Vice Premier Igor Sechin, right, talks with Rosneft President Sergei Bogdanchikov, June 5, 2008.
Photo: Dmitry Dukhanin
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Industrial Records Are Mere History
July of 2008 wasn’t the best month for Russia’s economy. The growth was just 3.2 percent, i.e. 0.9 percent above June and below the general hopes of analysts. As no one expects the acceleration of summer 2007 (10 percent and more) to repeat earlier than in the fall, too cautious outlook of the RF Economic Development Industry (annual industrial growth of 5 percent to 6 percent) may turn out too optimistic in the end.
The slowdown of industrial growth continues, judging by statistics that Rosstat released yesterday. The pace was just 3.2 percent in July, which makes it 5.4 percent for January through July. The figures are higher than the June disappointment of 0.9 percent but are amid the lowest indicators of the recent years.
The slowdown is particularly evident if compared with the acceleration of a year ago, when the industry’s speed was 9.6 percent in June of 2007 and 10.3 percent in July of 2007.
Not only the general figures but even the most objective indicators point to the negative trend. The mining operations, for instance, fell 1.8 percent on year in July, and the extractive industry stepped up by no more than 0.2 percent in the first seven months of this year (2.7 percent a year ago). The decline could be blamed on the oil and gas production, which lowered 1.9 percent and 0.9 percent respectively in July despite the very close attention of the government. Vice Premier Igor Sechin pledged to prevent the drop in crude oil production this year and has held a raft of meetings with oilmen already.
Given that the macroeconomic and investment environment will hardly materially improve in the nearest months, especially in view of the August military standoff of Russia and Georgia, the hopes that the production growth will recommence before winter of 2008 don’t appear justified. More likely than not, the traditionally conservative outlook of Economic Development Ministry (5.7 percent for 2008) will match the reality or prove even too optimistic for it. In April and May, however, most of analysts projected that the industry would easily surpass that outlook by this year’s result.
www.kommersant.com
All the Article in Russian as of Aug. 19, 2008
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