Russian industrial output steadily growing — The fastest growing branches
Russian Federal Statistics Service has recently released statistics regarding Russian industry in the first quarter. According to this data, in April Russia's industrial output is up 2.3% year-on-year.
Economic experts see the jump in industrial output as a positive sign, with the April numbers expanding on a 0.8% growth rate for March, and reversing a negative trend at the start of the year. After growing 2.3% year-on-year in January, output actually fell by 2.7% in February, owing partly to the loss of two calendar work days compared to the same period in February 2016.
Overall, between January-April 2017, industrial production grew by a modest 0.7%. Still, the figures were above economists' pessimistic estimates, and are seen as a possible indicator of positive growth rates in the rest of the economy.
However all experts agree, that Russia’s continued dependence on the extraction and sale of raw materials is detrimental to the economy. For serious GDP growth to take place, regardless of global market conditions, the Russian Central Bank will need to reduce the cost of borrowing for businesses.
Russia's GDP grew an anemic 0.3% in 2016, stabilizing after a contraction of 3.8% the year before. For 2017, the Central Bank and the Ministry of Economic Development expect growth to be between 1.5-2%.
One strong driver of positive economic growth in 2016 was the military industry and sectors associated with it. In 2016, the electronics industry saw impressive growth of 32%, while production of specialized chemicals grew by 22.5%. Shipbuilding was up by over 16%, the space industry by 7.5%, and the aircraft industry by 6%.
Healthy growth has also been recorded in the pharmaceuticals industry and in agriculture, as producers strive to substitute Western imports amid the sanctions and countersanctions war between Western countries and Russia over the Ukraine crisis.