It was a terrible night for a moment. As if from nowhere broke the news: Minister of economic development of the Russian Federation due to corruption charges is in jail pre-trial detention. It was in mid-November. The camp of the patriots rejoiced. They hoped that come the end of the economic liberals in the government and thus an end to suicide, from their point of view, the policy of savings. Many people in Russia believe that the policies imposed from the outside. But then a new Minister of economic development was appointed Maxim Oreshkin, 34-year-old economist who is considered a supporter of the market economy. It is perhaps, no of a new turn in the economy will not work.
For several months Russia at war with each other two economically-political camps. On one side are the Industrialists, lobbyists and economists requiring the program to stimulate the economy. They want the state approved the money and credit to stimulate the economy. On the other side are market liberals who believe in excessive government intervention and high cost threat. While they have the advantage.
While Vladimir Putin does not allow them to rebuild the system as they would like. Russian economic policy in any case is not liberal. But the savings for President is important. Putin prefers a strict budget policy, because debts, in his opinion, imply the loss of sovereignty, says a prominent economist and publicist Boris Grozovsky. Ultimately, the lenders with loans, and that the President wants to avoid in any case.
At the moment, Putin has every reason to be satisfied. Although Russia and got stuck on the way down, but the collapse, which was feared did not happen, despite falling oil prices, sanctions and currency devaluation.
And next year the economy would be able after two years of recession even begin to grow. The world Bank in its November report comes from growth of 1.5% in 2017. The ruble against the Euro rose by almost 20% compared to last year. The mood in the domestic industry has improved a lot, as the index of management of purchasing in the manufacturing industry, which the market researcher Markit monthly keeps track, in November reached from 53.6 points to the highest level since March 2011. Figures over 50 indicate growth.
Chance remained unused
However, the positive numbers are only hiding deeper issues. During the crisis Russia has been trying to become more independent from commodity exports and diversify their economic structure. At the beginning of the crisis in Ukraine, when the West and Moscow declared against each other sanctions, the Russian government embarked on a policy of import substitution. She spoiled Russian producers with money and orders and demanded from foreign corporations, so that they could bring their production to Russia. The head of the Moscow branch of the Russian-German chamber of Commerce Shepp Matthias (Matthias Schepp) calls it a policy of carrot and stick. The one who invests and produces in Russia, receives often more easy access to the market than importers.
However, this policy did not work completely. Only agriculture and some industry in engineering and manufacturing of vehicles could show good results.
But more important structural reforms, which constantly demanded the Kremlin advisers and Ministers have not been conducted. The Russian economy remains dependent on oil. And she currently is recovering only because the raw materials again became much more than a few months ago. The deal with OPEC Russia, which should in the coming year to limit oil production, called on the Russian financial markets great joy. However, the investment climate in the country as bad as before.
And the next problem is already waiting. In spite of all efforts to economize, the government plans annual budget deficit of 3%. It can Finance it from its own reserves, without accumulating new debt. In the Reserve Fund and national welfare Fund at present to 30 billion dollars, but they will only last one or two years.
Perhaps the Kremlin will be able to Finance its deficit, if you start to distribute bonds to their own citizens. Then he would have remained independent from abroad. At the same time, it seems that the government firmly hope that the best the price of oil can return to the old stability. Recently, the Central Bank predicted that the Reserve Fund 2019 may again be refilled if the price of oil exceeds $ 55 per barrel.
In this case Putin, indeed, could continue to operate as before without starting to implement the necessary reforms. But even if it will — that the economy will once again be able to approach old growth 2000-ies, in Russia nobody believes.