Description: Moderating Risks, Bolstering Growth

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Moderating Risks, Bolstering Growth

Half a year ago, Russia's economic prospects looked uncertain. The global economy was losing momentum, the expansion in the euro area was grinding to a halt and commodity prices were beginning to fall. Yet, while output growth is slowing this...

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Bibliographic Details
Main Author:	World Bank
Language:	English en_US
Published:	Washington, DC 2013
Subjects:	ADVANCED ECONOMIES AGRICULTURE ASSET POSITION BALANCE OF PAYMENTS BALANCE SHEETS BANK LENDING BANK LIQUIDITY BANKING SECTOR BANKING SUPERVISION BARRIERS TO ENTRY BARRIERS TO GROWTH BASIS POINTS BOND BOND SETTLEMENT BUDGET DEFICIT BUDGET SURPLUS BUSINESS ENVIRONMENT CAPACITY CONSTRAINTS CAPITAL ACCOUNT CAPITAL ACCUMULATION CAPITAL FLOWS CAPITAL INFLOWS CAPITAL INVESTMENT CAPITAL OUTFLOWS CDS CENTRAL BANK COLLATERAL COMMODITY COMMODITY PRICES COMPETITIVE ADVANTAGE CONFIDENCE INDEX CONSUMERS CONSUMPTION LEVELS CORPORATE BORROWERS CPI CREDIT DEFAULT CREDIT DEFAULT SWAPS CREDIT EXPANSION CREDIT GROWTH CURRENCY CURRENT ACCOUNT BALANCE CURRENT ACCOUNT DEFICIT CURRENT ACCOUNT SURPLUS CURRENT ACCOUNT SURPLUSES DEBT CRISIS DEBT LEVELS DEBT REPAYMENTS DEBT SERVICE DEFICITS DEPOSIT DEPOSIT RATE DEPOSIT RATES DEPOSITS DEVELOPING COUNTRIES DEVELOPING COUNTRY DISBURSEMENTS DISPOSABLE INCOME DOLLAR VALUE DOMESTIC DEBT ECONOMIC ACTIVITY ECONOMIC CRISIS ECONOMIC DEVELOPMENT ECONOMIC DEVELOPMENTS ECONOMIC EXPANSION ECONOMIC GROWTH ECONOMIC OUTLOOK ECONOMIC PERFORMANCE ECONOMIC POLICIES ECONOMIC SITUATION ELASTICITY EMERGING ECONOMIES EMERGING MARKETS ENERGY EXPORTS EQUIPMENT EXCHANGE RATE EXPENDITURE EXPENDITURES EXPORT SECTOR EXPORTS EXPOSURE EXTERNAL DEBT EXTERNAL FINANCING FEDERAL BUDGET FINANCIAL MARKETS FINANCIAL SECTOR FINANCIAL SERVICES FISCAL CONSOLIDATION FISCAL DEFICIT FISCAL POLICY FIXED CAPITAL FIXED INCOME FIXED INCOME SECURITIES FIXED INVESTMENT FIXED RATE FLEXIBLE EXCHANGE RATE FOOD PRICE FOREIGN ASSET FOREIGN ASSET POSITION FOREIGN ASSETS FOREIGN CURRENCY FOREIGN DIRECT INVESTMENT FOREIGN EXCHANGE FOREIGN EXCHANGE RESERVES FORESTRY GDP GDP PER CAPITA GLOBAL CAPITAL GLOBAL ECONOMY GLOBAL MARKET GLOBAL RISK GLOBAL TRADE GOVERNMENT BONDS GOVERNMENT DEFICIT GROUP LENDING GROWTH POTENTIAL GROWTH PROJECTIONS GROWTH RATE GROWTH RATES HOUSEHOLD INCOME INCOME GROWTH INCOME LEVEL INCOME LEVELS INCOMES INDEXATION INFLATION INFLATION RATE INFLATION TARGETING INTERGENERATIONAL EQUITY INTERNATIONAL STANDARDS INVENTORIES INVENTORY INVESTING INVESTMENT CLIMATE INVESTMENT FLOWS INVESTMENT INCOME LABOR FORCE LABOR MARKET LABOR MARKETS LABOR PRODUCTIVITY LINES OF CREDIT LIQUID ASSETS LIQUIDITY LIVING STANDARDS LOAN LOANS TO INDIVIDUALS LOCAL GOVERNMENTS M2 MACROECONOMIC DATA MACROECONOMIC STABILITY MANUFACTURING INDUSTRIES MARKET CONDITIONS MARKET DEVELOPMENTS MARKET LIBERALIZATION MARKET RISK MINIMUM CAPITAL REQUIREMENTS MONETARY POLICY MONEY SUPPLY MORTGAGE MORTGAGE LENDING MORTGAGES NATURAL RESOURCES NET CAPITAL NET EXPORTS NOMINAL INTEREST RATE NON-PERFORMING LOANS NONPERFORMING LOANS OIL OIL PRICE OIL PRICES OPEC OUTPUT OUTPUT GAP PENSION PENSION FUND PENSIONS PER CAPITA INCOME POLICY MAKERS POLITICAL UNCERTAINTY PORTFOLIO POST-CRISIS PERIOD POWER PARITY PRICE FLOOR PRICE INCREASES PRICE STABILITY PRICE VOLATILITY PRIVATE CONSUMPTION PRIVATE CREDIT PRODUCERS PRODUCTIVITY GROWTH PROFIT MARGINS PUBLIC DEBT PUBLIC FINANCES PUBLIC SPENDING PURCHASING POWER QUOTAS REAL ESTATE REAL EXCHANGE RATE REAL INCOME REAL INTEREST REAL INTEREST RATE REAL INTEREST RATES REAL WAGES REGULATORS REMITTANCES REPLACEMENT RATES REPO RESERVE RESERVE FUND RESERVE FUNDS RESERVES RETURNS RISK AVERSION RISK FACTOR SHARE PRICE SHARE PRICES SHORT-TERM DEBT SOCIAL PROTECTION SOVEREIGN DEBT SOVEREIGN DEBT MARKETS STOCK MARKET STOCKS TAX TAX RATES TOTAL DEBT TRADE BALANCE TRADING TREASURIES TROUGH TURNOVER UNEMPLOYMENT UNEMPLOYMENT RATE UNEMPLOYMENT RATES WAGE GROWTH WAGES WAREHOUSE WORLD ECONOMY WORLD TRADE WORLD TRADE ORGANIZATION WTO
Online Access:	http://documents.worldbank.org/curated/en/2012/04/16251128/moderating-risks-bolstering-growth http://hdl.handle.net/10986/12379

Description
Summary:	Half a year ago, Russia's economic prospects looked uncertain. The global economy was losing momentum, the expansion in the euro area was grinding to a halt and commodity prices were beginning to fall. Yet, while output growth is slowing this year in line with weaker growth in Europe and elsewhere, Russia's latest economy performance has been solid, though aided by favorable oil prices. The economy returned to the pre-crisis peak towards the end of last year, supported by strong consumption, as growth held steady at the same rate as in 2010. In 2011, measured in current dollars, Russia's economy was the ninth biggest in the world, compared to the eleventh biggest in 2007. This year, Russia's output might exceed US$2 trillion. Equalizing for prices difference with purchasing power parity, Russia's economy is already the sixth biggest today. The current account looks strong thanks to a large surplus in the trade balance, and the Central Bank of Russia added again in 2011 to its stock of foreign reserves. Employment returned to pre-crisis levels even earlier than output, and wages grew at a solid pace. Inflation reached its lowest level in two decades. Inequality declined and consumption levels of low-income households improved. The fiscal balance returned to a surplus. And while average public debt levels in advanced economies exceeded 100 percent of growth domestic product (GDP) in 2011, Russia's public debt was no more than 10 percent of GDP. Economic policies can help to shore up Russia's resilience in a volatile economic environment, diversify its economy, and strengthen its growth potential. First, fiscal policy should be used to rebuild fiscal buffers while oil prices are high. This will not only help to prepare for the next crisis, but also make sure that fiscal policy does not become procyclical as the output gap closes. Furthermore, monetary policy should continue to focus on low inflation, and financial policies on strengthening oversight. Finally, removing structural barriers to growth can help to bolster investment and productivity. Improving the business environment will go a long way to make the most of the economic benefits of Russia's World Trade Organization accession in summer 2012.