About problems of the Russian economy.
Murychev Alexander. Executive Vice-President of the Russian Union of Industrialists and Entrepreneurs.
The problems of the Russian economy and the role of the Central Bank in the structural transformations in our country, creating a mega-regulator and the regulations of the banking regulation Basel II and Basel III, we are talking with Alexander Murychev, , Executive Vice-President of the Russian Union of Industrialists and Entrepreneurs, Chairman of the Council of the Association of Regional Banks of Russia.
- Speaking at the International Banking Congress in St. Petersburg, You said that “whatever we treated the problems of the Russian economy and banking system that is, but the last few months does not give grounds for optimism”. Why?
Alexander Murychev: Investments are falling, the rate of growth of industrial production is still not negative, but close to it (0.5% compared to April of last year). And this is a very serious indicator that causes anxiety. Even more disturbing picture emerges on the oil market. The economy remains dependent on raw material prices. Budget by more than 50% of the oil, and because the Outlook for the oil market negative, then the trend for the near future looms negative. The government was forced to revise the income downward at a constant level to ensure all the social programs that have already been taken and from which, no doubt, to refuse the Government should not be. Therefore, according to the Ministry of Finance, this means that the budget can be balanced already not at 100-105 dollars per barrel, as at 110 and 115 dollars per barrel. Another option is to print the Reserve Fund to cover the growing budget deficit.
- Do we pull these figures?
Alexander Murychev: Obviously not. Because it happens in the fall the demand for our raw materials from Europe. Already obvious opportunities to reduce the needs of China, because in China recently, unfortunately, has seen a slowdown in economic growth. And China was the main driver for the development of the world’s GDP, and, unfortunately, in recent months there is a clear slowdown in its economy. Therefore, as the deterioration of the Russian economy development, we are in the last months are seen inflame passion about easing monetary policy, including through the reduction of the refinancing rate of the Bank of Russia.
Indeed, this is important: the rates should be reduced, to reduce the costs, risks, reduce the margin through cost optimization. All this is obvious. The government places absolutely correct tasks. And the arguments of those experts, who are now at the reduced rate, is obvious. Business activity is dependent on the amount of interest on loans. And the latter, in turn, depends largely on the refinancing rates. The main argument “for” the rate reduction will lead to the improvement of the investment climate, will increase the volume of lending to the economy.
This post is also available in Russian: О проблемах российской экономики