaining 65%. As of 31 December 2007. Lada is the brand of AvtoVAZ. In addition. directly employing around 600. painted in khokhloma national ornaments. Russia was the world's 15th largest car producer in 2010. accounting for 5% of market share. the largest Russian car manufacturer in the Russian automotive industry. 11 foreign carmakers have production operations or are constructing plants in Russia. there were an estimated 4.807 light vehicles. with dial-up accounting for 30%.000 people.[37] The largest company of the industry is RKK Energia. Tom Phillips.898 in 2008 due to the global financial crisis. In 2009 the industry produced 595.469. the industry supports around 2– 3 million people in related industries. while KAMAZ is the leading heavy vehicle producer.[40] Over 72% of the broadband lines were via cable modems and the rest via DSL.900.[citation needed] In 2006. with the revival of JCS Mikron. while NPO Lavochkin is the main developer of interplanetary probes. and accounts for about 7% of the worldwide production. whose products are sold in over 20 countries. Automotive production is a significant industry in Russia.000 broadband lines in Russia.

caused a sharp reduction of the investments by the business sectors and a notable reduction of IT budget made by government in 2008–2009. In the first quarter of 2002.[citation needed] [edit] Trade Russian current account due to trade surplus In 1999. Following the breakup of the Soviet Union in 1991 and after nearly ten years of decline. the trend shifted. the trade surplus ballooned to $33.the IT market in Russia in 2009 declined by more than 20% in ruble terms and by one third in euro terms. On the import side. World prices continue to have a major effect on export performance. while imports slumped by 30. respectively. as exports declined while imports increased. Private farms and garden plots of individuals account for over one-half of all agricultural production."[42] While there is a lot of interest in a national broadband network.[citation needed] Most analysts predicted that these trade trends would continue to some extent in 2002. The new land code passed by the Duma in 2002 should speed restructuring and attract new domestic investment to Russian agriculture. and aircraft) and an import licensing regime for alcohol still restrain demand for imports. particularly oil.[44] [edit] Agriculture Main article: Agriculture in Russia Russia comprises roughly three-quarters of the territory of the former Soviet Union. metals. a 20% value-added tax and excise taxes on imported goods (especially automobiles.[43] The financial crisis. which had already hit the country at the end of 2008.5%. the biggest share of the Russian IT market still belongs to hardware. In 2001. Frequent and unpredictable changes in customs regulations also have created problems for foreign and domestic traders and . increased by goods and a rapid rise of travel expenditure. declining 7. as of January 2007 there still wasn't one. Restructuring of former state farms has been an extremely slow process. As a consequence. The combination of import duties."Russia has already achieved more than 100% mobile penetration thanks to the huge popularity of wireless communications among Russians and the government's good work in fostering a market driven mobile sector based on strong competition. alcoholic beverages. Ferrous metals exports suffered the most in 2001. As a consequence. steel and grains dropped by 11% and 61%. Among the particular segments. and timber comprise 80% of Russian exports. Russian agriculture begun to show signs of improvement due to organizational and technological modernization. more than double the previous year's level. and the southern parts and western Siberia produce grain.2 billion. since commodities. Northern areas concentrate mainly on livestock. natural gas.5%. import expenditures were up 12%. exports were up slightly.

9% [1]. an increase of 37. During the same time.[citation needed] Foreign trade rose 34% to $151.1 billion in 2005.13 billion.[citation needed] [edit] Information technology .[citation needed] Chinese imports from Russia are mainly those of energy sources.8% and Asia-Pacific Economic Community 15.4%. a trend since 2000. such as crude oil. Trade with CIS countries is up 13. Trade with the EU forms 52.[citation needed] China now has over 750 investment projects in Russia. involving $1. mainly due to the increase in oil and gas prices which now form 64% of all exports by value. and electricity exports from neighboring Siberian and Far Eastern regions. exports were down 10% as falling income from goods exports was partly compensated for by rising services exports.5 billion in the first half of 2005. and Russian power companies are building some of its hydropower stations with a view of future exports to China. China’s export of high-tech products to Russia increased by 58%.2% to $23. growing 35% and accounting for nearly 20% of the total trade. as Russia opened the Eastern Siberia–Pacific Ocean oil pipeline's branch to China. China’s export of machinery and electronic goods to Russia grew 70%. which is mostly transported by rail. In the first quarter of 2002.[citation needed] Russia is China’s eighth largest trade partner and China is now Russia’s fourth largest trade partner.05 billion.1% compared with 2004. The trade surplus decreased to $7 billion from well over $11 billion the same period last year. Most of China’s exports to Russia remain apparel and footwear.investors. Eurasian Economic Community 7. which is 24% of China’s total export to Russia in the first 11 months of 2005.3 billion. with the CIS 15. Also in this time period border trade between the two countries reached $5. Exports of both of these commodities are increasing.[citation needed] China’s contracted investment in Russia totaled $368 million during January–September 2005. In March 2002. Russian exports in 2006 Trade volume between China and Russia reached $29. Russia placed a ban on poultry from the United States.9%. twice that in 2004. and that is 7% of China’s total exports to Russia.

Tumen. which accounts for 28. Such growth of software outsourcing in Russia is caused by a number of factors. which have intensified their software development activities and opened their R&D centers in Russia.8 billion in 2006 [3]. Kaluga. The Putin government has announced a massive $7 billion investment program in nanotechnology. Boeing. Currently Russia controls 3 percent of the offshore software development market and is the third leading country (after India and China) among software exporters. The biggest sector in terms of revenue is system and network integration. Novosibirsk. Rosnanotech. including alternative energy and nanotechnology. growing by 54% in 2006 alone. that will be responsible for overseeing and coordinating research in the area. Meanwhile the fastest growing segment of the IT market is offshore programming.Russia has more academic graduates than any other country in Europe The IT market is one of the most dynamic sectors of the Russian economy. Market analysts predict this indicator to increase tenfold by 2010 [4].[46] Apart from public funding. The downturn served to emphasise the importance of the government to the construction market. Russian software exports have risen from just $120 million in 2000 to $1.[47] [edit] Investment See also: Timeline of largest projects in the Russian economy . Another factor stimulating the IT sector growth in Russia is the presence of global technology corporations such as Intel.8% reduction recorded by the industry for the first three quarters of 2010 looks remarkably healthy in comparison with the 18. Mikhail Prokhorov. $5 billion is being invested into a new state corporation.[citation needed] In criticism of the initiative. has announced the creation of a $17.5 billion in 2006. during 2007. a leading Russian metals and banking tycoon. The most successful of them have concluded contracts worth billions of dollars and are planning to take on employees and purchase new building machinery. Motorola. in seven different places around the country: Moscow.3% of the total market revenues [2].[citation needed] [edit] Nanotechnology In its push to diversify Russia's research and development in emerging technologies. The Government has launched a program promoting construction of IT-oriented technology parks (Technoparks) – special zones that have an established infrastructure and enjoy a favorable tax and customs regime. Nizhny Novgorod. Nortel and others. Peterburg Regions. it has been noted that the Russian nanotech program will receive three times more state funding than the rest of Russia's scientists put together. Republic of Tatarstan and St. The 0. Sun Microsystems.[citation needed] [edit] Transportation Main articles: Transport in Russia and Russian Railways [edit] Construction market Russian construction industry has survived its most difficult year for more than a decade.5 billion holding company that will focus on high-tech investments. The industry of software development outsourcing crossed the mark of $1 billion of total revenues in 2005 and reached $1. and construction firms are now much more optimistic about the future than they were just a few months ago. One of them is the supporting role of the Russian Government.4% slump recorded last year. Since the year 2000 the IT market has demonstrated growth rates of 30–40 percent a year.[45] As part of the program.

In March 2002. Banks still perceive commercial lending as risky. capital flight seems to have slowed. loans are still only 40% of total bank assets. with an almost 30% increase in total foreign investments in 2001 compared to the previous year. the first such growth since 1990. The Central Bank of Russia reduced its refinancing rate five times in 2000. and the trust of the population that it would need to attract substantial savings and direct it toward productive investments.S. Foreign investment in Russia is very low. and some banks are inexperienced with assessing credit risk. Sergei Ignatyev replaced Viktor Gerashchenko as Chairman of the Russian Central Bank. Interest on deposits and loans are often below the inflation rate.[citation needed] Money on deposit with Russian banks represents only 7% of GDP.[citation needed] Foreign direct investment. estimated at about $15 billion annually.Oil price records. During the years of recovery following the 1998 debt crisis. from 55% to 25%. more than twice the amount from the previous year. which lacks the resources. the positive outlook for sales. Higher retained earnings. Foreign portfolio investment. the capability.5%. two important channels for capital flight from Russia in recent years. Over the medium-to-long term. and political stability have contributed to these favorable trends. increased cash transactions.[citation needed] A significant drawback for investment is the banking sector. but decreased in 2001 by about 10%. rose slightly in 1999 and 2000. signaling its interest in lower lending rates. The poorly developed banking system makes it difficult for entrepreneurs to raise capital and to diversify risk. Under his . Russian companies that do not invest to increase their competitiveness will find it harder either to expand exports or protect their recent domestic market gains from higher quality imports. Russia's banks contribute only about 3% of overall investment in Russia. Investment growth has continued at high rates from a very low base. decreased dramatically in 1999. Sberbank receives preferential treatment from the state and holds 73% of all bank deposits. prompt higher FDI inflows In 1999. which includes shares and securities. investment in Costa Rica. Inward investment from Cyprus and Gibraltar. but has experienced significant growth since then. sources of about $4 billion are about the same as U. Cumulative investment from U. which includes contributions to starting capital and credits extended by foreign co-owners of enterprises. investment increased by 4. In 2001. Inward foreign investment during the 1990s was dwarfed by Russian capital flight. While ruble lending has increased since the August 1998 financial crisis. foreign portfolio investment was $451 million.S. suggest that some Russian money is returning home.

[citation needed] [edit] Statistics Retail sales in Russia[49] Year 2002 2003 2004 2005 2006 2007 Total retail sales (RUB tr) 3.2 Telecommunications market growth rate (%) 32.38 30. were implemented.04 8. compared to 2009 this was an increase of 12%.[citation needed] [edit] Strategic sectors In the Russian law as in the law of many other civilized countries.834 mergers and acquisitions with a total known value of 613 bil.2 11.5 30.77 4.[48] The number of deals that happened in 2010 have been 3.44 43.0 20. Investments in the so-called Strategic Sectors are defined in a law adopted by the Federal Assembly of Russia.leadership. USD. there are sectors of the economy who are considered to be crucial for national security and foreign companies are restricted from owning them.9 25.76 Key data on the telecommunications market in Russia[41] Year 2004 2005 2006 2007 2008 2009 Telecommunications market value (€ bn) 12.39 40. ПK) – Russian "Production Cooperative" • . which is a new record.48 [edit] Types of legal entities in Russia • • • • • • • IP (Индивидуальный предприниматель) – Russian "Individual entrepreneur" OOO (Общество с ограниченной ответственностью. which was the second highest number ever. necessary banking reforms. ОАО) – Russian "Public joint-stock company" ANO (Автономная некоммерческая организация.24 30.0 23. [edit] Mergers and acquisitions From 1993 to 2010.53 5. including stricter accounting procedures and federal deposit insurance.662. АНО) – Russian "Autonomous nonprofit organization" GP or GUP (Государственное унитарное предприятие.6 20.9 16. The value of deals in 2010 was US$100 billion. ООО) – Russian "Limited liability company" ZAO (Закрытое акционерное общество. ГП or ГУП) – Russian "Unitary state enterprise" Фонд – Russian "Fund"[disambiguation needed] PK (Производственный кооператив. ЗАО) – Russian "Private joint-stock company" OAO (Открытое акционерное общество.4 Exchange rates[5] Year 2008 2009 2010 EUR/RUR 41.64 7.0 24.33 USD/RUR 29. Russian companies have been involved as either an acquirer or acquired company in 13.69 10.5 -13. compared to 2009 this was an increase of 143%.0 28.

• • • PP (Политические партии. ПП) – Russian "Political party" [edit] See also Timeline of largest projects in the Russian economy Monotown [hide]v · d · eEconomy of Russia History Natural resources Agriculture Industry Services Regional economies Economic regions Soviet Union · Privatization · 1998 financial crisis · National Priority Projects · 2008–2009 financial crisis · Medvedev modernisation programme · Timeline of largest projects Timber · Mining · Aluminium · Oil reserves · Energy · Nuclear power · Geothermal power · Renewable energy Fishery · Hunting · Forestry Aircraft · Automotive · Defence · Petroleum industry · Shipbuilding · Science and technology · Space industry Tourism · Telecommunications · Banking (Banks · Central Bank of Russia) · Gambling · Real estate Natural resources of Primorsky Krai · Federal subjects by GRP · Federal subjects by HDI · Federal subjects by unemployment rate Central · Ural · North Caucasus · Volga · West Siberian · East Siberian · Volga-Vyatka · Northwestern · Central Black Earth · Far Eastern · Northern Russian ruble · Companies · Infrastructure · Corruption · National champions · Billionaires · Tax Code · Stabilization Fund · Trade unions Wikimedia Commons has media related to: Economy_of_Russia Other • • • Commonwealth of Independent States History of post-Soviet Russia Politics of Russia IT & Telecoms Market in Russia • • • Putinism Russian Railways Unitary enterprise [edit] External links • .

org/external/pubs/ft/weo/2010/01/weodata/weorept. ^ "Sovereigns rating list". Retrieved 28 May 2011. 17. 16. Retrieved 20 August 2010. sets to become crediting country". 9. APEC Study Center. ^ http://english. 12. World Bank. 28 April 2011. Retrieved 29 September 2010. 3. ^ http://top. Pravda.cia.aspx? sy=2007&ey=2010&scsm=1&ssd=1&sort=country&ds=. "How Fitch. ^ https://www. The Guardian. ^ "Members".ru. Retrieved 27 December 2007. "Analysis: punished for his political ambitions". Simon.html 5. pg 7. Retrieved 27 December 2007. "Metal is the latest natural resource bonanza for Russia". Retrieved 31 May 2011.ru/2011/05/26/50861401.y=10%7Ctitle=Russia%7Cpublisher=International Monetary Fund|accessdate=1 October 2009}} 2. 15.• • • • • Construction Sector in Russia Retail & FMCG Sector in Russia RTS Stock Exchange RTS Index MICEX [edit] Stocks [edit] References 1. ^ a b c d e Russia’s economy under Vladimir Putin: achievements and failures RIA Novosti Retrieved on 1 May 2008 . 8. The Times (UK). ^ a b "Nuffield Poultry Study Group—Visit to Russia". ^ "International Reserves and Foreign Currency Liquidity . Retrieved 27 December 2007. International Herald Tribune. 10. World Bank. Sedghi. Ami (15 April 2011). Alex. ^ a b c d {{url=http://www. ^ Nicholson. ^ Page. Retrieved 26 May 2011.ruvr.&br=1&c=922&s=NGDPD %2CNGDPDPC%2CPPPGDP%2CPPPPC %2CLP&grp=0&a=&pr.x=61&pr. ^ "Doing Business in Russia 2010". ^ "Russia pays off USSR’s entire debt. ^ "GDP PPP". Retrieved 27 December 2007. 13.html 4. 14. Archived from the original on 30 November 2007. ^ a b c Rogers. Standard & Poor's. ^ "Russia: Clawing Its Way Back to Life (int'l edition)". 11. BusinessWeek. City University of Hong Kong. Moody's and S&P rate each country's credit rating".gov/library/publications/the-world-factbook/rankorder/2092rank.imf.ru/economics/30/03/2011/568417. International Monetary Fund. Jeremy (16 May 2005).shtml 7.RUSSIAN FEDERATION".rbc. The BEMB Research and Education Trust. ^ Russia attracts investors despite its image BBC News Retrieved on March 2008 18. Retrieved 27 December 2007. ^ a b CEE Market 6.

^ "Russian defense industry production up 2. ^ CIA World Factbook. 2 August 2007. Military Parade (4): 8–9.htm retrieved 2 August 2007 43. ^ It Market in Russia 45. 40. 37. ^ Rosstat Confirms Record GDP Growth Kommersant Retrieved on 5 May 2008 27. Retrieved 2 August 2007. ^ "Electronics in Russia". ^ Ionin. http://www. 32. MOSCOW. ^ ОСНОВНЫЕ СОЦИАЛЬНО-ЭКОНОМИЧЕСКИЕ ИНДИКАТОРЫ УРОВНЯ ЖИЗНИ НАСЕЛЕНИЯ 25. ^ Internet usage statistic 41. ^ IMF 2007 – 2013 estimates 29. 28. Denis (2009). Российские банки борются за частников 23. 2 June 2009. ^ Russia in the Global Storm. ^ Nanotechnology state investment until 2015 46.carnegieendowment. ^ "Russia plants flag on Arctic floor".com/text/d/3915045/ retrieved 2 August 2007 44.ihs. ^ "Electronics regrowth in Russia". ^ IMF Russia Retrieved on 19 April 2008 31. Konstantin (24 July 2008). "Russia’s Space Program in 2006: Some Progress but No Clear Direction". ^ CIA Factbook – Russia Retrieved on 19 April 2008 30. 16 December 2008.5% in 1Q09". 35. Moscow Defense Brief (Centre for Analysis of Strategies and Technologies) (2(#8)).19. ^ Manturov. "Prospects for the Domestic Aircraft Industry". ^ Putin’s Economy – Eight Years On Russia Profile. 39. ^ CIA – The World Factbook – Russia 26. Retrieved on 23 April 2008 22.com/news/2006/gsma-3g-russia. 36. ^ Russia Bids to Become a Tech Tiger 47. ^ РОЗНИЧНЫЙ ПОДХОД. Russia (Reuters) (CNN). Russia & CIS Observer. ^ Construction in Russia .ospint. ^ http://electronics. Andrey. ^ Medvedev is new Russian president Al Jazeera Retrieved on 7 May 2008 21. ^ Makienko. ^ a b "Russian arms exports exceed $8 bln in 2008". ^ Russians weigh an enigma with Putin’s protégé MSNBC Retrieved on 3 May 2008 20. 38.org/events/? fa=eventDetail&id=1326. Accessed 21 November 2010. Retrieved 6 January 2010. 21 April 2009. 33. ^ a b ICT in Russia 42. ^ http://www. RIA Novosti. RIA Novosti. 34. Retrieved 2 June 2009. ^ Ежегодно объем потребительского кредитования в России удваивается 24. "Successful Year for Aerospace Manufacturers". Retrieved 6 January 2010.

48. ^ Retail in Russia • This article incorporates public domain material from websites or documents of the Library of Congress Country Studies. – Soviet Union [show]v · d · e Russia topics (APEC) [show]v · d · eAsia-Pacific Economic Cooperation [show]v · d · eCommonwealth of Independent States (CIS) [show]v · d · eGroup of Eight (G8) [show]v · d · eEconomy of Europe [show]v · d · eEconomy of Asia .imaa-institute.org/statistics-mergers- acquisitions. ^ http://www.html#MergersAcquisitions_Russia 49.

Sign up to vote on this title
UsefulNot useful