-

Russian Regions in January-May in 2018

Natalia Zubarevich – Main Research fellow of the Demography and Migration Research Department, Institute of Social Analysis and Forecasting, Russian Presidential Academy of National Economy and Public Administration, Doctor of Geographic Sciences, Professor. E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

In first five months of 2018, socio-economic dynamic improved; however, there was no sustainable growth in most regions. Russian territories’ budgets have also improved: in the course of presidential elections, regional transfers have substantially grown, and so have social expenditures.

Key words: RF regions, socio-economic situation of regions, regional budgets.

Level of Adaptability of Russian Industry in Q2 2018

Sergey Tsukhlo – Head of Business Surveys Department of the Gaidar Institute, Candidate of Economic Sciences. E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

In Q2 2018, the Russian industrial sector managed to recover to a normal state of operation from the failed start early this year. The percentage of enterprises assessing their state as “normal standing” neared an all-time high by mid-2018 (77% compared to 78% in H2 2017).

Key words: industry, industry adaptation index, demand, expected demand, stocks of finished products, output and employment.

Regional Diversity of Fertility in Russia in 2017 and Its Possible Correlates

Konstantin Kazenin – Director of Center for Regional Studies and Urbanistic, Institute for Applied Economic Studies, Russian Presidential Academy of National Economy and Public Administration, Candidate of Faculty Sciences. Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Aleksey Raksha – Advisor at the Section for Demographic Statistics of the Department for Statistics of Population and Medical Statistic, Federal Agency for State Statistics. Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

In 2017, for the first time after the start of the maternity capital program in Russia, fertility decreased in all federal districts and in most of regions of the country. Although the fertility of first-born children was decreasing during several previous years as well, the decrease fertility of second and subsequent children became the common trend for Russian regions only in 2017.

The correlation of regional fertility rates with some economic parameters of regions (employment level; proportion of population with incomes lower than the subsistence minimum; housing conditions) shows that in 2017 regional fertility was related to economic conditions which increase the “demand” of the maternity capital in the region. This relation, observed during the all-country increase of fertility after the start of the maternity capital program, has been preserved when fertility started lowering.

Key words: fertility, regions of Russia, Total Fertility Rate, pronatalism, employment, housing conditions.

Industrial Production Dynamics in H1 2018: Rosstat Revises Its Statistics

Andrey Kaukin – Head of Department for System Analysis of Sectoral Markets, Institute of Industry and Markets Infrastructures, Russian Presidential Academy of National Economy and Public Administration; Head of Sectoral Markets and Infrastructure Department of the Gaidar Institute, Candidate of Economic Sciences. Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Eugenia Miller – Research fellow of the Industrial Markets and Infrastructure Studies Department, Institute for Applied Economic Studies, Russian Presidential Academy of National Economy and Public Administration. Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Rosstat announced late in Q2 2018 that it would need to revise its statistics on industrial production dynamics. As a result, growth rates, which were close to zero in the first quarter, turned positive for both the manufacturing and extraction sectors at the half year’s end. A lack of transparency in the data revision methodology raises reasonable questions about the quality of Russian statistics.

Key words: industry, economic sectors, mining industry and manufacturing, Rosstat.

Migration Processes: Russia’s Population May Shrink

Nikita Mkrtchyan – Leading Research fellow of the Demography and Migration Research Department, Institute of Social Analysis and Forecasting, Russian Presidential Academy of National Economy and Public Administration, Candidate of Geographic Sciences. Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Yulia Florinskaya – Leading Research fellow of the Demography and Migration Research Department, Institute of Social Analysis and Forecasting, Russian Presidential Academy of National Economy and Public Administration, Candidate of Geographic Sciences. Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

As migration growth in Russia’s population keeps falling, Russia may face a renewed reduction of its population as early as this year amid the natural decline in the population. This situation is driven by a decreased migration growth from Ukraine amid a weak recovery of the migration inflow from Central Asian countries. Migrants’ payments to Russian regions’ budgets keep growing.

Key words: migration, intellectual migration, migration of persons with higher education, domestic migration of persons with higher education.

Part of the People’s Republic of China in Regional Trade Agreements

Nadezhda Volovik – Head of Foreign Trade Department of the Gaidar Institute; Senior Research fellow of the Macroeconomic Simulation Department, Institute for Applied Economic Studies, Russian Presidential Academy of National Economy and Public Administration. Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Changing geo-economic structure of the world makes the Russian Federation and the people’s Republic of China to seek new ways of embedding in the emerging economic order, which led to a strengthening of relations between the two countries and to attempt to coordinate their integration projects. EAEC member countries have a great potential and broad prospects for economic and trade cooperation with China.

Meanwhile, entering into a free trade zone with such an economic giant like China, is a major step and before you go on it, it should be repeatedly calculate its strategic implications. The article provides a brief description of the free trade agreements concluded with the participation of the people’s Republic of China.

Key words: People’s Republic of China, regional trade agreements, free trade agreements, free trade zone.

Assessment of Performance and Efficiency of Monitoring and Supervision Activity from the Business Point of View

Elena Dobrolubova – Main Research fellow of the Governance Technology Center, Institute for Applied Economic Studies, Russian Presidential Academy of National Economy and Public Administration, Candidate of Economic Sciences. E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Vladimir Juzhakov – Director of Governance Technology Center, Institute for Applied Economic Studies, Russian Presidential Academy of National Economy and Public Administration, Doctor of Philosophical Sciences. E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Andrey Pokida – Director of Research Centre for Socio-Political Monitoring, Institute of Social Sciences, Russian Presidential Academy of National Economy and Public Administration, Candidate of Sociological Sciences. E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Natalia Zybunovskaya – Research fellow of the Research Centre for Socio-Political Monitoring, Institute of Social Sciences, Russian Presidential Academy of National Economy and Public Administration. E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

The article provides the findings of the representative sociological survey of businesses regarding the assessment of performance and efficiency of monitoring and supervision activity conducted in 2016 at the onset of the state supervision reform. The authors indicate that in the majority of cases the activity of regulatory bodies does not result in the safety and quality increase of products, safety of production; at the same time, regulatory activity is associated with significant costs for both economic entities and the state.

Research findings confirm the need for a serious reform of regulatory activity with the aim of focusing the regulatory activity on risks prevention, minimizing consequences in case when the damage was done and on securing compensation for the damage done.

Key words: state regulation, regulatory activity, economic entities, sociological survey

Russia’s Foreign Trade in January-May 2018

Alexander Knobel – Head of Foreign Trade Department, Center for Real Sector of the Gaidar Institute; Director of the Center for Foreign Trade Department, Institute for Applied Economic Studies, Russian Presidential Academy of National Economy and Public Administration, Candidate of Economic Sciences. Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Alexander Firanchuk – Senior Research fellow of the Center for Foreign Trade Department, Institute for Applied Economic Studies, Russian Presidential Academy of National Economy and Public Administration. Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

During the first five months of 2018 Russian fuel exports grew by 28%. Exports of other goods moved up by 26%, surpassing the pre-crisis level of 2013. Imports went up by 16%, for the first time in five years its dynamics did not correspond to the dynamics of the exchange rate: imported goods have significantly increased in value terms while the real effective ruble-dollar exchange rate has barely gained any new positions.

Key words: export, import, exchange rate, import duties.

Venture Financing and Crowdfunding as Tools to Support Economic Security of Small Innovative Business Entities

Andrey Minakov – Professor, Chair of Economics and Accounting, Moscow University of the Ministry of Internal Affairs, Doctor of Economic Sciences. E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

The article analyzes the approaches to improving the financing of the activities of small innovative enterprises and enhancing their economic security. The relevance and importance of the development of small innovative enterprises in the market economy of Russia is determined. Venture financing and crowdfunding are considered as tools to support economic security of small innovative business entities. Based on the analysis of various literature sources, the main advantages of venture financing are systematized in comparison with bank lending.

Key words: economic security, small innovative enterprises, venture financing, crowdfunding.

Russia’s Monetary Policy in June 2018: Higher Inflation Risks to Increase

Alexandra Bozhechkova – Head of Monetary Policy Department of the Gaidar Institute; Senior Research fellow of the Center for the Study of Central Banks, Institute for Applied Economic Studies, Russian Presidential Academy of National Economy and Public Administration, Candidate of Economic Sciences. Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Pavel Trunin – Head of Center for Macroeconomics and Finance of the Gaidar Institute; Leading Research fellow of the Center for the Study of Central Banks, Institute for Applied Economic Studies, Russian Presidential Academy of National Economy and Public Administration, Candidate of Economic Sciences. Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

The Bank of Russia decided in June to keep the key interest rate unchanged because of worsening geopolitical uncertainty, capital outflows from developing countries as a consequence of tighter US Fed’s monetary policy, plans to raise the VAT rate, as well as prices adjustment to a weaker rouble. In the today’s context, Russia’s central bank may postpone its monetary policy easing until next year.

Key words: inflation, monetary policy, key rate, outflow of capital, Bank of Russia.

Household Final Consumption Expenditure on the Way to the Consumer Lending Model

Michael Khromov – Head of Department for Financial Studies of the Gaidar Institute; Senior Research fellow of the Center of Structural Research, Institute for Applied Economic Studies, Russian Presidential Academy of National Economy and Public Administration. Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

For the first five months of 2018, household savings moved up merely by 1.3% which is the bottom low for the last several years. Meanwhile, retail lending has been demonstrating an upward trend. The public borrows significantly more than deposits.

Key words: banking sector, households, loans, loan behavior pattern.

Russia’s Balance of Payments in Q2 2018

Alexandra Bozhechkova – Head of Monetary Policy Department of the Gaidar Institute; Senior Research fellow of the Center for the Study of Central Banks, Institute for Applied Economic Studies, Russian Presidential Academy of National Economy and Public Administration, Candidate of Economic Sciences. Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Alexander Knobel – Head of Foreign Trade Department, Center for Real Sector of the Gaidar Institute; Director of the Center for Foreign Trade Department, Institute for Applied Economic Studies, Russian Presidential Academy of National Economy and Public Administration, Candidate of Economic Sciences. Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Anastasia Lavrischeva – Postgraduate Student, Chair of Microeconomics Economics Faculty, Russian Presidential Academy of National Economy and Public Administration. E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Pavel Trunin – Head of Center for Macroeconomics and Finance of the Gaidar Institute; Leading Research fellow of the Center for the Study of Central Banks, Institute for Applied Economic Studies, Russian Presidential Academy of National Economy and Public Administration, Candidate of Economic Sciences. Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

The Russian current account balance rose in Q2 2018 year-on-year on the back of, among other things, rising positive balance of trade. Non-residents reduced their holdings of OFZ bonds over downbeat geopolitical expectations. Some extra growth in the current account balance can be expected in the second half this year, and the Russian rouble may appreciate late in the year, barring risks such as geopolitical exacerbation or plummeting energy prices.

Key words: balance of payments, current account, trade surplus, capital outflow, capital inflow and exchange rate, Bank of Russia.

Survey of Current Business (May-August 2018)

Sergey Aukutsionek – Head of Center for Transition Economy Studies, Primakov National Research Institute of World Economy and International Relations, Russian Academy of Sciences, Candidate of Economic Sciences. E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Andrey Yegorov – Research fellow of the Center for Transition Economy Studies, Primakov National Research Institute of World Economy and International Relations, Russian Academy of Sciences, Candidate of Economic Sciences. E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Inessa Bachirova – Senior Research fellow of the Center for Transition Economy Studies, Primakov National Research Institute of World Economy and International Relations, Russian Academy of Sciences. E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Stanislav Belyakov – Research fellow of the Center for Transition Economy Studies, Primakov National Research Institute of World Economy and International Relations, Russian Academy of Sciences. E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

In May 2018 the most significant changes were recorded in the wage rates: diffusion index of wages increased by 18 points, and its three-month expectations’ index rose by 6 points. Diffusion index of input prices, which has been growing since the beginning of the year, added another 7 points and exceeded the level of 80 points for the first time in 2.5 years. Its three-month expectation as well increased (+11 points). Diffusion index of expected in three months output also augmented significantly (+14 points).

Key words: industry, industrial enterprises, price level, wages, employment, output, investment, indebtedness to banks, order-book level, stocks of finished products, capacity utilization rate, risk of bankruptcy, economic policy, crisis duration.