Deputy Minister of Economic Development and Trade Andrey Belousov
Photo: Dmitry Dukhanin
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Inflation: The Obvious Is Now Official
The Ministry of Economic Development and Trade yesterday sent the government its latest list of anti-inflation initiatives, compiled on the order of Prime Minister Viktor Zubkov. That list has not been made public this time, but the ministry did state that the measures do not concern customs duties, but natural monopolies and special measures to control prices for fuel, cement and food. The government and Central Bank are no longer maintaining that they expect rising prices to slow down. The 0.4-percent inflation in the first 12 days of the month, bringing the year's total to 9.7 percent, has eliminated any possible optimism.
“At the beginning of the year, we planned to lower inflation to 8 percent. Now, obviously, we will get around 11 percent, maybe a little more,” admitted director of the macroeconomic department of the Economics Ministry Andrey Klepach. In addition, the Economics Ministry and Central Bank yesterday confirmed that the 2008 plan for 6-7-percent inflation would not be met either. “Unfortunately, inflation is a worldwide phenomenon,” noted deputy chairman of the Central Bank Konstantin Korishchenko.
The influx of potentially inflation-causing foreign capital into Russia is growing. Economics Minister Elvira Nabiullina said at a forum in Helsinki yesterday that $57 billion in foreign capital came into Russia in the first nine months of the year, and another $11 billion in October. Deputy Finance Minister Sergey Shatalov said at an investment conference in Moscow at the same time that $80 billion had flowed into Russia this year. Economists also mention high inflation risks from higher inflationary expectations, growth of food and energy prices on the world market and greater budget income.
www.kommersant.com
All the Article in Russian as of Nov. 16, 2007
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