Originally created 06/16/04

Russia aims to become less reliant on oil exports for growth

ST. PETERSBURG, Russia -- Russia wants to become less reliant on the export of its natural resources as part of the government's bid to double the gross domestic product by 2010, Prime Minister Mikhail Fradkov said Tuesday.

"We see how the potential for growth, conditioned by the raw materials factor, is gradually exhausting its resources," Fradkov said at the opening of the 8th St. Petersburg Economic Forum.

Russia's economy has been growing strongly, with GDP rising 7.3 percent last year.

But the surging growth is based on "high prices for raw materials," warned Andrei Sharonov, the deputy head of the Russian Economic Development and Trade Ministry.

Critics have warned repeatedly that the economy is overly dependent on high world prices for oil, which is Russia's primary export commodity, and that the government has failed to carry out the changes necessary to ensure that other sectors of the economy develop.

Analysts have also warned that Russia hasn't done enough to prospect for new oil deposits or to develop transport systems to ensure that it remains a leading exporter in years to come.

Fradkov said that the government is looking for "new sources for economic growth."

He said plans to diversify the economy call for "strengthening the competitiveness of Russian companies on the domestic and foreign markets, improving the business climate through stimulation of investment, and introducing new technologies".


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