Dmitry Chirkin: Russia experienced technological decline during its economic rise

The Russian government discussed the schedule for the implementation of the socio-economic development program for the period of 2002-2004 today. Premier Mikhail Kasyanov declared after the session that the government is intending to strive for the reduction of the inflation rate this year.

The economic growth made up 5.5% last year, and over 8% in 2000. The industrial output increased, and the black ink made up $50 billion. Russia paid $13 million to the USA, and the Russian gold and currency reserves gained ten billion dollars. After the radical tax reform and after the reduction of the taxes for enterprises, the parliament approved the new Labor Code.

Therefore, Kasyanov's optimistic views are understandable. However, there is completely different information coming from other sources, which is basically negative information. Andrey Illarionov believes that the current economic stability in the country was more of a virtual character than real, since it was caused by the high world oil prices. Russia was gaining up to 40% of its currency income owing to oil exports. “We are still living on petrodollars,” – Illarionov claimed.

The economic growth during the last couple of years is so impressive because it followed a very critical period for Russia, which started in 1998. The collapse of the Russian economy attracted the world’s attention. However, if we assume that Russia’s economy will gain 5% each future year, then our country will be able to catch up with Portugal only, the poorest country of the European Union after Greece. It is rather offensive to be compared with Portugal, but this is the way it is. Economic stability, which has been in our dreams for so long, may tumble down like a castle of sand. Two years have been spent for nothing, and it is not only presidential aide Andrey Illarionov who realizes this. “Our industry is unable to meet the domestic demand,” – premier Kasyanov stated at the end of December of 2001.

Defense technology and vaccines and are among those goods that have kept their competitive value on the world market. Regarding the high tech industry and consumer goods, such as VCRs and televisions, any Russian citizen who has the money for such items will buy a foreign product. Russia has experienced a technological decline during its economic rise. Foreigners are ready to deliver those goods to Russia that are totally not in demand in their own countries. Isn’t this offensive? What is going to happen after Russia is incorporated into the World Trade Organization?

The Kommersant economic newspaper wrote that Russia's economic rise had almost stopped. When premier Kasyanov was summing up the results of the year, he projected a 4% rise in the year 2002. However, it may be that it will not be possible to overcome even 1%, Minister for Economic Development and Trade German Gref thinks.

Dmitry Chirkin PRAVDA.Ru

Translated by Dmitry Sudakov