#6063
[Second Issue of the Day]
#3
Nezavisimaya Gazeta
February 7, 2002
GREF IS NO LONGER AN ECONOMIST
Managing the economy is partly a matter of public relations
Author: Natalia Melikova
[from WPS Monitoring Agency, www.wps.ru/e_index.html]
ECONOMIC DEVELOPMENT MINISTER HERMAN GREF EXPRESSED HIS OPTIMISTIC VIEWS ON ECONOMIC GROWTH THIS YEAR. HE IS SURE THAT THE SLOWDOWN IN ECONOMIC IMPROVEMENT IN THE FORTH QUARTER OF 2001 WAS NOTHING BUT A SEASONAL FLUCTUATION. HOWEVER, ECONOMIST RUSLAN GRINBERG BELIEVES THAT THE SLOWDOWN IS LIKELY TO CONTINUE.
Today the Economic Development and Trade Ministry will familiarize the Cabinet with measures on securing macro-economic stability in 2002. And yesterday at the meeting with members of the European business club the leader of the ministry once more confirmed the fact of serious slow-down of economic growth in the last quarter of 2001. According to Greff, preliminary data proves that economic growth slackened and may have come down to zero point.
And really, the growth of Russian economy in the forth quarter of 2001 slowed down considerably in comparison to the third quarter. "If we took as an example the volume of production of the five basic branches of the economy, which can give us an approximate volume of the GDP, says deputy chairman of the State Duma committee on budget and taxation Ashot Yegiazaryan, then this November this index decreased by 6.3% in comparison to October. At the end of the year monthly paces of home demand growth also slowed down, as well as investments. In December we observed a sharp decrease in demand for industrial products, which affected almost all the branches of industry." The head of the Economic Development Ministry is sure that this was a seasonal fluctuation, which happened also last year. Mr. Gref hopes that this year the economic growth will resume its pace. But not all share the optimistic point of view of the minister. In particular, deputy head of the Institute for International Economical and Political Research of the Russian Academy of Science Ruslan Grinberg is certain that the tendency of halt in basic economic figures is not a short-term one. According to the economist, the reason for this is sinking home demand, which takes place due to, first of all, the fact that increase in prices surpasses the falling rate of the ruble to the dollar. And this, in its turn, naturally leads to decrease in purchasing capacity of the population. Besides, favorable for the Russian industry consequences of the ruble devaluation are fading out and the economy is more and more turning to imported products. And these factors are not connected with seasonal phenomena, and are of a long-term character.
Meanwhile, the Economic Development Ministry believes that no emergency measures are needed for maintaining stable growth, and the government should concentrate on driving economic reforms. At yesterday's meeting Herman Gref gave voice to a list of more than ten and a half items, among which - continuation of the tax reform, re- structuring natural monopolies, changes in the tax legislation. The priorities for this year are social reforms: transformation in the systems of medical and social insurance, continuation of the pension reform and reform of the housing and communal services. At that, Gref laid special emphasis on the fact that 100% rent payment is an impossible and unnecessary task. According to the minister, there will be a new effective system of address subsidiaries, and only those who are well off will have to pay the whole amount of rent.
Meanwhile, taking into consideration the coming two years of "big elections", the factor of failure in reforming the social sphere may become a sword of Damocles for those in power. However, the Economic Development Ministry is sure that they can handle any problem, and the most important issue is that everything should be presented to the public correctly. "The economy is 50% advertising," said Economic Development Minister Herman Gref yesterday. (Translated by Daria Brunova)
Back to the Top Next Article
- Back to the Top -