Russia’s receives 61.9 % more foreign investments than 2002

Nov 18, 2003 01:00 AM

Russia received $ 20.9 bn of foreign investment in the first nine months of 2003, or 61.9 % more compared to the same period a year ago, the State Statistics Committee said. The figure included $ 4.67 bn of foreign direct investment, which rose 77.3 % on the same period last year, the committee said.
Foreign investment to Russia was $ 12.7 bn in the first half of the year, including $ 2.5 bn direct investment. Investment growth was a major driver for Russia's more than 6 % economic growth in the first nine months of 2003 but a probe into oil major Yukos set off fears that investors may choose to wait until the legal dispute is resolved.

The committee said that cumulative foreign investment since the fall of Soviet rule to the end of September was $ 53.6 bn, an increase of 34.7 % on the first nine months of 2002. Direct investment amounted to 46.2 % of cumulative foreign investment while credits from international financial organizations and loans for trade made up 51.7 %.
Portfolio investment amounted to 2.1 % of cumulative foreign investment at the end of September, down from 3.5 % in the same period a year ago. The main investor countries were Germany, the United States, Cyprus, Britain, France and The Netherlands, which accounted for 70 % of cumulative and 70.8 % of foreign direct investment to Russia.

The committee also said that industrial production jumped 7.2 % in October year on year, as high world prices for oil and gas led the country's biggest companies to pump more fuel, driving demand for steel pipes and pumping equipment. Output, adjusted for the number of working days, grew at the fastest rate since May.
Production of oil, coated steel, pipes and food led the increase. Chelyabinsk Pipe Works, Russia's second-largest steel-pipe maker, said it boosted production 39 % last month.

The country pumped 10 % more crude in October than in the year-earlier period, the State Statistics Committee said. It produced 18 % more pipes, 18 % more coated steel and 9 % more construction materials. The food industry's output rose 10 % as well as machine building.
The price of Urals, Russia's blend of crude oil, has risen 10 % in the past six months. It averaged $ 28.02 a barrel in October. Prime Minister Mikhail Kasyanov said that projections for gross domestic product growth will likely be revised upward to more than 6 % thanks to strong performances by the Russian manufacturing sector. Officially the government is planning on economic growth of 5.9 % increase in 2003.

Source: Moscow Times
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