What Can Keep Russia from Growing?

PanAsianBiz ^ | June 9, 2006 | Dr. Bill Belew

[G. Stolyarov II]

What can keep Russia from growing?

1. Soviet-era bureaucracy 2. Outdated industry 3. Poor investment climate 4. Retailing is booming, but other businesses lag. 5. Millions of Russians are at risk of being left behind.

What will keep Russia growing?

1. Russia will depend on its oil revenues for the forseeable future.

Question: Will oil revenues generate enough income that can be equitably distributed to the point that it will overcome the barriers to growth?

What do you think?

[G. Stolyarov II]

The problem with depending on oil revenues for Russia's continued growth is that the Russian government is acquiring an ever greater share of the Russian oil industry; government mismanagement will ruin this industry just like it ruined virtually all Russian industries during the Soviet era. The only reason why retailing is doing so well in Russia today is precisely that retailing has been largely free of direct government management. See Dr. Belew’s blog at PanAsianBiz

[GSlob]

If one to believe the CIA factbook, the proven oil reserves there could cover 20 years of extraction at current levels. [gas for about 80]. Of necessity these are only ballpark estimates, but "foreseeable future" ought to stretch further than 20 years, if only because the decline in oil production would be gradual, and not sudden, and will start earlier.

[GSlob]

If one to believe = if one is to believe.

[Gefreiter]

What can keep Russia from growing?

Alcoholism...HIV...tuberculosis...low birthrate...brain drain...corruption...