#6337
[Second Issue of the Day]
#6
Kommersant
July 3, 2002
[translation from RIA Novosti for personal use only]
"THE GROWTH RATES ARE WHAT THEY ARE, AND WE WILL
NOT FORECAST ANY OTHER"
By Irina GRANIK
On July 2 Minister of Economic Development and Trade Gherman Gref gave an account of the work done over the past six months and completed the debate on the problems of economic growth. The government is not going to change its forecast. That's all.
"The growth rates are what they are, and we will not forecast any other," Gherman Gref stated on July 2. So, the Ministry of Economic Development and Trade, despite the attacks of the president's adviser Andrei Illarionov and the president's remarks, is continuing to insist that the done calculations of the budget forecasts will not be altered. The Minister gave it to understand, however, that his Ministry's forecasts, too, can be moderately optimistic. "By the end of the year we will reach the forecast growth of the GDP - 3.6 per cent. And there may be certain excess," he stated. Over the past five months the Russian GDP has already increased by 3.7 per cent due to the growth of end-product demand and of export. Gherman Gref replied to all the accusations concerning the understatement of growth: "In their (alternative - Commersant) estimates the food industry, for example, grows by 35-40 per cent. This is possible but only at separate enterprises." And on the whole the Minister does not overestimate the growth rates of industrial output. According to him, "it is difficult to call them satisfactory" - a mere 2.7 per cent over the first five months of this year. But, in his opinion, it is good at least that Russia has overcome the stagnation of industrial production which was observed at the beginning of this year. "Now it is important to support and continue the structural reforms," the Minister concluded.
The government intends to continue carrying out the structural reforms in all directions - from the reform of electricity production to further liberalisation of foreign- exchange regulation and the reform of state service. "Every year we lose 2 per cent of the GDP because of the bad administration," the Minister said honestly. The liberalisation of foreign- exchange regulation will be continued in autumn. As Gherman Gref stated, the government will submit a new law on foreign-exchange regulation to the Duma. The struggle around it between the Finance Ministry and the Central Bank, on the one hand, and the Ministry of Economic Development and Trade, on the other, has been going on already for a year. Yesterday Gherman Gref gave it to understand that his Ministry has proposed reducing the 50-per-cent normative of compulsory sale of foreign-currency receipts but did not say by how much.
Reform of the power industry is a theme which is the most painful to the government. State Duma speaker Gennady Seleznev even stated on July 1 that the reforms and the activity of RAO UES to carry them out will have to be halted because the concept of the reforms in the laws can change during their finalisation.
On July 2 Gherman Gref stated that the government is not going to stop the reforms and to change their course, and RAO UES "has been doing everything correctly." In general, the Minister gave it to understand that he would do his best to avoid political conflicts around the reform of the power industry. As he said, he does not see any politics here at all, and we witness only the governors' concern over uninterrupted electricity supply in the regions.
Management of the state property is another delicate theme. The Minister intends to make radical moves here, too. In his opinion, the state must not control the state blocks of shares. Since it is business, the managing companies or a special agency must deal with them. The state can manage only the 100-per-cent state-owned enterprises. In addition the Minister said that the 6-per-cent state block of the LUKOIL shares would be sold this autumn. In expert opinion, its price will exceed 660 million US dollars.
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