The Eighth Exchange Forum already died down, and we again saw specialists determining the vector of economic development of our country for a long time: the head of the Central Bank E. Nabiullin, Finance Minister A. Siluanov, the permanent chairman of the board of Sberbank G. Gref and, of course, the former minister Finance A. Kudrin. Of course, it is always interesting to listen to the masters, but perhaps the first problem they voiced was the lack of investment in our country. For example, in January, the inflow of foreign investment amounted to as much as 34 million dollars, which by the standards of the economy of the Russian Federation is a very small amount.
But why? Why have we been declaring for a decade the attraction of foreign investments to be the alpha and omega of the development of the Russian economy, and the money hasn’t come to us or is it going?
In fact, from the point of view of economic theory, the absence of massive investments in the economy of the Russian Federation seems to be completely absurd. A simple example is that lending rates in the Russian Federation are much higher than in Europe or the USA, i.e. On the invested capital, Russian banks extract much more profit than their European counterparts. According to economic theory, foreign banks should simply be in line for the right to open their representative offices in the Russian Federation. They can secure super profits by “trading money” at Russian rates, or they can conquer the Russian market by offering much more favorable terms of cooperation to domestic producers. From the point of view of economics, the Russian Federation is simply doomed to a “mass invasion” of foreign capital, after which, over time, the terms of lending in Russia and Europe would gradually be equalized, because banks would fight for the clientele, gradually lowering the cost of credit, t. e. % rates, as long as they (as well as profits earned by banks) would not be compared with average European ones.
But for some reason this does not happen. Where does economic theory fail?
In order to understand this, it is necessary to understand how the economy of the Russian Federation works. First, let's see what it consists of. Below is the structure of the gross domestic product (GDP) of the Russian Federation.
• Wholesale and retail trade - 17,2%.
• Manufacturing industry - 15,6%.
• Lease, government services and military security - 12,3%.
• Mining - 10,1%.
• Transport services and communications - 8,7%.
• Social Insurance - 6,6%.
• Construction services - 6,5%.
• Financial activities - 5,4%.
• Health and other social services - 4,2%.
• Agriculture and forestry, hunting - 4,0%.
• Production and distribution of electricity, gas and water - 3,4%.
• Education - 3%.
• Other community, social and personal services - 1,8%.
• Hotel and restaurant business - 1,0%.
• Fisheries - 0,2%.
TOTAL - 100%.
Recall what GDP is. This is the cost of the final product for a certain period of time, usually for a year. And what have the word "finite"? Let us explain with the simplest example. For example, a country's GDP consists of one stool with a market value of 3 ruble. A 3 person lives in the country. One made boards and sold them for a ruble, the second made nails and sold them for a ruble, and the third bought nails and boards made by them from the first two workers and made a stool for 3 rubles. So, GDP is the cost of the final product (stool), and not the sum of all products (ruble for boards, ruble for nails and 3 ruble for a stool - 5 rubles), because according to the results of labor activity, the state has only one stool, boards and nails are used for its production, and they are no more - despite the fact that their cost is taken into account in the market price of the stool.
Now look again at the structure of the Russian GDP. Contrary to the once-widespread assertion that in the Russian Federation, apart from a gas pipe, there is also an oil pipe, and there is nothing else, we are surprised to see that all mineral production, in which, besides oil and gas, is also ore, precious metals and other and other, is some 10,1% of the total volume of production. Hooray?
Let's wait to rejoice and look at the structure of revenues of the federal budget, or the state budget, as it is usually called.
And here we are surprised to find that the very 10,1%, which the mining industry provides, Russia's GDP (actually less, because the oil and gas sector is only a part of the mining industry) provides almost 44% of all budget revenues. Is it a lot or a little? Well, even offhand it is obvious that this is a lot, but we dig a little deeper.
Budget revenues from all other revenues, except for the oil and gas sector, are 7 694 billion rubles. Look at the costs. If you add up the social obligations of our state, those investments that it makes in the economy of the Russian Federation (and without which, obviously, you cannot collect the 7 694 billion mentioned above), education and medicine costs, we will get 8 049 billion rubles.
Thus, it is possible to ascertain a fact that is terrifying in its simplicity.
Even if world peace comes, and we will no longer need any armed forces ...
Even if all people suddenly heal according to conscience and the Law of God, and law enforcement agencies and courts will not be needed ...
Even if the creditors of the Russian Federation, external and internal, one and all, will forgive the Russian government for its debts ...
Even if we don’t spend a penny from the budget on media and culture, environmental protection and sports, we will transfer housing and public utilities to full self-sufficiency ...
And even if all state administration will be carried out completely free of charge, on a voluntary basis ...
... then in this case 90% of the economy of the Russian Federation, all our factories, transport, agriculture, trade, etc. etc. They will not be able to provide with money the level of education, pensions and health care that we currently have.
But, frankly, today's level of education is absolutely not amazing imagination. Free medicine is becoming more and more inaccessible, there are not enough doctors, it is often very difficult to get to specialized specialists, so you have to go to paid clinics, well, or sacrifice your health if there is no money for it. Pensions are on the verge of and beyond the subsistence minimum (real, not what is believed in our government). That is, in a good way, all of the above requires additional investments, but our economy (with the exception of the oil and gas sector) simply does not have the money for this.
Maybe we have scanty taxes? No, as a percentage of the cost of the product, our taxes are quite at the level - if you count all these VAT, personal income tax, tax on income, property, transport, payments to the pension fund, social insurance and other, etc., then the tax burden is quite comparable to Western countries. It is possible that they take a little more from their personal income than we do, but less from the revenues of companies, but the sum does not change from the permutation of the terms. Apparently, the problem is that the revenues, profits and wages of Russian companies are much more modest than in the West, hence the difference in the amount of taxes.
In other words, if the production and trade of almost any Western country provides it with tax revenues sufficient to cover the entire spectrum of state needs, including social security, defense (although they save a lot), and so on, then nothing like this happens in our country. And this suggests that our production, trade and services are in such a deep crisis that without an oil and gas backup they are completely unable to ensure the normal functioning of the state.
This was not always the case. The state budget of the Russian Empire did not have any super-profits from foreign trade, as the budget of the Russian Federation is doing now, and the USSR did not immediately “addict” to the oil and gas “needle”. It can be said that the problems that began in the economy of the USSR in the 60s of the last century gradually increased, but were not solved. As a result, already under Brezhnev, an economic crisis loomed on the horizon before the country. But it was here that high oil prices happened, and the USSR unexpectedly received a source of funding, which, in theory, could contribute to the improvement of its economy. Unfortunately, they did not manage to use this opportunity (although they tried), and high oil prices only delayed the crisis, and then the then leadership headed by M. Gorbachev began to look for a way out of changing the economic model of management.
The model was changed - the market economy replaced the planned economy. And now, and earlier it was argued that the market economy is much more efficient than the planned one. Our citizens have made huge sacrifices for the transition to market rails. Wild 90, indiscriminate lack of money and poverty, rampant crime, a monstrous demographic hole, because people often could not feed themselves, what kind of children are there ... The number of unborn is estimated at least in the millions, and how many people prematurely departed to another world?
But we paid the price, and here we are in a market economy, which seems to be much more effective than planned. But where is this effect? The late USSR could not meet its obligations without gas-oil props, because it lacked income from industry and commerce. 26 years have passed since the death of the USSR, but today's RF is just as incapable of meeting its obligations without high prices for oil and gas!
Thus, the first thing we have to admit is: despite the fact that more than a quarter of a century has passed since the collapse of the USSR, and that the “wild 90s” ended 17 years ago, we, the Russian Federation, have so far failed to create an effective economic model for our productive forces. The key problem of our economy is that it is fundamentally inefficient, and without awareness of this fact, we will never move forward.
As you know, the first step in a cure for alcohol addiction is the recognition of its presence. Until a man realizes that his problems are not in a stern boss, traitors-friends, or a cavalier wife, but in himself, in his craving for alcohol, he cannot recover. No wonder that people at meetings of anonymous alcoholics present themselves: "I am Bill, and I am an alcoholic!" Alas, our leading experts in the field of economics and finance do not want to "ripen to the root", as Kozma Prutkov testified. Instead of recognizing the existence of a problem (that the economic model they built is in fact inefficient), they are looking for an “evil boss” and a “fault-wife”: this time they are “found” in the form of a lack of foreign investment. That lack of investment is not the cause, but merely the result of our distress, they cannot recognize.
And yet - why did this happen? Why is our production less efficient than in many other countries? There are many reasons for this, and perhaps the first of them is that our industry (and trade) is in completely unequal conditions in comparison with the western one.
At some points it is objective. It is clear that the Russian plant in the Urals bears somewhat greater costs than a similar manufacturer in sunny Spain, where the concept of central heating is mostly unfamiliar. And it’s not so easy for a Russian farmer to compete with an Italian one who takes crops twice a year. But all this can be compensated - yes, just below the salary, slightly lower the standard of living ... but not at times!
But the availability of loans - is another matter. It is much more difficult for a Russian production worker to get a loan, and this loan will be three times more expensive than that of its western competitor. In other words, for the same price an “imported” entrepreneur will attract several times more funds! Investment loans are very widespread in the West, when an enterprise is credited for the acquisition of production capacity and returns a loan after many years, while such “long” loans are much cheaper than “short” ones. In the Russian Federation, in order to receive an investment loan, an enterprise needs to demonstrate such good financial performance that it is not at all clear why he needs a kind of loan. It, perhaps, the bank itself will credit, at the most reasonable price ...
As a result, the Russian manufacturer is severely limited in capabilities - his Western competitor is always able to mobilize a large amount of money for any project, to launch the newest production facilities much faster, and all this will cost him less than ours. That is why at one time the author of this article was taken aback from the tireless attempts of the Russian Federation to break into the WTO: how can we strive for equal competition if our industry and agriculture are in initially unequal conditions and there are not the slightest prospects for this to be corrected?
So, the domestic producer is desperately short of money, and those that are are very expensive. What to do? To this our pseudo-economists have a “brilliant” answer. You can not get money in Russian banks or they can not afford? No question - go borrow money in the West, we have a free country ... Formally, it really is - who prevents the average Russian holding from issuing a bunch of additional shares or bonds and selling them on the New York or Tokyo stock exchanges?
Nothing ... except for one thing.
As we see, the instability of the domestic economy obviously leads to the instability of the state budget, and our government cannot and will not tolerate this. But to create a sane economic model for the development of a country in which both the productive forces and the budget will acquire the necessary margin of safety, it does not work. This means that the government will either have to resign or come up with ways in which the sustainability of the budget will depend only minimally on the country's economy. It sounds absurd, but our government has such opportunities.
Here we live with a balanced budget, in which expenses are equal to revenues when the price of oil is about 70 dollars and suddenly - bang - oil falls by 30 percent, say, to 50 dollars. Of course, tax revenues that provide nearly half of the budget immediately subside "About the same 30%, and the money in the budget begins to be missed. But what happens if at this moment to take and bring down the ruble exchange rate to the dollar? Suppose a dollar was worth 30 rubles, but our Central Bank caught up a bit of a market panic, causing the exchange rate to rise to 40 rubles per dollar.
Of course, if it turned out that oil “slipped” to 50 dollars per barrel, it will cost these same 50 dollars, and we will sell for 50 dollars and not a cent more expensive. But if, with a dollar worth 30 rubles, the price of oil in rubles was 1500 rubles, then after the appreciation, it was already 2000 rubles, i.e. there is a “growth” in revenues on 33% ... The fact is that we sell oil for dollars, but we charge taxes in rubles, recalculating a dollar transaction into a ruble equivalent at the current exchange rate - respectively, our tax revenues from exported hydrocarbons will increase at once as much as 33% ...
And so it turns out that, dropping the cost of the ruble, the government increases tax and customs revenues to the budget in rubles. And the budget expenses remain the same as they were - all obligations for pensions, medicine and other things are calculated in rubles, and with a decrease in the exchange rate of the ruble, they no longer become.
Of course, free cheese is only in a mousetrap. By doing so, the state actually shifts the problems of the budget to its people. After all, we do not live in the Soviet Union, which tried to produce almost everything on its own. We live in the Russian Federation, and we all buzzed about integration into the global economy and how it is good. As a result, we have a huge dependence on foreign supplies - even at our own production facilities there are often imported machines that require imported components and consumables. A bunch of imported cars run along the roads, and they need imported spare parts, in the offices, imported computers, etc. Naturally, with the depreciation of the ruble, trading companies cannot keep the old prices for a long time - the stocks that were purchased at the “old” ruble exchange rate will be sold off, and then the prices must be raised ... As a result, prices are rising, and not only for goods we acquire abroad, but also to those that we produce ourselves ... only now we produce and deliver on imported equipment and transport. And this is how inflation begins. And the same pensioners, receiving the promised retirement benefits, see that now they can no longer buy them as much as they used to buy earlier.
But what is surprising is that the government will be able to turn itself to a high level of inflation. In order to understand this mechanism, it is necessary to understand the difference between nominal and real GDP.
Suppose a certain country produced exactly 2015 boxes of matches at the price of 100 rubles each in 1 year. Its GDP was 100 rubles. The following year, 2016, the country produced all the same 100 matchboxes, but because of inflation, they began to cost 1 rubles. 10 cop, i.e. inflation was 10%. Thus, the nominal GDP of this country amounted to 110 rubles. - that is how much 100 boxes of matches in 2016 prices cost. Can we be glad that the country's GDP has grown by 10%? Obviously not: real GDP remained exactly the same as it was in 2015, 100 rubles, because in 2016, the country produced exactly as many products as last year, i.e. 100 boxes.
In other words, real GDP is nominal GDP minus the effect of inflation. The problem is that if the country produced only matchboxes, it would be easy to track inflation just by counting the quantity of goods produced, but if a huge amount of this product is produced, then it will not be counted in pieces, only rubles, and there are already possible manipulations.
Imagine such a situation. In 2015, the country produced 100 boxes of matches on 1 rubles, respectively, GDP = 100 rubles, and in 2016, the country produced only 95 boxes, but on 1 rubles. 10 cop., And nominal GDP amounted to 104,5 rubles. What to do? In fact, real GDP in 2016 g of the total 95 rubles. and decreased by 5% compared to last year, but what if ...
... what if you declare real GDP in 100 rubles. and inflation in 4,5%? Grace. First, we can say that, “despite the difficult economic situation, the economy has reached the bottom and is no longer declining,” and confidently talk about future growth (while production is falling), secondly, the level of indexation of pensions and public sector wages is no longer 10%, but only 4,5%. And if, nevertheless, a decision on indexation is made, the pension will still not restore its purchasing power.
The author does not have reliable information that the government uses this tool. But tell me, dear readers of "VO", when you enter stores, do you think that official data on the level of inflation ... somehow does not correspond to the realities of life?
Well, now, having figured out the impact on the budget of artificially lowering the exchange rate of the ruble and inflation, we will put ourselves in the place of a manufacturing enterprise, which is invited to look for money to develop business abroad.
Most of our enterprises operate mainly on the domestic market, because, having no equal conditions with foreign companies and not having their capabilities, it is difficult for them to compete with products of foreign manufacturers in foreign markets. Therefore, the bulk of the revenue of our companies is ruble. Well, let's say, I placed such a plant somewhere in New York, millions of dollars for 10 dollars, bought 300 million rubles for them (at 30 rubles per dollar) and bought the latest equipment from another Russian factory, thereby stimulating domestic manufacturer. Beauty! The plant operates, sells products, and in order to return foreign debt, it will subsequently need to collect 300 million rubles.
And then the price of oil suddenly fell, the Central Bank "raised the price", and the dollar now costs 40 rubles. And our plant suddenly discovers with surprise that instead of 300 million. Rub. He already owes 400 million rubles! His foreign currency debt has not increased, it still remains 10 million dollars, but in order to return it, the company will need 400 million rubles already. So, quite unexpectedly and from scratch, the plant's debt grew by 33%!
The problem is that the benefit that the Russian budget acquires as a result of the devaluation of the ruble boomerang at companies with dollar debts - they lose money in roughly the same proportion as the budget acquires them. As a result, any dollar loans turn into a real “Russian roulette” for enterprises operating on the domestic Russian market, because if a significant devaluation of the ruble occurs during the period of their operation, then the enterprise can easily be brought to bankruptcy with an unexpectedly increased debt.
Well, now let's return to the question: why foreign investments “do not go” to the Russian Federation?
First of all, you need to realize that, with very few exceptions, no foreign investor will go to us to create a transnational corporation, which will sell the bulk of its products for export, i.e. outside of the Russian Federation. Many foreign investors agree to buy such a corporation, if we have one, but they will not create it with us - why? They will better create such production in their own country. It is quite another thing to invest in Russian production for the development of the domestic market of the Russian Federation, so they are, in principle, ready for this. But ... this means that a foreign investor "comes on the same rake" as the plant, attracting foreign investment from the example described above!
We will put ourselves in the place of an investor who reasons to give or not to give our plant 10 million dollars from the example above. The investor is well aware of the complexity of the situation in which the plant may end up after the devaluation of the ruble - after all, its debt to the investor will increase (in our example) with 300 million rubles. to 400 mln. rub. The investor realizes that this happens, and the risk of default on the bonds he purchased will increase dramatically. Why does a foreigner need this risk? They invest for profit, and for the sake of risk they engage in extreme sports ...
The problem is that the instability of the ruble exchange rate, which is used as a "magic wand" to patch budget holes, is the strongest "scarecrow" for any potential investor. We ourselves push investment away from ourselves, and then we are surprised at something else.
Naturally, no privatization will help anything in this situation. We don’t have to wait for foreign investments, or they will buy out high-yielding oil and gas assets, the sale of which, generally, with the rarest exception, should be considered as a state crime. As for the internal reserves ... in fact, they do not exist in nature.
Of course, Forbes is full of faces of our billionaire compatriots, but you need to understand - very often, if a person has a fortune of 20 billion dollars, this does not mean that he has somewhere in the American bank 20 billion dollars. This means that he is the owner of heaps of “factories, newspapers, steamboats”, which are estimated at 20 billion dollars (and are often estimated by appraisers of our oligarch). But in fact, these plants often do not bring much profit, but they are heavily credited and lack working capital. And it is quite possible that in the state of 20 billion dollars, the oligarch is unable to earn 20 million dollars for investments without resorting to loans. But the loans should be given back, and as a result, a team of “effective managers” immediately sent to the newly privatized enterprise that fell into its ownership, starting as if it were a vacuum cleaner to draw money in order to “beat off” the funds invested in the acquisition ... with clear consequences for enterprises. Credits are immediately attached to it, which are then withdrawn, there is still not enough money in circulation, and in the end the question comes down not to development, but to survival. How to survive? Here comes the downsizing, etc. etc. It goes without saying that no increase in efficiency can be expected from such privatization.
To the great regret of the author of this article, he has to state: it’s not even bad that the economic model of the Russian Federation is not effective. The really bad thing is that the government of our country has long learned to exist and maintain stability in the conditions of a permanent economic crisis, in which the economy of the Russian Federation has been staying for 26 for years. And therefore our government has no reason to change anything - the current situation quite suits him.
Of course, once there should have been a counterbalance to the official economic doctrine, and something like this gradually appears, and no longer at the level of “kitchen talk”: a person like Sergei Yuryevich Glazyev, for example, points to the inadmissibility of the current course. -so is an adviser to the president of the Russian Federation. But one can hardly expect that his ideas will be perceived as a guide to action in the coming years - one, unfortunately, is not a warrior in the field, but who else among the authorities shares his views? ..