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IMF Spotted Overheat Signs in Russia
Russia’s macroeconomics has the signs of overheat, the International Monetary Fund warned in its special report released after meeting with the country’s government.
According to the IMF, the growth in domestic consumption is much above the GDP movement, and employers are forced to hike salaries due to the labor shortage on the market, i.e. the growth in salaries is outpacing the increase in production efficiency.
Inflation is one of defects of Russia’s economy. It was above 15 percent in annual terms in June of 2008.
The IMF conclusion on economy’s overheat is no news actually. The RF Finance Minister Alexei Kudrin was the first to draw attention to it. The minister was followed by the World Bank and afterwards by German Gref, who was the economic development minister then and is Sberbank CEO today.
Regardless, there are some positive trends as well. Russia’s banking system was fairy stable in time of the global financial collapse, investments are growing, the GDP has surged.
Under the IMF forecast, Russia’s economy will remain stable in the near future, although the inflation pressure will be notable. The GDP growth is forecasted at roughly 7.8 percent in 2008 and 7.3 percent in 2009.
www.kommersant.com
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