Russian Prime Minister: Main Task for Current Year Is Reducing Inflation to Predicted Level

One of the Russian Government's main goals for the last quarter of the current year is to lower the annual inflation rate to 14%, the figure it had previously predicted. Russian Prime Minister Mikhail Kasyanov made this announcement today at a briefing of journalists.

According to the Government's press department, Kasyanov also said that a solid platform needs to be created in the last quarter of this year so that inflation in 2003 will not exceed 12%, 'or, perhaps, will be even lower'. He also highlighted the fact that economic growth for the year will not be 3.6% as previously predicted, but 3.9%. Nevertheless, he said that 'the economy is displaying trends that concern the Government'. In particular, industrial growth is of a very unstable nature. The level of investment is also lower than had been forecast. Kasyanov identified the weakness of the banking sector, which is not supplying a large enough flow of capital, as one factor restricting a rise in investment. In connection with this, before the end of the year the Government is planning to look at the issue of developing the banking sector.

In the autumn, ministers will also analyse the financial plans and budgets of the natural monopolies in order to approve their tariffs, outlay and expenses, as well as discussing bills for reforming the railways and the electricity industry.