About: Russia—Quick Facts

GDP Growth

Over the past five years, Russia has been an economic success story largely unrecognized in the U.S. with over GDP growth rates of of 4.9% in 2001, 4.0% in 2002, 7.3% in 2003, 7.2% 2004, 6.4% in 2005, 7.4% in 2006, and 8.1% in 2007, and 5.6% in 2008 years.

Balance of Trade

Trade surpluses of $67.0 billion in 2000, $54.7 billion in 2001, $55.0 billion in 2002, $68.9 billion in 2003, $94.4 billion in 2004, $118.26 billion in 2005, $139.2 billion in 2006 and $130.9 billion in 2007. In 2008 trade surpluses reached $179,8 billion.

Real Disposable Income

Rose 9.1% in 2000, 7.2% in 2001 and 8.8% in 2002, 14.9% in 2003, 7.8% in 2004, 8.9% in 2005, 10.0% in 2006 and 10.4% in 2007.

Foreign Investments

FDI remained around 1% of GDP between 1997 and 2002 and reached 5% in 2002. Capital inflows in 2003 increased up to $9.9 billion (50% increase from 2002)–6.7% of GDP; in 2004 rose up to $10.8 billion (36% from 2003)–7.2% of GDP; in 2005–$13.1 billion (32% from 2004)–7.5% of GDP; in 2006–$13.7 billion (4% from 2005)–6.1% of GDP; in 2007–$27.8 billion (202% from 2006)–9.6% of GDP, in 2008 - $27,02 billion. In Q1 2009 the FDI comprised $12,03 billion.

Independent Analytical Evaluations

• Moody's Ratings 2005: “Russia's liquidity and debt ratios have improved dramatically in a relatively short time period. The outlook for the rating is now “stable”.
• Moody's Issues Annual Report on Russia 2006: "Russia's investment-grade ratings reflect more than six years of strong current account and budget surpluses, rapidly falling government debt levels, and massive increases in official foreign currency reserves and the oil stabilization fund."
• Russia is ranked fifth among Europe's most attractive countries for foreign direct investment (2007, Ernst&Young CIS)
• Standard&Poor’s Credit Rating , 2008 is "BBB".
• Moody's Ratings , 2008: "Considerable foreign currency reserves and government oil savings place Russia in a position to withstand even rather severe external shocks. Rating Outlook The government's foreign and local currency ratings and Russia's country ceiling for foreign currency bank deposits are on review for possible upgrade."
• In AT Kearney's 2009 Global Retail Development Index, Russia is on the second place in a study of retail investment attractiveness among 30 emerging markets.
• Fitch Ratings, 2010: Russia’s credit rating - stable; long-term foreign and local currency issuer default rating - BBB

Government Support

• November 2004: Concept for the Information Technology Advancement in the Russian Federation till the Year 2010 approved
• December 2004: President Putin visits Bangalore, India
• January 2005: President Putin announces
  IT technology park initiative
• February 16, 2006: State Council Presidium Meeting on Information and Communication Technology in the Russian Federation,
  Nizhniy Novgorod
• March 10, 2006: Technology park projects started: parks to be built in St. Petersburg, Tatarstan, Moscow, Tiumen, N. Novgorod, Novosibirsk regions, $3.6B total,
  20% state investments
• 2006: IT investment fund announced: $100M, 75% state investments
• 2006: Approved: VAT refund, special economic zones law; software exports simplified
• 2007: the Russian IT market volume reached $22.2 billion USD (IDC), with government being one of the main consumers of IT services
• 2009: favorable insurance terms for small companies in ICT field prolonged up to 2011.
• 2010: A high-tech research and production hub, similar to the Silicon Valley in California, is to be built in Skolkovo near Moscow. The residents of the technological park will enjoy tax holidays during a period of ten years and will be exempt from the payment of profit tax, VAT, property and land taxes.

Labor Pool

• Russia has one of the highest adult literacy
  rates in the world (98.7%)
• As a result of great emphasis on science and technology in education, Russian mathematical and scientific research is generally of a high order. Russia is widely known for its world-class R&D traditions, supported by the large number of scientists, mathematicians, engineers, and other IT-related specialists available in the labor pool.
• The number of university graduates in IT-related fields amounted to over 244,000 people in 2005-2006 academic year
• Low-cost labor resources with engineering and software talent
• Russian university teams annually take part in ACM International Collegiate Programming Contest and win first places. In 2010:Champion of Europe, 1 gold medal,. 5 out of total 13 medals. In 2009: world champion, 3 of 4 gold medals, 4 of 13 total medals. In 2008: world champion, 3 of 4 gold medals, 7 of 12 total medals. In 2000-2007: 4 times world champion, multiple other medals