Mortgage Crisis Worries Industrialists
( Kommersant ) - The monthly report by Rosstat, the state statistics service, did not provide an answer to the question of why industrial growth in August fell from its 5-10-percent level of spring and summer to 3.8 percent year-on-year. Investment growth slowed to 18.8 percent, compared to 27.2 percent in June, with price correction. The August level remains significantly higher than last year. Construction continues practically abated. The effects of world market instability will only be calculable in Russia toward the New Year.
In monetary terms, investment in August amounted to 584.2 billion rubles, 42.5 percent more than in August 2006. That number was higher only in December 2006. Growth for the year through August totals 22.1 percent, while the Ministry of Economic Development and Trade predict 12.8-percent growth for the entire year.
Experts say that changes in the construction rate may presage the increasing influence of the world economic crisis. While construction was up 25.5 percent in the first half of this year compared to the same period last year, it was up only 19.8 percent in August. Deutsche Securities analyst Yaroslav Lisovolik noted that it was harder to obtain financing because of the lower influx of foreign capital. Russian banks made up for the shortfall, but were forced to cut back on crediting to the public after their liquidity was exhausted. That should have led to lower retail trade turnover. According to Rosstat, the August rate was 16 percent, compared to a January-August rate of 14.7 percent.