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World Bank Condemns Russia to Stagnation
In another report on Russia, the World Bank severely criticized the efforts of our government in part of creating new economy and innovation model of growth. All attempts will be abortive unless the cabinet sets up conditions for general competition in economy, the World Bank concluded.
Russia’s GDP will grow by 7 percent in 2006, the World Bank said in the report presented in Moscow yesterday. Even though the forecast of the bank’s authority is higher than the official outlook of Russia (6.8 percent), the report doesn’t praise the economy of our country.
Processing industries that have to compete with imported product are slowing down. Nearly all industries but for the raw ones and metallurgy cannot compete worldwide, the World Bank analysts signaled in their survey.
In Russia, the emphasis has shifted from the classical and liberal economic target, the one aimed at creating equal conditions for private initiative and entrepreneurship to industrial or regional policy aimed at the prior advance of certain branches, regions or enterprises.
Russia’s ministers don’t hide the change actually, attributing it to transferring to some active industrial policy. The high-rank advocates of the latter are Prime Minister Mikhail Fradkov and Economic Development Minister German Gref, who refer to successful advance of the South Asian states – China, Taiwan, Singapore.
The tricky point is that in South Asia, the breakthrough was insured not by the active industrial policy but rather by structural reforms and creation of normal competitive environment, the World Bank analysts said. Moreover, Russia will hardly be able to repeat the experience of Asian tigers – the world is different now and the labor isn’t very cheap here.
www.kommersant.com
All the Article in Russian as of Dec. 06, 2006
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