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Tag Archive for Economy

The oil price is all that matters regarding Russia

Oil Well file photo

(Business New Europe – bne.eu – Chris Weafer – December 19, 2014) Chris Weafer is Senior Partner at Macro-Advisory, which offers bespoke Russia-CIS consulting. The key takeaway concerning the economy and the ruble from President Valdimir Putin’s press conference on December 18 is that the Kremlin does not have any strategy or plan to try

How does the 2014 ruble crisis compare with the 1998 vintage?

File Photo of Cash, Coins, Line Graph

(Business New Europe – bne.eu – Ben Aris in Moscow – December 17, 2014) The ruble’s crash on December 15 from RUB53 to nearly RUB80 vs the dollar has caused many commentators to compare this crisis to Russia’s financial collapse in 1998. Is Russia really going into a full-scale meltdown for the fourth time in

Russia doomed to recession (excerpt)

File Photo of Cash, Coins, Line Graph

(Business New Europe – bne.eu – Ben Aris in Moscow – December 19, 2014) [Full text and charts here http://www.bne.eu/content/story/russia-doomed-recession] 1.0 Economics 1.1 Economics overview The mood amongst Russia watchers is as black as it has always been in the midst of one of Russia’s major crises. The forecasts for 2015 are almost – but not unanimously

Russian Media Downplay Extent of Ruble Crisis

File Photo of Cash, Coins, Line Graph

(Moscow Times – themoscowtimes.com – Howard Amos, Ivan Nechepurenko – December 17, 2014) While the ruble pinballed erratically between 58 and 80 per U.S. dollar on Tuesday, making headlines around the world, Russia’s state-run media have attempted to take a soft and conciliatory stance on the home currency’s woes. A news bullet by state-owned Channel

What awaits Russia’s economy in 2015 after ruble collapse?

Oil Well file photo

(Russia Beyond the Headlines – rbth.ru – Konstantin Korishchenko, special to RBTH – December 17, 2014) Konstantin Korishchenko is head of the stock market and financial engineering department at the Finance and Banking Faculty of the Russian Presidential Academy of National Economy and Public Administration, and a former deputy chairman of the Russian Central Bank.

Medvedev says ruble ‘undervalued’ as slide slows

File Photo of Dmitry Medvedev with United Russia Logos Behind Him

(Business New Europe – bne.eu – bne IntelliNews – December 17, 2014) Russian Prime Minister Dmitry Medvedev called the ruble undervalued at a meeting on December 17 with the top officials of the government, the central bank and heads of Russia’s largest exporters. He said that regulation of the currency market would remain based on

Picking through the ruble

Russian Central Bank file photo

(Business New Europe – bne.eu – MOSCOW BLOG: Ben Aris in Moscow – December 16, 2014) The Russian ruble crashed again on December 15, in the biggest fall since the last big crisis in 1998. The Central Bank of Russia (CBR) belatedly stepped in with a huge interest rate hike overnight, but it has been

Fears of Capital Controls Grow as Russia’s Economy Goes Haywire

File Photo of Cash, Coins, Line Graph

(Moscow Times – themoscowtimes.com – Howard Amos – December 17, 2014) The possible implementation of capital controls in Russia came a step closer Tuesday as the authorities appeared to be running out of options to stem the country’s dramatic currency collapse. The ruble defied an emergency interest rate rise of 6.5 percentage points announced overnight,

Business New Europe: What price European values when economic collapse is imminent?

EU Map

(Business New Europe – bne.eu – KYIV BLOG: Ben Aris in Moscow – December 15, 2014) Ukraine needs about $15bn now or it will collapse, possibly in the next few weeks. Ukraine’s prime minister, Arseniy Yatseniuk, called on Western donors to come up with a $15bn rescue package to stave off collapse on December 11

Yavlinsky calls for returning Kudrin to government

Alexei Kudrin file photo

(Interfax – December 13, 2014) Grigory Yavlinsky, a founder of the Yabloko party, calls for replacing the Russian government and appointing former Finance Minister Alexei Kudrin a new prime minister or first deputy prime minister with a special mandate. “We believe the government needs to be changed – whether it’s going to be the entire

Business New Europe: “Better late than never?”

File Photo of Cash, Coins, Line Graph

(Business New Europe – bne.eu – MOSCOW BLOG: Ben Aris in Moscow – December 12, 2014) There is an obvious solution to help deal with Russia’s economic slowdown that is being exacerbated by the tumbling oil prices: do those reforms that should have been done ten years ago. It’s kind of obvious. But also just

Business New Europe: Flippant claim that ‘Russia is Spain’ is wide of the mark

Cash, Calculator, Pen

(Business New Europe – Henry Kirby in London – December 11, 2014) After months of downward pressure, the ruble went into near free-fall during the first week of December. From 36 to the dollar in early August, the Russian currency fell rapidly from 47 to 53 to the greenback in just a few days, amid

Business New Europe: Russia is running out of money – not…

File Photo of Cash, Coins, Line Graph

(Business New Europe – bne.eu – MOSCOW BLOG: Ben Aris in Moscow – December 11, 2014) There has been a spate of articles recently suggesting that Russia is on the edge of a complete economic meltdown. There was an article in the UK’s The Daily Telegraph suggesting that its economy has lost a third of

Moscow Times: Life After Putin: Teaching Future Russia

Skolkovo File Photo

(Moscow Times – themoscowtimes.com – Alexey Eremenko – December 11, 2014) The professional future is bright in Russia, where space geologists and airship constructors will be among the most in-demand professionals by the 2020s, according to an atlas of Russia’s future job market recently published by Skolkovo’s Moscow School of Management. But whether Russia will

Russia Beyond the Headlines: Medvedev urges Russia to address dependence on world oil prices

Oil Worker file photo

(Russia Beyond the Headlines – rbth.ru – Alexei Lossan, RBTH – December 11, 2014) In an address broadcast on Russia’s main TV channels, Prime Minister Dmitry Medvedev has said the country needs to wean itself off its dependence on oil prices. In order to accomplish this, Russia needs to develop innovative projects and use the

Moscow Times: Medvedev: In 2014, Crimean Annexation, Sochi Olympics Outshone Grim Economic Situation

Dmitry Medvedev file photo

(Moscow Times – themoscowtimes.com – Ivan Nechepurenko – December 11, 2014) Prime Minister Dmitry Medvedev struck an optimistic note throughout a 1 1/2-hour news conference Wednesday, drawing attention to what he viewed as Russia’s crowning achievements of this year: the Sochi Olympic victory and the annexation of Crimea. Medvedev spoke about a wide array of

Russian Ruble’s 800-Year History Haunts Current Plunge

Cash, Calculator, Pen

(Moscow Times – themoscowtimes.com – Howard Amos – December 11, 2014) Sergei Sorokoumov has devoted the last quarter of a century to an attempt to raise Russian’s pride in the ruble, the country’s national currency since the 13th century. Recently Sorokoumov’s efforts seem to have become a thankless task. The Russian currency has lost over

Ruble Collapses, Russians Yawn

File Photo of Cash, Coins, Line Graph

(Bloomberg – thebloomberg.com – Leonid Bershidsky – December 9, 2014) With the ruble down 40 percent against the dollar so far this year, and down more than 14 percent in the last 30 days, one might have expected widespread economic panic among Russians. But there’s been nothing of the kind. It’s been business as usual

New Ukraine government pledges to ‘utterly transform’ economy

Maidan Square file photo

(Business New Europe – bne.eu – December 10, 2014) Prime Minister Arseny Yatsenyuk announced on December 9 that his new government would embark on a programme of sweeping reforms to “utterly transform” Ukraine’s economy. “Our answer is decentralisation, deregulation, de-bureaucratisation and responsibility of each government official,” he said when presenting his Action Programme at a

Putin’s New Deal Spells End to 15 Years of Wage Gains

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(Bloomberg – bloomberg.com – Henry Meyer, Agnes Lovasz, Evgenia Pismennaya – December 8, 2014) Vladimir Putin’s confrontation with the U.S. and Europe augurs a new deal for his 144 million subjects. Instead of the rising living standards he’s delivered the past 15 years in exchange for the public’s acquiescence, the Russian president now holds out

Moscow Times: Putin Promises Controlled Freedom in Face of Western Containment

Kremlin and Saint Basil's File Photo

(Moscow Times – themoscowtimes.com – Ivan Nechepurenko – December 5, 2014) President Vladimir Putin told the nation on Thursday that Russia’s ongoing clash with the West – which he compared to Hitler – was inevitable and will only make the country stronger by mobilizing its economy and society around common goals and traditional moral values.

Putin’s Luck Runs Out

File Photo of Vladimir Putin Seated at Desk

(RFE/RL – rferl.org – Brian Whitmore – December 3, 2014) Vladimir Putin has been on quite a roll for about a year now. But December 1, 2014, just might turn out to be the day the tide finally turned against him. Ever since Russia’s annexation of Crimea in March sparked the worst East-West showdown since

Russia Beyond the Headlines: Is Russia’s middle class suffering as sanctions bite?

Cash, Calculator, Pen

(Russia Beyond the Headlines – rbth.ru – Bryan MacDonald, special to RBTH – December 4, 2014) Sanctions, unilaterally imposed by western nations, are supposedly causing economic problems in Russia. Bryan MacDonald investigated whether these claims are true and found that ordinary Russians had mixed opinions. Reading some western media outlets, you’d think Russia’s economic sky

Five Forces Battering Russia’s Economy as Putin Faces Nation

File Photo of Cash, Coins, Line Graph

(Moscow Times – themoscowtimes.com – Howard Amos – December 4, 2014) President Vladimir Putin’s annual state of the union address on Thursday takes place at a time of economic pain and international isolation unprecedented during the Russian leader’s almost 15-year political dominance. More than 1,000 senior government officials will gather in the Kremlin to hear

The Question Russians Are Asking that Putin Can’t Answer

File Photo of Vladimir Putin at Valdai Club 2013 Meeting, Adapted from Screenshot of Valdai Club Video at youtube.com

(Window on Eurasia – Paul Goble – Staunton, December 4, 2014) President Vladimir Putin’s speech to the Federal Assembly is the subject of intense interest for the light it will shed on where the Kremlin leader is headed next. But there is one question Russians are asking that he cannot possibly answer without calling into

Crash Course: The Ruble’s Volatile Two Decades

File Photo of Cash, Coins, Line Graph

(RFE/RL – rferl.org – Carl Schreck – December 02, 2014) The Russian ruble’s sharp plunge this week, which saw it fall below 50 to the U.S. dollar, has revived the specter of the kind of currency crisis that Russians have suffered through repeatedly over the past 25 years. The ruble on December 1 took its

The Battle for the Siberian harvest

Map of Russia

(opendemocracy.net – Georgy Borodyansky – November 28, 2014) Georgy Borodyansky is an Omsk-based correspondent for Novaya Gazeta. President Putin’s special envoy to the Urals, recently praised the region’s farmers for their heroic efforts to save the harvest. But it won’t save them. President Putin’s special envoy to the Urals, recently praised the region’s farmers for

Interfax: U.S. Department of Agriculture raises Russian grain harvest forecast to 102 mln tonnes

Field of Grain file photo

MOSCOW. Dec 1 (Interfax) – the U.S. Department of Agriculture’s Foreign Agricultural Service raised its forecast for Russia’s grain harvest in the current farm year (July 2014-June 2015) by 1 million tonnes to in November to 102 million tonnes. It raised its estimate for grain exports by 1.5 million tonnes of 29.5 million tonnes. The

Western sanctions could cost Russia up to $170 billion, say analysts

File Photo of Cash, Coins, Line Graph

(Russia Beyond the Headlines – rbth.ru – Alexei Lossan, RBTH – December 1, 2014) Russia’s overall losses due to Western sanctions over Ukraine amount to $40 billion, Russian Finance Minister Anton Siluanov has said. A further $90-100 billion will be lost because of the 30-percent drop in oil prices. According to Russian experts, rising inflation

Ukrainians Cannot Count on Sanctions or Falling Oil Prices to Stop Putin, Illarionov Says

Ukraine Map and Flag

(Window on Eurasia – Paul Goble – Staunton, December 2, 2014) Many in Ukraine and elsewhere think that falling oil prices or increased Western sanctions or more sensible people in his entourage will convince Vladimir Putin to change course and end his aggressive policies, but they are wrong because none of these things will affect

Russia Beyond the Headlines: Beijing and Brisbane meetings see Russia boost economic ties with BRICS

File Photo of Flags of BRICS Nations and BRICS Logo from Past Summit

(Russia Beyond the Headlines – rbth.ru – Nikolay Surkov, Gevorg Mirzayan, RBTH – November 24, 2014) The recent APEC and G20 summits yielded important dialogue between Moscow and the West on the Ukrainian crisis and a further strengthening of ties between Russia and its BRICS partners, though relations with West remain strained, as global media

Interfax: Russian Investigations Committee drafts measures to slow down capital flight

File Photo of Cash, Coins, Line Graph

(Interfax – November 24, 2014) Russian Investigations Committee has prepared its own proposals allowing to “considerably slow down” the capital flight from Russia, the committee’s head Aleksandr Bastrykin has said, as reported by privately-owned news agency Interfax on 24 November. “We are so wealthy and powerful that we will be able to cope with problems

Europe’s Biggest Mall Opens in Moscow Amid Economic Decline

Aerial View of Moscow From Beyond Stadium, file photo

(Moscow Times – themoscowtimes.com – Gabrielle Tétrault-Farber – December 1, 2014) Two days after Europe’s largest shopping mall opened its doors in northwest Moscow at the height of economic woes and the ruble’s free fall, there seemed to be more window-shopping than spending happening at Aviapark. The new shopping center built near the site of

Ukraine Shrugged Off as Russia ETF Swells to Record

File Photo of Cash, Coins, Line Graph

(Bloomberg – bloomberg.com – Elena Popina – November 24, 2014) As oil fell into a bear market, the ruble traded at record lows and NATO said President Vladimir Putin is stoking conflict in Ukraine, bets on the biggest exchange-traded fund tracking Russian stocks surged to a record. Demand for shares in the Market Vectors Russia

Russian Oil-Output Cuts to Support OPEC Seen as Unlikely

Oil Well file photo

(Bloomberg – bloomberg.com – Stephen Bierman, Elena Mazneva – November 26, 2014) Each time oil takes a dive, the idea of Russia allying with OPEC to shore up prices gets an airing. It happened in the months after 9/11 and again during the 2008 financial crisis. Now it’s back on the agenda. Russia’s top two

Interfax: Kudrin suggests five steps towards effective Russian economy amid sanctions

Alexei Kudrin file photo

(Interfax – November 21, 2014) Russia may see a growth and develop every sphere of public life even under the sanctions, said Committee of Civil Initiatives Chairman Alexei Kudrin. “There is always a wish to have a simple recipe: five steps that can make a great change. I have to admit there is no such

TRANSCRIPT: Text of Ambassador Pyatt’s Panel Comments at the Kyiv Post Tiger Conference WEF Panel

Geoffrey R. Pyatt file photo

(US Embassy Ukraine – November 19, 2014) I think with government servants like Hanna Hopko and Dmytro (Shymkiv), you get a sense of Ukraine’s direction. I think the greatest single risk factor is business as usual. It’s the assumption in some circles that Ukraine can keep doing as it had been doing in the past.

The Tale of Two Crises (re The Economist)

File Photo of Cash, Coins, Line Graph

Subject: The tale of two crises (re The Economist) Date: Thu, 20 Nov 2014 From: Ben Aris <baris@bne.eu> I would like to comment on two sets of pieces you ran from the Economist on eastern European woes on JRL#241. I know I keep taking pops at the Economist and I try not to as I

Russia Sees Recession Next Year If Oil Price Falls to $60

Oil Well file photo

(Bloomberg – bloomberg.com – Olga Tanas – November 18, 2014) Russia’s economy will sink into a recession next year if the price of oil slumps to $60 a barrel and the U.S. and its allies tighten sanctions over the conflict in Ukraine, Finance Minister Anton Siluanov said. The economy of the world’s largest energy exporter

Russia’s energy ministry revises oil price to $80-$90 per barrel

Oil Well file photo

(Business New Europe – bne.eu – bne/IntelliNews – November 20, 2014) Russia’s energy ministry has revised the outlook for global oil prices downwards from previous $95 per barrel to $80-$90 per barrel, deputy minister Kirill Molodtsov told the press, without specifying the time frame of the outlook. Currently the ministry is witnessing surplus demand in

McDonald’s Moscow Restaurant Reopens After 3-Month Shutdown

File Photo of Russian McDbnald's Crew with U.S. Diplomat

(Bloomberg – bloomberg.com – Leslie Patton, Ilya Khrennikov – November 19, 2014) McDonald’s Corp.’s (MCD) largest restaurant in Russia reopened after local officials shuttered the location for three months, an optimistic sign for a company trying to return to business as usual in the country. The outlet, situated in Moscow’s Pushkin Square, resumed business today,

Sanctions Affect Half Of Russia’s Banking Sector, Report Says

Cash, Calculator, Pen

(Moscow Times – themoscowtimes.com – November 19, 2014) Russian banks are the most vulnerable among the world’s large emerging market economies due to Western sanctions and near zero levels of economic growth, a Standard & Poor’s report released Wednesday said. Sanctions directly affect more than 50 percent of Russia’s banking sector, which is dominated by

Interfax: Russian central banker says economy can withstand lower oil price, sanctions

Elvira Nabiullina file photo

(Interfax – November 18, 2014) The head of the Russian Central Bank, Elvira Nabiullina, has said that the economy would retain stability if things go less than well, i.e. if oil prices averages 80 dollars per barrel and sanctions continue until the end of 2017. Speaking in the State Duma on 18 November, she added

Russia moves to free-sinking currency

File Photo of Cash, Coins, Line Graph

(Business New Europe – bne.eu – Ben Aris in Moscow – November 19, 2014) After controlling the ruble-dollar exchange rate for more than two decades to ease the pain of the transition to a free market, on October 9 the Russia’s central bank finally let the ruble go. The Russian currency is now a fully

Ten Kremlin Moves That Hurt Russia’s Economy

File Photo of Cash, Coins, Line Graph

(Moscow Times – themoscowtimes.com – Alexey Eremenko – November 19, 2014) As the Russian economy ambles toward recession, the government grapples with how to explain the downturn – no easy feat after 15 years of slowly mounting prosperity and President Vladimir Putin’s campaign promises of lavish social spending. So far, the authorities have been inclined

Putin Said to Stun Advisers by Backing Corruption Crackdown

Cropped File Photo of Two Men in Business Suits Shaking Hands and Passing Cash

(Bloomberg – bloomberg.com – Evgenia Pismennaya, Irina Reznik- November 19, 2014) Vladimir Putin sat motionless as the minister, seizing on the Russian leader’s first major meeting with his economic team in months, itemized the challenges. A recession is imminent, inflation is getting out of hand and the ruble and oil are in freefall, Economy Minister

2015 looks likely to be Russian economy’s “Annus Horribilis”

File Photo of Cash, Coins, Line Graph

(Business New Europe – bne.eu – Chris Weafer – November 18, 2014) Chris Weafer is Senior Partner at Macro-Advisory, which offers bespoke Russia-CIS consulting. In a memorable speech delivered in late 1992, Britain’s Queen Elizabeth II described the year just ending as an “Annus Horribilis” as she referred to a year filled with misery and

Early shift to free-floating policy gives shelter to battered Russian ruble

File Photo of Cash, Coins, Line Graph

(Russia Beyond the Headlines – rbth.ru – Alexei Lossan, RBTH – November 17, 2014) Since the beginning of 2014 the value of the ruble has fallen by about 50 percent against the dollar and the euro, a slide most analysts attribute to low oil prices. In the end, Russia’s Central Bank decided to bring forward

Profile: Elvira Nabiullina, Woman at Center of Russia’s Ruble Collapse

Elvira Nabiullina file photo

(Moscow Times – themoscowtimes.com – Howard Amos – November 15, 2014) Reaching the climax of a personal attack on Russia’s Central Bank chairwoman Elvira Nabiullina in a debate in the State Duma early last week, Communist deputy Vyacheslav Tetyokin did not hold back. Nabiullina, he said, was “the most expensive woman in the history of

Most of Russians believe support for Ukraine separatists to cause economic crisis, still support government actions

Map of Commonwealth of Independent States, European Portion

(Business New Europe/IntelliNews – bne.eu – November 12, 2014) More than half of Russians now believe that the annexation of Crimea and Russia’s support for separatists in eastern Ukraine will lower their standard of living and cause an economic crisis in Russia, but even so they continue to back their government’s actions, according to survey

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