Foreign policy is the main obstacle to the growth of the Russian economy, writes Bloomberg. The country is forced to divert resources to fight the sanctions and this shows the growth that could count.
“President Vladimir Putin is beginning to realize that it is impossible to increase economic growth and at the same time to build barricades to defend themselves with them against external sanctions,” — says the Agency.
The authors refer to released November 13, the data of Rosstat, according to which GDP growth in the third quarter, according to preliminary estimates, amounted to 1.3 percent. This was 0.6 percentage points less than the result for the second quarter. The newspaper reminds about the promise of Putin after the March re-election to a new term — to bring economic growth to the world average rate, which now stands at 3.7 percent.
Interviewed by Agency economists point to the strong macroeconomic indicators of Russia: a positive trade balance and the Federal budget surplus. According to them, this suggests that the country is prepared for new sanctions and increased isolation, and now almost does not depend on external borrowing. However, she is forced to fill its reserves, mainly due to budget rules involving the transfer of oil and gas windfall when the price of oil above $ 40 per barrel.
As a result resources that could be used for investment and, consequently, for economic growth, accumulate for a rainy day. The main burden of this policy falls on the citizens who are forced to Finance growing budget expenditures, including by raising VAT.
The experts also referred to the recent statement of the head of Centrobenessere Nabiullina, who called its main objective the mitigation of the negative effect of the sanctions. To do this, the controller raises the key rate, which increases the cost of loans and slows growth.
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