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The OECD, for example, forecast GDP growth of 2% for 1996 and did not preclude the possibility of growth of 10%. Cf.OECD Economic Surveys, The Russian Federation 1995, Paris 1995, p. 23.
Unless otherwise stated, all the statistical data are derived from Goskomstat.
Thebusiness sector encompasses industrial, agricultural, construction and transport firms.
According to the figures available, the 80 largest firms account for 73% of the outstanding payments.
For tax arrears to government tiers below central government, a penalty of 0.3% per day is imposed; this represents an annual interest rate of 110%. Previously the rate had been 0.7%. Although the current real interest rate is extremely high, the regulation still permits firms to gain a financial room for manoeuvre in the face of the restrictive credit policy pursued by the banks vis à vis firms. Given the length of time required to enforce the taxation legislation and the fact that, in the past, tax amnesties have been granted in similar situations, the extremely high formal rate of penalty interest on tax arrears probably does not constitute an incentive to pay.
According to preliminary figures for money supply trends in July and August, the growth of the money supply declined once more. This was primarily due to a decline in currency reserves of almost 20% in July and August, leading to an expansion of the monetary base of less than 1%. Calculated on a quarterly basis the volume of M2 rose by just 5%.
In the first six months of 1996 alone, claims on the government as a proportion of total assets of the commercial banks—that had amounted to 5% as recently as the end of 1994-rose from 18 to 22% (cf. International Monetary Fund,International Financial Statistics, October 1996, Washington D.C. At the same time, their assets against firms declined from 56% to 53%.
During the first seven months of 1996 these auction credits amounted to around 20% of the new loans granted by the central bank. Besides this, short term money has been provided since October via open market operations involving government bonds with a repurchasing agreement; cf.OMRI Economic Digest, vol. 2, no. 43, October 1996.
One possible explanation for this is that foreign loans were passed on, via the central bank, to government. On acceptance of such loans the central bank's claims on the government would rise and its foreign assets decline. However, only a part of the increase in claims on government can be explained in this way.
The minimum reserve ratios on giro and time-deposit accounts with a duration of up to 30 days were increased from 18 to 20%, for deposits with a duration of between 31 and 90 days from 14 to 16%, for deposits with a duration of more than 90 days from 10 to 12%, and for foreign exchange deposits from 1.25 to 2.5%.
These debts include both those to the budget and the extra-budgetary funds and to suppliers. Over the year the relative shares of these two types of debt remained more or less unchanged at about 50% each.
Central Bank of the Russian Federation,Bulletin of Banking Statistics, no. 8(39), Moscow 1996.
Cf. Central Bank of the Russian Federation,Bulletin of Banking Statistics, no. 1(32) and no. 8(39), Moscow 1996. At the start of 1996 significant revisions were made to the statistics on the extent of nonperforming loans on the banks' books. Accordingly non-performing loans fell as a proportion of total bank loans from 33% to 8% at the end of 1995. Presumably this revision reflects the writing-off of irrecoverable debts.
A further 9 banks were restructured or liquidated during the first seven months of 1996.
Stefanie Seeberg and Adalbert Winkler, Lending in a New Regulatory Environment-The Monetary Situation in Russia in the Summer of 1996,International Project Consult, Frankfurt 1996.
The new minimum capital for commercial banks with a general licence is ECU 5.0 million; the risk-weighted equity capital share was increased from 4 to 8%, a number of regulations on large-scale credits and liquidity coefficients were adjusted and weighting criteria for risk assets introduced. Cf. Stefanie Seeberg and Adalbert Winkler, op.cit.
The central bank intends to increase the degree of control over a group of larger banks regarding adherence to the new standards. These banks are to be forced to publish their financial data in more stringent fashion and are to be restructured by the central bank.
The obligations taken on by Russia since the dissolution of the soviet Union on 28 October 1991 do not form part of the rescheduling agreement, as so far they have been serviced punctually.
Russian Economic Trends, Monthly Update, May 1996, p. 6;Economist of 4 May 1996.
Of these loans, DM 4 billion consist of balance of payments and budgetary assistance (DM 1 billion of those funds tied to specific projects), and a further DM 1.1. billion of supplier credits secured by government-backed guarantees (Hermes and the BVS, the successor organisation to the Treuhandanstalt).
This scenario is based on the assumption that 60% of due interest payments are capitalised.
The mixed sector contains partially privatised firms, including those in which the state retains a significant share. In order to describe the weight of the public sector, the mixed and the state-owned sector are considered together in the following-and not, as in other studies, the mixed and the private sectors.
Calculated on the basis of figures from the State Committee for Property (GKI).
In practice, however, it cannot be precluded that the formation of these groups is being promoted by central organs such as ministries.
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German Institute for Economic Research, Berlin (DIW)., Institute for the World Economy at the University of Kiel (IfW). & Institute for Economic Research Halle (IWH). The economic situation in Russia: Economic policy must create incentives to invest. Economic Bulletin 34, 11–24 (1997). https://doi.org/10.1007/BF02683911
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DOI: https://doi.org/10.1007/BF02683911