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GERMAN GREF: RUSSIA HAS POSSIBILITY TO DOUBLE GDP BUT HAS TO MATERIALIZE IT

MOSCOW, June 21 (RIA Novosti) - Russian minister of economic development and trade German Gref believes that Russia has the possibility to double the gross domestic product but still has to materialize it.

It is oil refining rather than oil production that can help Russia to double the gross domestic product, the minister said today while speaking at an international conference organized by Renaissance Capital.

"The country has some competitive advantages and huge raw material reserves, which must be used to start economic recovery," German Gref said.

At the same time, he noted that the year 2004 had showed that the country was on the verge of using up these advantages. "This can be judged both from the volume of oil and gas output and the infrastructure possibilities," the minister said.

German Gref proposed to transfer "the maximum amount of resources held by the state" to private business.

In his opinion, oil production growth cannot help the country to double the gross domestic product within ten years. "The development of this sector will help Russia to keep growth rates at the level of 5-7% per annum but no more," the minister said.

"It is the processing of resources that will help Russia to double the gross domestic product," the minister noted. That is why, the state must create the most advantageous tax and customs regimes for private business to invest in oil refining, he said.

In the opinion of German Gref, the development of timber production and processing, and also the production of military-industrial, aerospace equipment and electric power machines, agricultural machinery and vehicles can also contribute to GDP doubling.