"In the near future Russia will overcome the crisis"

By Vestnik Kavkaza

August 17, economic experts recalled another "Black August", when 15 years ago, a technical default was declared on the main types of government debt. It is believed that the consequences of default had a positive impact on the development of the Russian economy - an era of easy money was over. Nevertheless, many still remember 1998 with a shudder, fearing repetition of the events.


Commenting on the reasons for the default, scientific director of HSE, the ex-Minister of Economic Affairs, Internal and External Investments Yevgeny Yasin said: "Every one of those people who made certain decisions is not directly to blame, from my point of view. All in all, it was a picture that was associated with the major reforms of 1991-1992, and then monetary and fiscal policy was conducted with enormous difficulties in these years. Then the tight fiscal policy was necessary in order to achieve victory over inflation. On the other hand, everything was done by businesses in the process of reorganization, reconstruction, adaptation to new conditions, without significant investment, because there was no money. "


The second point, which was crucial, according to Yassin, is that at the same time an international crisis occurred: "We knew immediately after the presidential election of 1996, when a lot of money had been spent, that the situation in the financial sector was extremely unfavorable. It was frustrating, because before this, in 1995, after the colossal works the budget was almost balanced. In 1997, we made the first normal borrowing in global financial markets - it was the infamous government treasury bills that met all the requirements for international security. Only when they began trading, the yield was almost nothing... Their yields began to rise rapidly. We had no money in the budget to pay the military, teachers, doctors. There was a growing glow all the time, and it was not clear what to do. In addition, there was a very sharp political crisis between the government and the president and, on the other hand, the parliament, the State Duma, where at that time the majority belonged to the Communist Party together with the Agrarian Party. So, from my point of view, the crisis was inevitable. But almost immediately after the crisis, already in the last months of 1998, a number of industries began to rise, and there was a growth in production, which we had not seen in Russia since 1990. "

Meanwhile, according to sociologists, today almost two-thirds of Russian citizens expect a possible devaluation of the ruble. Only a fifth of them are sure that the ruble exchange rate will be stable. Another former economy minister, deputy Director General of RUSNANO Yakov Urinson, said in an interview to VK: “Devaluation will not occur. Devaluation is when the decision is made to change the rate, to lower or raise the ruble. It will not. Accordingly, the ruble will fluctuate somewhere between 32-33 per dollar. Now, given the world situation, I think it will be 33, then it will fall again to 32. Until the end of the year it will be about 32-33. A devaluation is when a decision is made. What happens to the ruble today is influenced by supply and demand. Oil prices are changing, and the prices of money are also changing naturally. The interest rate is the price of money."

- In your opinion, is it possible Russia will enter a state of crisis?

- I believe that in the near future a way out of the crisis is waiting for Russia. It will be slow, heavy, complex, but it will still be a way out of the crisis. 2013 will be even more difficult, we are unlikely to enjoy any significant growth this year. But in 2014-2015, thanks to the international environment, growth is possible. The global economy is recovering, and there will be more or less normal development. Russia, too, has the opportunity to improve its economic situation. This applies to all regions, including the North Caucasus. The world economy evolved quite well in the early 2000s. This increased demand for our resources, including oil, gas, wood, metal. Therefore, Russia has developed with quite a high growth rate – 5 to 7% per year. Now in the world there has been a way out of the crisis, the U.S. economy is already out of the crisis, European countries are also on this way, even the Japanese are out of the crisis. This gives hope that there will be growing demand for our resources, and a favorable external environment will be created for Russia. The main thing is to use it properly.
 

- Is it a problem that we are so attached to the price of oil still?

- The problem is not the price of oil or the fact that we are tied to it. I'm always surprised when people say "resource curse" and so on. The fact that we have oil is to our benefit. We must make good use of the revenues that we get from oil, not investing them in the construction of all sorts of useless structures, but in the normal development of industry and agriculture. This can be done if the extra oil money is not invested at the behest of the highest person in the country in the construction of another stadium or another road, but wherever profitable. If so, the oil money will only provide greater economic growth. This is good. The extra money that is coming at us from the ceiling should be used effectively. You can use it effectively only by obeying the laws of the market, not commands from above on holding, say, the Winter Olympics in a southern city or something like that.

Now it seems to me that a fall in the price of oil is not to be expected - the world is coming out of recession and beginning to rise. If it rises, the demand for raw materials increases.