Russian reforms can’t seem to get off first base | GulfNews.com

Russian reforms can’t seem to get off first base | GulfNews.com:

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mage Credit: Dwynn Ronald V. Trazo©/Gulf News

In early November, the Russian government released its latest macroeconomic forecast. It could not have been an easy decision: Whereas President Vladimir Putin and his government campaigned in 2012 on a promise that the Russian economy would grow at 5-6 per cent per year during his six-year term, the growth rate is now expected to average just 2.8 per cent from 2013 to 2020.
Minister of Economic Development Alexei Ulyukaev explicitly acknowledged that achieving the targets set by Putin “will take longer”. In some cases, that means much longer. For example, in May 2012, Putin promised to increase Russia’s labour productivity by 50 per cent by 2018; the current forecast does not envision this outcome even by 2025.
For independent observers, the ministry’s grim forecast comes as no surprise. Judging by low stock prices and high capital outflows, investors were already betting against high growth rates. Now Putin and Prime Minister Dmitry Medvedev are pessimistic as well."

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