Profits in non-oil sector of the economy continues to fall

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Прибыль в несырьевом секторе экономики продолжает падение

According to Rosstat, the Russian economy continues to increase its raw roll, ignoring the declarations of officials about the need to treat its dependence on oil and gas

The profitability of any business in the Russian Federation, except for extraction of minerals and their transportation abroad, is rapidly declining for the third consecutive year.

In January-April 2017 from all sectors of the economy, only the mining industry was able to show a significant jump in net income, whereas all other activities remained stable mode of collapse of the financial indicators, follows from the data of Rosstat, published on Tuesday.

So, profit in the oil and gas production jumped 3.5%, in coal production – by 2.4 times; in the whole extractive sector by 1.7 times. On the background of increase of tariffs and the increase in the supply of raw materials abroad 89% more able to capitalize on the freight Railways .

At the same time in the manufacturing industry balanced financial result decreased by 17.5% to 879,7 billion rubles for 4 months.

The profit of agricultural producers fell by 18.5% in wholesale and retail trade – 36.3%, in the sector of transportation and storage of goods – 13.3%.

In the construction of Rosstat showed a collapse of almost 5 times more than 16 thousands of construction companies registered in the country for 4 months in total were able to earn only 5.9 billion.

22.2% collapse profits of Telecom operators and communications companies; sector research activities the collapse reached 90.5%.

In construction the profit was dragged down overall production decline in trade – a weak recovery in consumer demand (only in APR retail for the first time since December 2014 showed an increase, and only 0.1%) and in manufacturing industry – the reduction of the state defense order, explains economist BCS Vladimir Tikhomirov.

As a result, virtually all companies, except those that are busy removing to the surface of the mineral resources, no funds for investment, he adds.

In the first quarter, according to Rosstat, capital investment in the whole country increased by 2.3%. But this figure is essentially a fiction, it is in the black only by investing in the same extraction of minerals and construction of pipelines the experts of the Center for macroeconomic research of Sberbank of Russia.

Half of all investment is a pipe, mining and the financial sector. In General, manufacturing industry, investment decreased by 6.7%, in metallurgy – 30%, in the manufacture of metal products – by 24.7%, in the sector of motor vehicles – by 32.2%.

A survey of CEOs that was conducted in April, showed that any positive changes in their sentiment there, says the Director of the Center for market research HSE George Ostapkovich.

First and foremost, businesses suffer from a lack of investment, high cost of credit and falling real incomes, which shrinks the final effective demand in the economy, says Ostapkovich.

Here, he says, need to add the “high deterioration of main funds in industry, relatively low labor productivity, lack of additional production capacities, a high level of economic uncertainty not the most favorable business climate.”

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