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FEATURE-Russian statistics lag behind fast economic changes
By Andrius Vilkancas

MOSCOW, Feb 12 (Reuters) - The days when Russian official statistics painted a picture of a communist utopia when in reality the economy was coming apart at the seams are long gone.

Today economists fear they may still be getting a unrealistic picture of what is really happening in the country's economy -- but for very different reasons.

Russia's rough and tumble capitalist economy is evolving so fast that official number-crunchers simply cannot keep up with every twist and turn as new businesses take root and old Soviet-era enterprises go to the wall.

"Looking at the (official) statistics alone, without thinking about the anecdotes, without knowing the stories and without trying to relate those two, gets you into trouble," said Al Breach, a chief economist at Brunswick UBS Warburg who has followed the Russian economy for more than six years.

Private economists say the state statistics agency Goskomstat is providing reliable figures but focusing on the decaying part of the economy and underestimating the strength of new service businesses that are taking root.

Economists said that when they compare Goskomstat's data with figures provided by ministries or the central bank they often find they are contradictory.

They try to fill in the gaps by carrying out surveys of their own or drawing on evidence from market research companies before drawing up their own scenarios for Russia's economic development.

"But looking just to anecdotes can also get you into trouble," said Breach.

Roland Nash, a chief economist at Renaissance Capital said official statistics have been improving over the past few years but are not keeping pace with economic change.

"They give you a general idea of direction but they do not paint an accurate picture," Nash said.


He said despite efforts to improve methods and adopt western standards, Goskomstat was paying too much attention to Russia's rustbelt -- comprised of former state-owned companies -- and not doing enough to track services and new businesses.

"They are looking very much at how much stuff has been produced by the industrial sector rather than trying to get an idea of what exactly is going on in the economy," Nash said.

Economists said an example of the gap between official data and fast changing economic realities was provided by high consumer spending by many Russians.

"A very good indication is (furniture retailer) IKEA where an average customer in its Moscow shop spends as much as an average customer in Stockholm," said Peter Westin, a senior economist at Aton brokerage.

Economists attribute the discrepancies to Russia's complex tax system. Many individuals and small companies prefer not to register their businesses and keep well outside the official economy, thereby eluding state statistics.

"They do have an estimate of the shadow economy in the statistics but the methodology behind it is opaque and the chances are very high that they are underestimating its dynamics," Nash said.

Economists said the key to getting more reliable data was for Russia gradually to draw shadow economic activity into the official economy by scrapping unnecessary business restrictions and curbing a Byzantine bureaucracy.

"The major thing now is not to make improvements in the statistics but to improve the business climate that would allow more of the data to be captured," Westin said.

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