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SINCE THE RUSSIAN economy began growing strongly in 2000 the question has been: can it do enough quickly enough? Blessed with the second-largest oil reserves in the world, it has relied on oil revenues to buy itself out of the worst pain of transition, but it needs to break its addiction to high oil prices if growth is to be sustainable.
A report for the World Bank in February poured cold water on Russia enthusiasts who have been saying that the growth of small and medium-size enterprises and consumer spending are already the main economic drivers. It concludes that Russia is as addicted to oil as it has ever been.
Curious fact In the preamble the World Bank wrote: "Looking at the importance of the oil and gas sectors in Russia's national accounts, a curious fact emerges. Together, these sectors account for only about 9% of GDP at basic prices. If correct, why would anyone worry about over-dependence? On the other hand, according to the same Goskomstat accounts, natural resources constitute over 80% of Russia's exports, and oil and gas export revenues alone are about 20% of GDP.