#2 - JRL 7224
Russia can double GDP in a decade: IMF official
June 16, 2003
A doubling of Russia's gross domestic product, requiring average annual growth of 7.2 percent, within a decade is a realistic objective, a visiting senior IMF (International Monetery Fund) official said on Monday.
Doubling GDP within a decade, the target set by President Vladimir Putin during his state of the nation address last month, "would require growth of 7.2 percent per year, and such growth is wholly achievable in a country like Russia", IMF first deputy director Anne Krueger told the Kommersant business daily.
"Of course this would require bolder structural reforms than we have yet seen, but this too is an achievable task," Krueger said as quoted by the daily.
The official cited Japan and South Korea as examples of countries setting themselves and achieving such a target.
"Japan in the late 1950s set itself to double its income in 10 years and did so, while the Koreans in 1963 targetted a doubling of income, and over the following 10 years it increased by a factor of four," Krueger told Kommersant.
She noted that huge growth was possible in Russia simply by means of more rational use of the assets it already possesses.
"If structural reforms are carried out, Russia can achieve colossal growth simply by using more rationally what it already has," she said.
"We believe the Russian economy is developing and achieving better results than many other countries. I think there is every reason to believe this will continue, though there is much to do by way of structural reforms to strengthen the basis for growth, especially in areas outside the extraction industries."
Krueger cited the banking sector as a priority area for reform.
During her visit to Russia, the IMF official was due to attend an economic forum in Russia's second city of Saint Petersburg and meet Prime Minister Mikhail Kasyanov.
Russian Finance Minister Alexei Kudrin earlier this month described a doubling of GDP over the next decade as a realistic target subject to reforms being made in monetary policy, the administration and the natural monopolies.
Current governments estimates are for 4.6 percent growth in 2003, compared with 4.3 percent in 2002.
Provisional figures for January-April this year indicate 6.6 percent growth compared with the same period last year.
Long-term estimates by the economic development ministry predict growth of between five and six percent during the period 2004-2006, with seven percent a possibility.