Putin To Create Fund To Reduce Dependency on Western Imports

May 23, 2014 Share Print 0

Russian President Vladimir Putin said he will create a fund to invest in local production as he seeks to reduce his country’s dependence on Western imports.

Mr Putin said in a speech that Russia would cut its dependence on energy exports and pledged to boost major domestic banks and industries.

Mr Putin also said he was optimistic about resolving the Ukraine crisis.

Russia is in recession, according to the International Monetary Fund.

The IMF said on 30 April that $100bn (£59bn) would leave the country this year.

Russia’s economy contracted in the first three months of this year. The IMF cut its 2014 growth forecast for Russia to 0.2% from 1.3% and said it expected the country’s economy to grow by only 1% next year.

Russia itself has expressed concerns about investors moving money out of the country amid tensions and sanctions over its intervention in Ukraine.

Its central bank said $64bn had left the country in the first quarter of the year – more than the capital flight registered for the whole of 2013.

The exit of investor money has partly been prompted by US and EU sanctions targeting a number of Russian companies and high-profile business figures, including those close to Mr Putin.

The Kremlin will also respect the outcome of the presidential election in Ukraine scheduled for 25 May, Mr Putin told an economic forum in St. Petersburg.

via BBC

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Alfonso Esparza

Senior Currency Analyst at Market Pulse

Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.