Despite optimistic reports of the Russian government, experts note a decline in investment activity. Although the money available in the country, and there is much to invest – some funds are still Soviet, all imaginable and unimaginable resources already developed. So why is there is a decline in investment activity?
There is a strong feeling that the most active part of society – entrepreneurs – are tired of fighting and losing faith in their own state, and, hence, in their prospects in this state. Many business for yourself, on your business felt that the competitive advantages of the country for two decades have evaporated. Thus, domestic electricity prices are almost equal to the European soon be equal to European gas prices, and gasoline prices are already higher than in the United States and, therefore, increased transportation costs. And the increased cost of production and an indoor-I have nothing: no technologies that reduce the cost of production, lack of performance. Had one trump card – the control of its own market – and even that will depreciate after Russia’s WTO accession. Where in such circumstances to take the pep?
Pep entrepreneurs could be to give the Russian government is taking a leadership role in increasing investment activity. To increase investment in the Russian economy, mainly private, remove investment restrictions, namely, the uncertainty of the domestic economic situation, high interest rates on commercial credit and lack of own financial resources.
The uncertainty of the Russian economic situation – it is a usual thing, it’s her normal state. But to overcome the last two limitations should encourage banks, mainly public (many of them in Russia), to give private companies the available target loans to investment funds worn out old and new construction. This can be done, by the way, you can use the scheme elaborated for agricultural lending, where she gave a very tangible effect. This is the most simple and effective method of recovery in investment activity, when the domestic business is suffocating from lack of money.
If we approach the problem of lack of money globally, you should redirect the main cash flows from the state – to private entrepreneurs and the resource industries of the economy – to the manufacturing industry. Redirection of cash flows from the state to private business carried out by the tax cuts, the liberated funds private business itself dispose with the best performance. Redirection of funds from primary industries to processing even more important for our country because of the recent increased specific share of investments in pipeline transportation and mining.
As a result, Russia’s resource-based economy grows and reproduces faster than other industries due to the withdrawal of their investment, in fact, prevents them from oxygen. It is indisputable that the money goes to where the more income, and the highest profit in Russia gives extraction of resources and transportation, as well as servicing the mining and transport sectors.
Therefore, it is necessary through tax cuts increase the rate of profitability in power engineering, in the manufacture of medicines, medicines, household appliances and machine tools, and in the extractive industries, on the contrary, decreased. As a result, it is possible and can impose a budget without a deficit. Of course, such a program should be considered carefully, so as not to harm the natural resource economy, as such a program should have a specific time, such as ten years, so that manufacturers do not think that will subsidize them forever, and reinvest part of their profits to increase their own efficiency. Under these conditions, we can expect an increase in private investment in the Russian economy for the foreseeable future, and reducing dependence of the Russian economy on oil prices.