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Russian economic report (Russian)

For the past three years, the economy has grown rapidly, although growth rates have declined year after year. This trend continued over the first months of this year, when the rate of growth of industrial output slowed to three percent in the first four months, and investment growth slowed to 1.2 percent in the first quarter. The possibility of increasing the utilization rates of capital and labor, after the long period of decline and the crash 1998, guaranteed high growth and considerable productivity advancements. However, the aggregate data suggest that the ceiling on improvements of capacity utilization and hoarded labor is being approached. Consequently, future growth is likely to rely more on investment, and the productivity advancement embodied in it than it has in recent years. Meanwhile, a large public discussion has ensued, starting from the question of the rate of growth required for Russia to catch up with OECD economies. It has quickly moved into the territory of discussing realistic expectations of growth under the current circumstances, and of the policies that would be most conducive to fostering long term growth. The first section of this report briefly reviews recent economic developments, including the continuing slow-down in economic growth. The second section discusses in more detail long-term patterns of economic growth in Russia, and the conditions under which they may emerge. It cautions against unrealistic expectations, given Russia's large investment needs and argues that reversing and managing Russia's current capital exports will be a key variable that determines whether a period of long-term high growth can be unleashed in the future. The third section introduces a study, recently carried out by the Bank, on the Economic Consequences of HIV/AIDS and the implications for Russia's long term growth prospects.


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    Russian Federation,

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    Europe and Central Asia,

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    Russian economic report

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    agriculture, availability, Average Annual Growth, average growth, bottom line, budget constraints, capacity utilization, capital accumulation, capital formation, capital inflows, capital investment, Capital investments, capital stock, Central Bank, commodities, commodity prices, competitiveness, developing world, disposable income, domestic energy, domestic savings, Economic Consequences, economic development, economic growth, economic reform, Economics, Electricity, Electricity prices, energy prices, expenditures, exports, external conditions, factors of production, financial markets, financial sector, fixed capital, foreign investment, fuel, Gas prices, GDP, GDP per capita, growth model, growth path, growth prospects, growth rate, growth rates, health care, high growth, high growth rate, high sensitivity, Income, increase in capital, increased investment, industrialized countries, inflation, interest payments, investment climate, investment environment, investment flows, investment growth, investment needs, investment rates, labor force, Labor Market, labor supply, Long-term growth, M2, macroeconomic management, macroeconomic model, macroeconomic policies, medium term, monopoly, natural gas, Natural monopolies, negative effect, negative impact, neoclassical growth model, oil, oil companies, oil price, oil prices, output growth, policy changes, Poverty, poverty rate, power, price fluctuations, price increases, price of oil, production costs, productivity, productivity growth, productivity increases, profitability, public service, rapid growth, real exchange rate, real GDP, real income, real wage, real wages, reform policies, reform program, relative prices, resource allocation, skilled workers, technical change, technical progress, TFP, total factor productivity, total factor productivity growth, Trade Balance, transition economies, unemployment, unemployment rate, wages,



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Russian economic report (Russian). Russia Economic Report,no. 3 Washington, D.C. : World Bank Group.