Posted on 01/24/2006 10:28:50 AM PST by x5452
Russia posts 6 percent GDP growth in 2005 JAN. 24 7:58 A.M. ET Russia's gross domestic product grew by 6 percent in 2005, the head of the Federal State Statistics Service said Tuesday. Vladimir Sokolin also said that inflation during that period was 10.9 percent, the lowest rate in the past seven years. Russia's economy in recent years has rebounded significantly from the economic collapse of 1998 and Sokolin said the latest figures show "the positive trend of social-economic processes continued."
(Excerpt) Read more at businessweek.com ...
(Also from the article)
He said average incomes rose 8.3 percent in real terms in 2005.
It's funny how they controlled inflation in the last quarter. They told the oil companies that they can't raise prices for gasoline anymore.
Personally I'm happy to see income levels rising.
My wife's dad just bought a Hyundai on credit (pays around 1000 a month for it). More cash comes in handy.
Hmmm....how would they be doing if oil and gas prices had not risen dramatically?
They have great economic growth, have controlled inflation and spending, and paid down debts remarkably well. The flat tax is good for business.
The big problem still is the crisis of low birthrate, which needs to be treated like a national emergency.
Either that or they are learning about a free market and capitalism. Governments should not be in the business to tell business how to run their business. Unless you're a communist.
My wife was reading an article which says the Russian government is going to start giving money to parents of newborns up until their like 11, and pay for medical bills as well. Even in 2006 Putin has already put the birth rate on the agenda.
They have some stability, but they are running at 10% of capacity simply because their capital is unavailable as collateral.
That and their infrastructure in many places hasn't been updates since the Tsar left power.
(Imagine them running at full capacity)
I wonder how much of that GDP growth is due to Russia selling terrorist countries arms, the heroin trade and prostitution.
Infrastructure is expensive, and even more so when the economy is running at such a low level. They could double their economy instantly by recording deeds. For example, everybody in the village knows which house belongs to Farmer Brown, to Farmer Jones, and which field to which. But, this property, while recognized by the neighbor farmers, is not available to raise capital since the banks need paper. If they would simply have a massive program to write deeds in correct legal language and record them, there would be fifty million new properties on file that the banks would be happy to accept as collateral and the funds so raised would be available for all kinds of commercial investment.
(Generally speaking mafia activites aren't reported to GDP)
Infrustructue wise it's pretty scarey that there's not one road that runs the full length of the country. To get to Siber sooner or later you need to hop a train (and only 2 train routes go to Siber).
Recording deeds would be helpful perhaps but I don't know that banks would still lend the capital. Banks are pretty conservative lending at the moment.
(Generally speaking mafia activites aren't reported to GDP)
No kidding! I forgot to put the /sarc onto my post. ;)
You bring up something of a point however.
A fair amount of businesses in Russia report less than 100% of their earnings. (Tax evasion is extremely common).
It's possible that the official numbers don't do the economy justice.
Alaska is similar to Russia in climate and vast roadless tracts, and natural resources, on a smaller scale. Boris Yeltsin visited Gov Murkowski last summer to see why Alaska is not only keeping its people, but the population is growing, while Russia is seeing a drain even while Russia has ten times the resources. Strangely, the private property situation in Alaska is also similar to Russia's. Gov't owns almost everything in Alaska, too, as demonstrated by the failure to allow development of ANWR. But, the corporations are also persons in the US and have full property rights; most corporations are private rather than gov't businesses, and are barely regulated at all. In fact, the US Gov't has as its main task the encouragement of commerce, which means that the roads, laws and other communication links are built for the corporations. 80% of infrastructure is to enable commerce in the form of the corporations, and if a private citizen can also use the highways and the Internet, so much the better. It is private property, in the form of private leases and easements on gov't land, that allows Alaska's resources to be developed, and the capital the corporations have available comes directly through private property, that is, the corporations are owned by the private sector, real property and personal property that can be used as collateral--a multiplier effect. Sorry it is difficult to explain the whole idea in a short post.
I'd normally wait until it's paved to say it's a finished road (tractor trailers don't exactly hall lumber well on dirt, not economcically at least).
The fact that there's as many folks traveling it as are in that pic through prove that a little patch of dirt road won't stand in the way of travel. :)
"It's possible that the official numbers don't do the economy justice."
I'd love to see Russia improve on its economy. It would be better for the world if they didn't have to resort to arms deals with terrorist nations to keep money flowing in.
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