UN Estimates Russian Economy 2003 Growth Rate at 4%

The development rates of the world economy in 2003 will be 2.75 percent against 1.7 percent in 2002, forecasts the United Nations in a report published in Geneva.

As regards economic growth in different regions, the forecast predicts these rates: 4 percent in Russia and countries of East Europe, 3 percent in the United States, 2.1 percent in countries of the European Union, 1 percent in Japan, and as much as 7 percent in China. In developing countries on an average it will be slightly above 4 percent, including 2.3 percent in Latin America, 5.6 percent in Southeast Asia, and 4 percent in Africa.

UN experts make a reservation that a set of factors may affect their prediction. It is not only a possible military conflict in Iraq, whose threat has already provoked rises in oil prices and undercut the trust of the business circles and consumers.

The UN report stresses that the expected economic revival is hostage to a series of risks and the governments have limited capabilities to respond. The main obstacles standing in the way of speeding up economic development in the world are, in the opinion of UN experts, the surplus of production capacities, unjustifiably high cost of assets, lack of trust from potential investors, and a structural imbalance of the world economy.

The UN reports says that drawn-out depression on stock markets may be accompanied by a lengthy period of slow economic growth and may even minimize it. Among the potential braking factors UN experts also cite the deficit of the American balance of trade and the low rate of the dollar.