23 November 2017
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AMBASSADOR'S ARTICLES

06.03.2017

The growing Russian economy is increasingly open for business (article by Ambassador Yakovenko for The Daily Telegraph, 6 March 2017)

Tough challenges, including weak global growth, low energy prices and Western sanctions have been used by the Russian Government as incentives to make difficult, but sound decisions to keep our economy in shape. Most of the problems have been overcome, and we have adapted to the new, tougher trade and economic environment, that some call deglobalisation.

While Russia’s GDP fell by 3.7pc in 2015, last year the contraction was insignificant (0.2pc), and we witnessed a transition to growth already in the third quarter of 2016. Now experts have to admit that the results surpass most predictions, and fundamentals of the Russian economy have strengthened. GDP is expected to grow between 1 and 2pc this year.

The Russian Government has been working hard to minimise negative external effects and to secure a structural transformation of the economy. A well-timed anti-crisis programme was launched and has proved successful. The Government is actively scaling down the dependence on commodities and implementing structural reforms. We have maintained macroeconomic stability, preserved and even enlarged our financial reserves. As of 1 January 2016, the reserves stood at around $370 bn, and now there are almost $400 bn.

Public debt is low. Obligations for external debt repayment will have decreased from $130 bn in 2015 to $80 bn by the end of 2017. The federal budget deficit remains at safe level and will be financed by loans, which should not exceed the ceiling of 17pc of GDP. That is much lower than in EU member states. Despite the difficulties, the Government is meeting all of its social obligations in full. The unemployment rate stays reasonable.

Russian financial authorities have been doing an important job in stabilising the markets and bringing inflation down. The inflation rate has steadily decreased and has a potential to meet the 4pc target by the end of this year. Foreign direct investment inflow increased from $6 bn in 2015 to more than $25 bn last year. At the same time, capital outflow decreased from $150 bn. in 2014 to $15.5 bn. in 2016. Industrial production growth rates are expected to rise from 0.4pc in 2016 to 1.1pc in 2017 and up to 2.1pc in 2019.

Over past two years the financial stability of Russian banking system was restored. The profits of the Russian banks grew five-fold over the year. The volume of bad debt saw no increase. The loan portfolio remained stable without marked decrease. The dollarisation of the Russian economy (deposits and loans in US dollars) has been brought to 24pc, which is much less than in other emerging markets (in some countries this indicator is 60 to70pc).

Overall, the Russian economy is on a trajectory of sustained growth in the coming months making most international economists revise upwards their forecasts. We believe that foreign direct investment will increase substantially. We welcome major foreign companies and hedge pensions funds, which have serious long term interests in investing in the Russian economy, bonds and stock markets. In early February a leading global Russian agrocompany PhosAgro, which makes phosphate-based fertilizer, successfully completed its SPO at the Moscow Exchange, selling 4,5pc of its share capital for 15 bn roubles (about $250m) in just one hour. It is one example among many indicative of how Russia is viewed by international business.

The Russian Government is committed to providing every help and support to companies starting or continuing their business in Russia. Rouble devaluation has made Russian assets very attractive for purchase. Real sector companies, including agriculture, car and other industries, will benefit from localising their production in Russia.

I am confident 2017 will dramatically improve prospects for the Russian economy, raising its attractiveness further for foreign investors, including those from the UK.




LATEST EVENTS

19.10.2017 - Why to fight with memorials (by Ambassador Yakovenko for RT)

The campaign in Poland against World War II memorials to Soviet officers and soldiers, who had liberated the country from the Nazi occupation, is gaining momentum. Warsaw has created a legal framework allowing the disposal of Soviet/Russian memorial objects or taking them out of public sight, including the most widespread monuments of gratitude to the Red Army. Why?


18.10.2017 - Syria: collective humanitarian efforts, not sanctions, are needed more than ever (by Ambassador Yakovenko for RT)

The situation in Syria is undergoing serious transformation. Due to the de-escalation process, it has now become possible to drastically reduce the level of violence, to improve the humanitarian situation as well as to fight terrorists more efficiently. The ISIS-controlled territory is shrinking. On 14-15 September, at the international meeting in Astana all four de-escalation zones were finalized.


05.10.2017 - What You Have to Know about Status of Crimea (by Ambassador Yakovenko for RT)

The coup d’état in Kiev in February 2014 backed by the West tore up the constitutional space in Ukraine. The legitimate President of the country was overthrown. It was marked by a severe lack of democracy and violence that posed a direct threat to the well-being of Russian-speaking population of Crimea. Citizens of Crimea faced the choice of becoming an oppressed minority or severing their ties with the hostile regime to secure a future for themselves and their children. The decision to hold a referendum was made by legitimate local authorities. The independence of Crimea was proclaimed and an appeal to enter the Russian Federation was made based on the indisputable results of the popular vote. Standards of international law were fully observed as the right of nations to self-determination enshrined in the UN Charter was exercised freely by the Crimeans. Crimea was recognized as an independent and sovereign state by Russia and on 18 March 2014 in Moscow the two countries signed a Treaty of Unification, under which the Republic of Crimea and the city of Sevastopol became two new regions - subjects of the Russian Federation.


05.10.2017 - NATO increased military presence in Europe: road to nowhere (by Ambassador Yakovenko for RT)

As part of the implementation of the conclusions of the NATO Summit in Warsaw, four multinational battlegroups have been deployed in Poland, Estonia, Lithuania and Latvia with the total number of troops exceeding 4500. The idea of creating similar rotating units in Bulgaria and Romania in 2018 is being widely discussed by NATO members. If put together, these battlegroups amount to a motorized infantry brigade with heavy weapons.


30.09.2017 - Russia’s initiative on protecting SMM OSCE in South-East of Ukraine (by Ambassador Yakovenko for RT)

On 5th September, at the 9th BRICS Summit in Xiamen President of the Russian Federation Vladimir Putin has announced an initiative to establish the United Nations Mission on Support in Protecting the Special Monitoring Mission (SMM) OSCE in the South-East of Ukraine.


25.09.2017 - Eurasian Economic Union today (by Ambassador Yakovenko for RT)

Though hardly noticeable in the Western media, the Eurasian economic cooperation is booming, with the Eurasian Economic Union (EAEU) becoming an increasingly effective integration project. The unique format of enhanced economic coordination along with the EAEU member states’ retained political sovereignty and cultural identity is proving itself.


25.09.2017 - On Russia's assistance to Central Asia (by Ambassador Yakovenko for RT)

Russia attaches great importance to the issue of sustainable development as it is underlined by the UN. Among our priorities in this area is the development of Central Asia. We contribute to the development of this region on a regular basis, regardless of the global economic crisis and its negative effect on Russia’s economy. In today’s world, international aid is often politically motivated and aimed at exerting one’s influence. Russia has a different approach.


25.09.2017 - IX BRICS Summit – turning into a global organisation (by Ambassador Yakovenko for RT)

The 9th BRICS summit in Xiamen, China, has emphasized the proximity of positions of the member states on the current global problems. It demonstrated that over the last 10 years BRICS has grown into a full-fledged international mechanism for global cooperation.


08.09.2017 - SCO sets standards for countering extremism (by Ambassador Yakovenko for RT)

In June 2017, the leaders of the Shanghai Cooperation Organisation (SCO) signed the SCO Convention on Countering Extremism, which will help strengthen the international legal framework to address new challenges and threats as well as increase the effectiveness of cooperation between relevant authorities of the member states and to improve legislation in this area.


07.09.2017 - No alternative to a peace settlement on the Korean Peninsula (by Ambassador Yakovenko for RT)

Russia is deeply concerned over the situation on the Korean Peninsula, where confrontation is moving into its hottest phase than ever before. North Korea continues to violate UN Security Council resolutions.



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