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Ironically, all these uncertainties about Russia's future are happening after a year in which much of Russia's past economic disasters have been reversed. Russia is riding high on the wave of the world's cyclical economic recovery. Inflation is coming under control. Tax revenues have almost doubled and the budget is close to balance. The share of net exports has surged from close to zero in early 1998, to nearly 15% of GDP. This has helped lift the country's GDP by 1-2% this year. The rouble devaluation has created a cushion of competitiveness for Russian exporters. And, with oil prices rocketing, export revenues will remain high for the foreseeable future. Almost overnight, the country now has the resources to implement a sustainable economic strategy for reviving growth in the long term. |
