Surpassing of Last Year’s Growth Rates of Investments into Capital Assets is Hardly Possible

The situation in the investment area remains rather complicated despite the fact that in November 2013 the growth rates of investments in capital assets year on year entered the positive area and amounted to 100.2% after a sustained drop in the past three months.


By now, the data on the volumes and structure of investments in capital assets in January-September 2013 was published by Rosstat. Reduction of investments in capital assets in 2014 is quite predictable and was determined by rather low business activities late in 2012.


Despite a low base of last December, on the basis of the results of 2013 surpassing of the values of annual growth rates of 2012 is hardly possible. Stabilization of investments in capital assets in the 1st quarter of 2013 at the level of the previous year was replaced by a drop of 1.7% and 1.2% in the 2nd quarter of 2013 and the 3rd quarter of 2013, respectively, against the respective quarter of the previous year.


On the basis of the results of January-September 2013, investments in capital assets and the volume of fulfilled jobs in building amounted to 98.6% and 98.9%, respectively, against the indices of the same period of 2012. In January-September 2013, the share of investments in GDP amounted to 16.6% and was 0.5 p.p. lower than in the respective period of the previous year.


Changes in the pattern of investments in capital assets in January-September 2013 were determined by a dramatic drop in building and investment activities in industry and transport which aggregately account for nearly 70% of investments in the economy. The volume of investments in transport amounted to 81.5% of the index of January-September 2012 which situation is related, on one side, to completion of large investment projects, while, on the other side, to a decrease in investments in railway transport in a situation where cargo carriage volumes have decreased, financial performance of railway transport entities fell by 63.9% and their profitability, to 3.3% against 7.8%.


A drop in the volumes of building jobs with growing rates of commissioning of housing and reduction of volumes of incomplete building may result in a dramatic shrinkage of business activities in the building and investment complex early in 2014.


О.I. Izryadnova, Head of the Structural Policy Department