On the Verge Of Destabilization
Russia’s economy has probably reached the verge of destabilization. Yesterday, Vice Premier and Finance Minister Alexei Kudrin acknowledged that the 2007 inflation would be roughly 10 percent. Chief strategist of Economic Development Ministry, Andrei Belousov, drew attention to the new economic risks and aggravation of the old ones, including inflation, decline in crude prices, overheat of credit and consumer markets, payment balance worsening.
Vice Premier Alexei Kudrin and Deputy Economic Minister Andrei Belousov were reporting the growth in economic risks when President Vladimir Putin was telling the nation about economic achievements at the yesterday’s televised question-and answer session.
For the first time, Kudrin officially acknowledged that the inflation would be roughly 10 percent in 2007. Belousov was even less optimistic. He said the inflation will probably surpass even that level, as the prices soared 0.9 percent over the first two weeks of October and the accumulated inflation could be 9.1 percent by the end of this month.
But it was only the beginning. Belousov didn’t confine to inflation growth but described a bunch of mid-term risks that may lead to economic collapse. They are inflation, drop in the world prices for crude, overheat of credit and consumer markets, worsening of payment balance.
The new problems have evidently emerged in the country’s economy and it is not by chance that Andrei Klepach from Economic Development Ministry announced Wednesday that they have elaborated the revised macroeconomic outlook, but the figures are top secret.
www.kommersant.com
All the Article in Russian as of Oct. 19, 2007
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