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In July the prediction that the first celebrated case, initiated within the frameworks of fight with the corruption declared by D. Medvedev, may not come to a successful end. The head of the Supreme Arbitrary Court, A. Ivanov, who is close to D. Medvedev, did not achieved to suspend authorities of the chairwoman of the Federal arbitrary court, L. Maikova (she was accused of using the authority to receive elite accommodation being assisted by the Moscow city hall). The supreme qualification panel of judges decided that there are no sufficient grounds for this. Moreover, it directed an inquiry to the Constitution Court on whether the voting for the decisions on bringing the judges to account should be taken by open or secret voting, and refused to consider the case in essence before the response of the Constitutional Court. In fact the case can be procrastinated for years. By the way, it is not A. IvanovТs first failure earlier he had to refuse from the announced initiative to abolish Moscow arbitrary court and establish three independent courts instead (this idea would lead to the cancellation of the post of the chairman of the Moscow arbitrary court, V. Sviridenko). In public, one cannot help to consider this as not only A. IvanovТs failure, but also D. MedvedevТs one.

In July M. KhodorkovskyТ lawyers submitted an application on grant of parole of the ex-head of YUKOS to the local court of Chita. Grant of parole, possible for convicts having served half of the term and condemned for the gravest crimes, can be given by the court taking into account the opinion of the direction of a penal system body. The penalties by the direction of the correctional facility, including small ones and difficult to prove, for example a refuse to greet an employee of the correctional facility, hinder the application of this norm. Khodorkovsky has penalties and though the law does not state directly that the granting of parole is not possible having penalties. The other way to become free is the appeal for pardon, which, in the opinion of the majority of lawyers, signifies avowal of guilt by the convict. That is why it seems that the count on the court is not justified when one comes to think about the results, and if the authorities, as they have declared, are ready to mitigate the punishment, they would prefer the variant of pardon.

The RF Supreme Court refused to answer to the claim of the Communist party and Right Forces Union on abrogation of election to the State Duma results in December 2007. the parties made the appeals that were similar in sense separately and had different arguments: the Communist Party stressed the unequal access to the mass media, administrative advantages of the Unifies Russia, while the Right Forces Union - the requisitioning of nearly all the published circulation of the propaganda materials. Both the parties presented the documents on electionТs falsification, though few, to tell the truth. Not only did the court refuse the claims, but also provided for another incident: the illegitimacy of agitation production requisitioning was proved.

Thus, it is possible in Russia, The CEC of Russia and the judicial system doing nothing, to block an election company of any party and consider afterwards that these violations did not affect the results of the elections.

In the field of the foreign policy, the main event was the first G8 summit in which D. Medvedev took part.

The problems of the world financial system, global warming, and energy dialogue were discussed. D. Medveded suggested conducting grain summits in connection with the growth of the world prices for foodstuffs and making the ruble a world reserve currency. The results of the summits were quite unusual. Together with China Russia banned the issue on introduction of sanctions against the leaders of the dictatorship in Zimbabwe1 at the security council of the UN. This event taken out of context is not very remarkable, since various countries often express a special opinion during discussion on issues of sanction introduction. The note The dictatorship in Zimbabwe attract special attention since R. Mugabe led county to the famine and hyperinflation and conducts the policy of the genocide towards the white minotiry of the country.

worthy is the fact that at the G8 summit Medvedev signed the general declaration calling for pressure on MugabeТs regime and then directly disavowed his signature. As a result the USA and the Great Britain accused Russia of breaching its responsibilities - this if the first formal censure of D. Medvedev at the official level, and its cause is not at all connected with the RussiaТs economic interests. The president election campaign in the USA that is in the full swing has once again raised the question of the relationships with the Russian government into the focus of the discussion: D. MacCain confirmed his intention to call for RussiaТs expulsion from the G8 and B. Obama declared his disagreement with it.

Real Economy: Trends and Factors O. Izryadnova In the first half of 2008 the macroeconomic situation was defined by sustention of business activity high growth rates in nearly all kinds of activities. Increase in industrial production was equal to 5.8% on the first half-year 2007, in investments in foxed assets - to 16.9%, in retail trade turnover - to 15.2%. There is some weakening of the development dynamics against the continuing growth of consumer prices and producersТ prices of industrial goods that is worrying.

At the beginning of 2008 the Russian economy is characterized by high growth rates of the business activity in nearly all kinds of economic activities. According to the preliminary data over the first half-year of 2008, increase in the GDP was equal to 8.0% against 7.8% in the corresponding period of the previous year.

The structure and dynamics of the GDP was primarily influenced by the trend for anticipating growth of investments in fixed assets and householdsТ consumption.

Specific features of the economic situation in the first half of the current year revealed in slackening of the growth dynamics by quarters. Slow-down of the GDP growth from 108.5% in the 1st quarter to 107.6% in the 2nd one is accounted for by deceleration of investments in fixed assets dynamics, industrial production and retail trade turnover.

Though in January-June 2008 investments in fixed assets growth rates remained at high level and were equal to 116.9% on the corresponding period of 2007, they decreased by 6.8 p.p. as compared with the previous year. The trend being for investments rates deceleration in the 2nd quarter of the current year, the workload in construction growth rates have reduced by 6.8 percentage points down to 18.3% as compared with 28.9% in the 1st quarter. In the first half of 2008 the reduction of housing construction impact on the dynamics of workload in construction: increase in commissioning of the total square of houses was 2.9% against 34.3% in January-June 2007. It is anticipating production and industrial objects construction growth rates during the first half-year that is the factor compensating slackening dynamics of housing commissioning. As a result of the 2nd quarter the extent of construction organizations supply with the orders remains at the level of the previous year, and the level of facilities load exceeded the level of 2007 by 2 percentage points.

At the same time increasing deepening of the gap between the rates of investment activities extension and investment goods production dynamics is worrying. Over January-June 2008 production of the main construction materials went up by only 8.9% against 53.3% in the corresponding period of the previous year;

production of cement decreasing by 2.6% and of saw-timber - by 3.7%. Over January-June 2008 machinery and equipment production rates were 110.4%, transport vehicles and equipment production - 116.8% against 139.1% and 132.9%, correspondingly, in the first half-year 2007. Shortage of competitive domestic production potential is made up by the increase in investment import: over January-May 2008 machinery and equipment import went up by 64.7%.

The dynamics of the industrial production in the first half of 2008 was extremely unsteady. As a result of the first half of 2008 increase in industrial production was equal to 5.8% against 7.1% in the corresponding period of the previous year. Rates slow-down was also observed for extractive and processing industries.

Over January-June growth rates in minerals extraction were equal to 100.5%, in processing industries - to 108.4% and in electricity, gas and water production and distribution - to 104.1%.

Growth rates in fossil fuels production being stable, growth in oil production in the first half of 2008 decreased by 0.6% on the corresponding period of 2007 and was equal to 242 mln of tons. The main factors for reduction in production were low efficiency of oil production because of raw materials base deterioration, difficulties in new oil fields development and underinvestment of funds in new production regions. In the first half of 2008 the total oil export is estimated to be 121.0 mln of tons, which makes 93.7% on the level of the corresponding period of the previous year. At the same time due to higher efficiency of oil products sales at the domestic market as compared with the export, oil supply to the Russian market has increased by 3.9%.

Gas production in the first half of 2008 reached 339 bln of cu. m. or 101.7% on the corresponding period of 2007. According to the preliminary data Russian consumers were supplied with 211.7 bln of cu. m. of gas in the first half 2008 or 97.8% of the level of the previous year and export supplies were equal to 109.6 bln of cu. m (117.7% on 2007).

The price for hydrocarbons being good, the proportion of the fuel and energy commodities increased by 6.1 percentage points as compared with January-May 2007 and was equal to 69.4%, whereas export value volume went up by 64% as compared with the same period, including oil export - by 59.5%, natural gas export - by 72.8% and oil products export - by 70.9%.

Changes in the structure of extractive industries proceeded against the background of anticipating growth rates of machine-building enterprises, rubber and plastic goods production (115.7%) timber processing and wooden goods production (113.3%). Electric, electronic and optic equipment production index in JanuaryJune 2008 was equal to 92.3% on the corresponding period of 2007.

Demand growth and state system for support of agricultural goods producers accounted for the sustention of the trend for the increase in tractors, combine harvesters and fodder harvesters. Urgent necessity to modernize existing fleet of railroad engineering and growth in amount of orders from join-stock company Russian Railways and private companies for rolling and drag-out stock defined the development dynamics for transportation machine-building production and connected production of general machine-building.

Increase in populationТs incomes and development of crediting system also had a positive effect on production dynamics. Growth of large-size household appliances production is continuing, which is due to output increase at assemblage enterprises especially in the special economic zone of Lipetsk oblast.

In January-June 2008 the production of passenger cars increased by 19.1% as compared with JanuaryJune 2008, which is mainly due to the increase in production at assemblage enterprises. It should be noted that the level of price competitive ability of cars of domestic models decreased, which results in reduction of domestic cars production and anticipating growth of sale of cars of foreign models that are assembled at Russian enterprises as well as import automotive engineering equipment. In January-June 2008 anticipating growth of transport vehicles and spare parts for them was observed in the structure of machine-building production import. Over January-May 2008import of automotive bodies went up by 57%, passenger cars - by 62.5%, trucks - by 69.4%.

In the first half of 2008 growth of real disposable populationТs incomes was equal to 8.1% on the corresponding period of the previous year, this index growth slowing-down in the 2nd quarter down to 6.9% against 9.4% in the 1st quarter.

Inflation processes at the consumer market accelerating and growth of real disposable monetary incomes slowing down a bit, the trade also reacted with slow-down of goods turnover from 116.5% in the 1 st quarter to 114.1% in the 2nd quarter.

According to the estimation, populationТs monetary expenses (RUR 11539.6 bln) exceeded monetary incomes (RUR 11519.5 bln), which is accounted for by high inflation expectations of the population. The share of consumer expenses in the structure of monetary incomes use in the first half of 2008 was equal to 73.3%, exceeding by 1.8 percentage point the figure of the previous year. It should be noted that the share of expenses for purchase of goods was equal to 56.9% of the total monetary incomes of the population against 54.4% in the corresponding period of 2007. High inflation and intensive growth of consumer expenses lead to the decrease of populationТs inclination for savings. Over the first half of 2008 only 4.9% of populationТs monetary incomes were used for savings in deposits and securities against 6.6% over the corresponding period of 2007. Situation with the currency purchase is comparatively stable: 5.7% of the incomes was spent by the population for foreign currency purchase, the figure that by 0.4 percentage points exceeds the level of the previous year.

It was prices growth acceleration that had a negative impact on real incomes increase. Over the first half of 2008 inflation was equal to 8.7% as compared with 5.7% in the corresponding period of the previous year.

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