canadiancomment

Our opinions and advice to the world. Updated whenever we get around to it.

The Russian Economy

Lately I have been doing some reading on the Russian economy, there are a lot of gloomy stats out there, I'm just going to give you a few of them.

- According to a government assessment in 1995, the state received a mere 3.6% of the real value of the 500 largest companies when they were privatized.

- Annual loss to state and public corruption is estimated at 30 billion US dollars, twice the size of the current defence budget.

- In 2003 a member of the VAZ's (Russian Auto Plant) production council reported that 40% of the companies profits were lost to theft and other forms of crime.

- In 2003, as few as 20 large conglomerates controlled about 70% of Russia's GDP.

- In 2003, 20.2% of workers in the machine building and metal working sectors were employed in harmful or dangerous conditions.

- In 2001, 4372 workers were killed in the work place.

- In 2001, the government introduced a flat tax of 13%, in hopes that some of the country's wealthy would actually pay it.

- The minimum pension in mid 2003, which was received by over 4 million Russians, was equivalent to 22 dollars American.

- The actual estimated unemployment rate in 1999 was as high as 30%.

- The state's education budget in 2002-03 was only 0.6% of the GDP.

- Of the 7 million 'offically' unemployed in 2000 only 13% were receiving any help from the government.

- According to the Deputy Prosecuter-General, there were 3 million street children in 2002.

Russia's transfer to a totally new system doesn't sound like its been all that smooth, does it. My advice, if you were planning to invest any money in Russia, I'd wait, that is unless you have some connections in the government. Like the saying goes, "the most profitable business in Russia is politics."

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