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The Monotonous Advance
Nowadays the bureaucrats of different ranks tend to call for economy’s diversification here. Diversification is “the top priority of Russia’s government when pursuing economic policy,” PM Mikhail Fradkov said not long ago.
Meanwhile, the latest report of Development Center showed that the number of industries with accelerated development has gone down materially in the recent months. In August, the group of 21 products (mostly raw, electric energy, food, product of pulp and paper industry) ensured 85 percent of economy growth in Russia, though the indicator was 73 percent in June and just 48 percent in April.
“The front of economic growth is narrowing rapidly,” signaled Development Center’s expert Valery Mironov.
Today’s leaders (40 percent of growth) are crude oil, electric energy, rolled metal. The leading standing of crude oil is a matter of tradition already and its share in Russia’s economy has widened recently. Crude oil provided for 12.7 percent of industrial growth in April, 15.8 percent in June and 19.8 percent in August.
The real news is the increase in industrial growth dependency on electric energy, which accounted just for 4.8 percent in April but jumped to 16.2 percent in August.
“The data show that Russia’s economy is becoming less diversified,” Mironov said. His assumption is confirmed by the exports. If fuel and energy product accounted for 62.9 percent of the overall exports in January through July of 2005, it soared to 67.8 percent next year.
The poor competitive ability of processing in Russia narrows the field of industrial growth to goods, which production is the easiest and which are no match for imported goods.
The situation is further aggravated by continuous increase in individual revenues. Enterprises tend to hike wages to keep labor force, but this effort drives up production costs as well. The prices of manufacturers will jump at least by 15 percent this year, further worsening competitive ability of our industry, analysts of Development Center forecasted.
www.kommersant.com
All the Article in Russian as of Oct. 11, 2006
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