Russian economy still shrinking
First quarter results show that the Russian economy continues to fall. That forces Russian federal authorities to cut budgets to the bone.
Both industrial production, investments, construction and trade continues to shrink. According to figures from the Russian Statistics Service, Rosstat, the negative trend in March was practically unchanged compared with January. The first quarter results show that industrial production shrunk 14,3 percent, investments – 15 percent, transported goods – 17,4 percent and construction – 19,3 percent, Vedomosti reports.
Meanwhile, consumer prices increased 13,7 percent. Retail trade was down 1,1 percent and people’s incomes – 2,3 percent down.
The negative figures bring the Russian economy down with eight percent. That is far more than anticipated by Finance Minister Sergey Kudrin, who now again might have to review the government prognosis and budget plans.
Meanwhile, the Russian government cuts budgets. As confirmed by Deputy Finance Minister Tatyana Nesterenko, failed customs and tax revenues will reduce this year’s federal incomes with about 800 billion RUB, which is 12 percent of the government’s total budgeted 2009 incomes, Vedomosti reports.
As reported by BarentsObserver, the government this week revised the federal budget leaving it with a deficit of about 2.9 trillion RUB.
