The Fitch International Agency worsened its forecast for the Russian economy for 2016 from a 0.5% decrease in growth to a 1% decrease, according to the results of 2015, falling oil prices, and the influence of further cuts. Interfax reported that, according to the January data of Rosstat, in 2015 the Russian economy decreased by 3.7%. Investments decreased by 8.4%. Industrial production decreased by 3.4%. The real income of the population fell by 4%, real wages by 9.5%. Due to the impoverishment of the population, consumption decreased seriously as well: retail turnover decreased by 10%; in December 2015, it had decreased by 15% in comparison with the level of December 2014.
Sergei Kalashnikov, First Deputy Chairman of the Federation Council Committee on Economic Policy, says that the passage through economic problems by any country is always associated with its national characteristics. He thinks that all Russia’s troubles started in 1986, after the law on cooperatives was adopted: “The law was super progressive, super democratic, except for one ‘but’. It created a mechanism for pumping huge budget money into private hands. And since then we have public money and private money that are mixed.”
The senator suggests using China’s experience: “In 1989 they created a two-storey economy, where the budget money is separated from business money. The budget helps to develop business, but they do not mix this money, thereby determining the effectiveness of various costs. I do not want to say that we need to copy the model of China, because the Chinese themselves, I have repeatedly talked to them on this subject, they say, that they don't have any -ism, they have their Chinese economy. And we need a Russian model of the economy.”
Kalashnikov says that the model means that “we have a clear idea of what we aspire to, in which graph, and most importantly, by what means we achieve this. Any funds that we are now able to introduce, if there is no clear definition of objectives, then what we will get in some short, medium, and far period of time, it's not going to work.”
The senator gives an example of small business: “Since 1989, we were talking about supporting small business, it is important, necessary. Not a single meeting of the State Duma is held without another innovation aimed at enriching small businesses to create more favorable conditions, but the necessary laws are not passed. However, small businesses are in the same condition in which they are located, and there are no prospects for their development to date, no. Whatever has been invented. I, for instance, believe that small businesses need only one law – 10 years without any laws to support small businesses, leave them alone. When there are some innovations every month, it does not allow small businesses to predict anything in the short term, it is a persistent fever. Do not touch small business, it will adapt, if it knows for sure that nothing will change.”
