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Medvedev says economic situation in Russia is stabilizing

April 21, 2015, 14:24 UTC+3 MOSCOW

"Everything that is happening is far from a worst-case scenario," PM Medvedev said, presenting the annual report to State Duma

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Russian Prime Minister Dmitry Medvedev at the State Duma

Russian Prime Minister Dmitry Medvedev at the State Duma

© Dmitriy Astakhov/Russian government press service/TASS

MOSCOW, April 21. /TASS/. Russian Prime Minister Dmitry Medvedev believes that the current crisis is not the worst possible, especially since the situation managed to stabilize, he said Tuesday.

"Everything that is happening is far from a worst-case scenario," PM Medvedev said, presenting the annual report to State Duma. As examples, Medvedev talked about the situation with prices, unemployment, the state of the banking system and the production sector, which, according to him "could be much worse and much more difficult." 

He said that last year the government began to take the necessary steps, given the past experience of the 2008 crisis. "Many of the measures then entered the Priority Action Plan for the sustainable development of economy and social sphere in 2015 and they already provide at least a partial response," - said Medvedev.

According to Medvedev, "the foreign exchange market calmed down and the economy is gradually adapting to the floating exchange rate of the ruble." "We still maintain a relatively low level of public debt. The federal budget deficit, although slightly increased, according to the results of this year will remain at an economically safe level. Unemployment remains within reasonable parameters, it is low against corresponding conditions in other countries," Medvedev said. "As inflation slows down the Russian Central Bank key rate also reduces, the Russian Central Bank key rate is also lowered," he said. According to him, "the economic situation as a whole is stabilizing."

"There should not be any illusions. Today we are dealing not only with short-term crises. Yes, we were able to overcome most of them. But if the external pressure increases, oil prices remain at extremely low levels for a long time, we will have to develop in a different economic reality, which will challenge our strength," the Prime Minister said. 

Energy sector 

 Russian Prime Minister Dmitry Medvedev said on Tuesday he was content with the performance of the domestic energy sector in general and the oil and gas industry and nuclear power engineering in particular.

"The operation of the nuclear power sector is absolutely stable and, moreover, it is characterized by the existence of uniform technological processes and technologies both for energy purposes and the production of armaments," the premier said.

Medvedev said Russia’s oil output had stabilized at the level of about 527 million tons a year, showing a small increase from the previous year.

"This level is sufficient for ensuring the country’s own needs and export deliveries," he said.

The country’s energy system operated "without failures" in 2014, Medvedev said.

"Last year, a record volume of modern generating capacities for our country was commissioned. A total of 30 power units were put into operation at thermal power plants and the construction of the Boguchanskaya hydropower plant [in Siberia] was completed," he said.

"The Sayano-Shushenskaya hydropower plant [in south Siberia] was fully restored after the 2009 accident," the Russian premier said.

Russia attracted over 50 billion rubles (about $1 billion) in private investment for the development of renewable energy sources and work continues for improving consumers’ access to the electric power infrastructure, Medvedev said.

Imports substitution program

The current restrictions caused by anti-Russian sanctions and the ruble’s weakening are "good opportunities" for imports substitution, Medvedev said.

At the same time, this process "needs time and money" and the government is aware of it, he added.

By now, import substitution programs have been prepared for all sectors of the economy and their implementation envisages more than 2,500 projects, he said.

Medvedev added that import substitution does not imply the complete economic isolation of the country.

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