Improvement in Expectations of Economic Agents Cannot be Expected

On September 27, The Problems of the Russian Economy: Political and Economic Outlook Conference under the auspices of the Association of Independent Centers for Economic Analysis was held in Moscow. Participants in the conference discussed key social and economic issues of the Russian economy, as well as challenges and limitations faced by the current economic policy pursued by the government.

In particular, in its report dedicated to relations between the business and authorities Andrei Yakovlev, Director of the Institute of Analysis of Enterprises and Markets of the NRU HSE expressed an opinion that even with the existing unfavorable conditions the Russian economy can achieve pre-crisis economic growth rates at the level of 5%-7%. According to Andrei Yakovlev, at present both the population of Russia and the business have sufficient financial resources to make those 5%-7% a reality. However, much depends on expectations of economic agents as regards political decisions of the authorities.

One cannot but agree with Andrei Yakovlev's opinion unless there was one important "but": economic agents' expectations are far from being optimistic ones. Alas, with the present quality of institutes and the social and economic situation neither the business, nor the population is interested to invest in the domestic economy. It is for that reason according to the official statics data a large-scale brain drain and capital flight from Russia were observed recently. In the existing political and economic situation, the activities of those who stayed in Russia are mainly reduced to survival, while the survival strategy contributes in no way to growth in economic efficiency and, consequently, development of sustained economic growth rates in prospect.


In addition to the above, experts point out that the real sector fails to meet investors' requests, in other words, additional investments in the economy are not utilized in full. It is known that over 55% of all the enterprises' funds idle on termed deposits with banks and happen to be withdrawn from the economy.


So, it is worth underlining again that the authorities' priority should consist not in securing by all means high growth rates of GDP, but in creating of prerequisites for strengthening of fundamental factors which result not only in high economic growth rates, but also growth at a different quality level.


М.V. Kazakova, PhD (Economics), Head of the Economic Development Department