Carry out a research of RUSSIA\'s economy. Minimum areas to discuss includes: th
ID: 1205569 • Letter: C
Question
Carry out a research of RUSSIA's economy. Minimum areas to discuss includes: the GDP, GDP by Sector, GDP per capita, employment by sector, major industries, unemployment, labor force by age, education, literacy rates, life expectancy, natural resources, technology, inflation, average income, sources of income, % below the poverty line, governmental structure and money system, trade, foreign direct investment, national debt, exchange rates, infrastructure, technology, war, genocide, disease, geography and climate, trends and their outlook for the future.
Explanation / Answer
2011 2012 2013 2014 2015
Population (million) 143 143 144 144 144
GDP per capita (USD) 13,192 14,289 15,340 15,390 8,181
GDP (USD bn) 1,886 2,048 2,204 2,212 1,176
Economic Growth (GDP, annual variation in %) 4.3 3.5 1.3 0.7 -3.7
Consumption (annual variation in %) 6.8 7.4 4.4 1.5 -9.6
Investment (annual variation in %) 10.2 6.0 0.9 -2.6 -7.6
Industrial Production (annual variation in %) 5.1 3.4 0.4 1.6 -3.4
Retail Sales (annual variation in %) 6.9 6.5 3.9 2.7 -9.7
Unemployment Rate 6.6 5.5 5.5 5.2 5.6
Fiscal Balance (% of GDP) 0.8 0.0 -0.7 -0.6 -2.8
Public Debt (% of GDP) 9.5 10.5 11.4 13.2 13.6
Money (annual variation in %) 22.3 11.9 14.6 2.3 11.5
Inflation Rate (CPI, annual variation in %, eop) 6.1 6.5 6.5 11.4 12.9
Inflation Rate (CPI, annual variation in %) 8.4 5.1 6.8 7.8 15.5
Inflation (PPI, annual variation in %) 12.0 5.1 3.7 5.9 10.7
Policy Interest Rate (%) 5.25 5.50 5.50 17.00 11.00
Stock Market (annual variation in %) -21.9 10.5 -5.5 -45.2 -4.3
Exchange Rate (vs USD) 32.02 30.48 32.73 56.26 72.88
Exchange Rate (vs USD, aop) 29.67 30.36 30.03 35.24 68.73
Current Account (% of GDP) 5.2 3.5 1.5 2.7 5.9
Current Account Balance (USD bn) 98.8 71.3 34.1 59.5 69.6
Trade Balance (USD billion) 197 192 181 190 149
Exports (USD billion) 515 527 522 498 341
Imports (USD billion) 319 336 341 308 193
Exports (annual variation in %) 31.3 2.3 -1.1 -4.6 -31.5
Imports (annual variation in %) 29.7 5.4 1.6 -9.7 -37.4
International Reserves (USD) 499 538 510 385 368
External Debt (% of GDP) 28.9 31.1 33.1 27.1 43.9
Population has been same or consistent past 5 years, while GDP, Fiscal balance, Consumption, Investment, Economic growth all has followed a decline to negative trend. Trade balance has also declined & economy is surviving on Exports. Economy has also experienced two-digit Inflation in the past 5 years. As Russia's economy stalls, more Russians are being pushed into poverty. Three million more Russians fell below the poverty line last year — meaning they made less than 9,452 rubles, or $180, a month — pushing the total to more than 19 million. Russia's economy, heavily reliant on oil, has been battered by low oil prices and international economic sanctions, including those from Canada, imposed in the wake of Russia's annexation of Crimea and its role in the conflict in eastern Ukraine.
Looking at the future, the economy is projected to contract again in 2016, although the recession is expected to ease. Our panel of experts expects GDP to contract 1.3% in 2016 as a weak ruble is likely to shore up exports and falling inflation should support real wages and private consumption. That said, the recovery remains fragile, with oil prices expected to rise only gradually over time and international sanctions set to remain in place for quite some time. Consequently, this month’s forecast was cut by 0.2 percentage points over last month’s projection. For 2017, analysts see the economy expanding 1.2%.
Both poverty and unemployment have risen in the country in recent months. Despite a worsening economy, Russia has still increased its 2016 defense budget by 0.8 percent and is continuing its campaign in Syria. The increase in military budget by 0.8 percent when inflation in the country is 13 percent actually means shrinking of the military budget. If the political risk of doing business in Russia remains high, that means foreign businesses will refrain from going to Russia. And that will keep Russian growth rates low, even if the country recovers from the recession. That’s very low for the emerging economies and that means the share of Russia in the global economy will shrink, and the technological gap between Russia and developed nations will increase.
Over the last 10 years, Russia has attracted more foreign direct investment (FDI) than Brazil and India, but significantly less than China. However, at 3.3%, the FDI share of GDP in Russia is just behind BRIC leader China (3.7%), and far outpaces Brazil (2.4%) and India (1.4%).
The lack of infrastructure investment over the last 10 to 20 years has dropped Russia to 93rd globally in quality of overall infrastructure in The Global Competitiveness Report 2013–2014 prepared by the World Economic Forum. China and India are placed at 74th and 85th, respectively.
Only the quality of railway infrastructure in Russia comes in at a relatively high level (31st). All other areas (quality of roads and highways, quality of port infrastructure, quality of air transport infrastructure and quality of electricity supply) need improvement.
Sectors
The greatest amount of money is planned for railway transport infrastructure development. This mainly includes the projects set out in the program of high-speed railway development through 2030.
The second-largest direction of planned infrastructure investments is road and bridge construction. This mainly includes projects under the jurisdiction of the state corporation Avtodor and those in the Russian transport strategy through 2030.
The greatest quantity of projects is expected to be realized in the power and utilities segment (including electric power supply, water supply and gas supply infrastructure projects).
Projects location
Most investment projects are located in Western Russia, which has higher population density and features more economic activity than the Eastern part of the country.
Positive impact of infrastructure development
Meanwhile, the positive impact of infrastructure development has been proven by the experiences of other countries. The most cited effects are:
Lower costs of production
Increased net output for the national economy
Widening labor catchment areas
Increased competition
Increased inward investment
Reorganization of land use
Previously inaccessible sites opened for development
The overall effect of infrastructure investments is increased productivity, a key goal for many companies operating in Russia.