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Economy Reaching Risky Zone
The Central Bank of Russia (CBR) released Friday the first estimation of H1 payment balance. The exports of goods reached $240 billion and the exports of services stood at $22.8 billion, while the imports of goods equaled $135.2 billion and the services posted $33.3 billion. The trading balance and the current operation account had the surplus - $104.8 billion (75 percent up on year) and $69.4 billion (up 89.6 percent) respectively. The net private capital inflow was $12.3 billion, although the outflow of $23.4 billion was registered in the first quarter.
The trading balance and the current operation account had the record surplus by the H1 results – the pace of the export growth (54.4 percent) was again ahead of the acceleration manifested by imports (41.6 percent). When it comes to the surge in the exports, its better part was secured not by the increase in its volume but rather by the growth in prices for raw, mostly for crude oil and other hydrocarbon.
Their exports reached $161 billion in the first half of the year vs. $94.6 billion a year ago and $64.9 billion in the first half of 2005. The hydrocarbon exports accounted for 59.1 percent of all exports of the country in 2005, but its portion has widened to 67.1 percent as of today.
Of interest is that the indicators wouldn’t be so advantageous if the oil and gas revenues stood still. With the oil and gas revenues equaling the amount of 2005, the current operation account had the red ink of $26.7 billion, i.e. nearly 1.5 percent of GDP. With today’s exchange rate of the ruble and the import growth (50 percent on year in the recent months), the decline would be abrupt.
But the policy of the CBR would be quite different if the payment balance finally collapsed – the matter at stake would be the gradual depreciation instead of today’s appreciation and the highlight would be attracting the foreign money instead of opposing its excessive inflow. With today’s prices for crude oil, the change of economic policy could be expected in the nearest two or three years, or it may happen sooner if the prices for crude oil finally decline.
www.kommersant.com
All the Article in Russian as of July 07, 2008
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