Russia and the economic crisis

Russian foreign trade turnover in January-April 2009 decreased by 45.3% compared to that of the same period last year and amounted to $ 124.3 billion, says the message of the Federal Customs Service. Foreign trade turnover with foreign countries amounted to $ 106.3 billion (down 45.1%), and with the CIS countries – 18 billion (down 46.5%).

The trade balance was positive in the amount of $ 31.3 billion, which is $ 38.8 billion less than that in January-April 2008. In the trade with foreign countries the balance was equal to $ 24.7 billion (down 34 billion dollars), and with the CIS countries – 6.6 billion dollars (a decrease of 4.8 billion dollars). Export of the Russian Federation in January-April 2009 amounted to $ 77.8 billion as against that of January-April 2008 – a decrease by 47.7%, including export to foreign countries – $ 65.5 billion (down by 48, 1%), and the CIS countries – $ 12.3 billion (down by 45.4%).


“Reduction of the value of Russia’s exports in January-April 2009 was due to a fall in average prices of exported goods and because of the physical volumes of export supplies”, – said FCS. The basis of Russia’s exports in January-April 2009 to foreign countries amounted to fuel and energy goods, the share of which in the commodity composition of exports to these countries amounted to 67.4% (in January-April 2008 – 72.8%).

Imports of Russia in January-April 2009 amounted to $ 46.5 billion, which decreased by 40.9% compared with that of January-April 2008, including from foreign countries – to $ 40.8 billion (down by 39.5%), and from CIS countries – 5.7 billion dollars (a decrease of 48.9%). “Reducing the cost of Russia’s imports in January-April 2009 is due to a decline in average prices of imported goods, and the collapse of their volume”, – said FCS. In commodity composition of imports from foreign countries the share of machinery and equipment accounted for 45.5% in January-April 2009 (in January-April 2008 – 55.5%).

The main trade partners of Russia in January-April 2009 among the foreign countries were: China, trade with which amounted to 10.7 billion dollars, Germany – 10 billion dollars, Netherlands – 9.5 billion dollars, Italy – 8.5 billion dollars, Turkey – 5.7 billion dollars, United States – 4.9 billion dollars, Japan – 4.5 billion dollars, France – 4.5 billion dollars, Finland – 4.1 billion dollars, Poland – 4 billion dollars.

Meanwhile, the positive trade balance of Russia on the methodology of the balance of payments in April 2009 decreased by 1.7% over March 2009 and reached 6 billion 688 million dollars, said the report published today by the Bank of Russia. In general, for January-April of this year the surplus was 26.442 billion dollars, which is 2.4 times lower than that of the same period of last year.


At the same time, as compared to April 2008, the trade surplus decreased 2.2 times (from 14 billion 835 million dollars).

Exports of goods from Russia in April 2009 compared with that of March 2009 increased by 0.5% and amounted to 21 billion 279 million dollars. Imports to Russia in April 2009 increased by 1.55% – up to 14 billion 591 million dollars. Export from the Russian Federation decreased by 47.1%, import – by 42.6% Compared with those of April 2008.

Thus, foreign trade turnover on the methodology of the balance of payments in April 2009 amounted to 35 billion 870 dollars, which is 0.9% higher than that in March 2009.

Russian GDP may decline to 6-7% and inflation may become below 10% while maintaining the trend of stabilization in the economy in 2009, predicts Oleg Vyugin, the president of the board of directors of MDM-Bank, ex-head of Federal Financial Markets Service. “If Russia’s economy is going towards stabilization, we can get a reduction of GDP at the level of 6-7% the following years, taking into account the effect of the fourth quarter of 2008. Inflation under such scenario may be less than 10%”, – said Vyugin.

The new work of the RF Ministry of Economic Development forecasts a fall in GDP in Russia by 6-8% this year, a number of officials and experts do not rule out a deeper downturn in the economy. The official forecast for inflation this year is 13%. “I would describe the present situation in the Russian economy as stabilizing. I think later (in the short term) we will flounder somewhere at the current level, which is now reached”, – said Vyugin.

In his view, the projections for the longer term can be built no earlier than autumn of this year. “This is due to the fact that consumers’ and producers’ views on the trends of development of economy and the strategy of their behavior results from the signals that they receive from the economy during a few months. I think that by the fall of this year final opinion on the further development of the Russian Federation can be formed on the model of the letter L, not W, as some think now, “- said Vyugin.

Russia and the economic crisis