Economic situation in Russia

The Gross Domestic Product (GDP) or gross domestic income (GDI) is one of the measures of national income and output for a given country's economy. The Gross Domestic Product (GDP) in Russia was worth 1857.77 billion US dollars in 2011, according to a report published by the World Bank. The GDP value of Russia is roughly equivalent to 3.00 percent of the world economy. Production output is selected by branches: aircraft manufacturing, space industry, automotive industry, electronics.VOLUME OF WORK PERFORMED BY ECONOMIC ACTIVITY «CONSTRUCTION» BY ORGANIZATIONS in 2011 was 2276,6 bln.Transportation of goods by transport modes in 2011 was 8339 mln tons. Freight turnover by transport modes in 2011 was 4916 bln tons-km. Russia has the world's second-largest railway network, second only to that of the United States,Russian Railways, the state-owned national rail carrier, is one of the world's largest transport companies, enjoying a monopoly over rail transport in Russia.

Roads and highways. Road safety in Russia is poor with road accident deaths per million population higher than all countries in the G8 and the other BRIC countries. With a large land area the road density is the lowest of all the G8 and BRIC countries. Maritime transportation Plays an important role in Russian transit.Novorossiysk and Sochi are the main Black Sea ports Vladivostok, Nakhodka, Magadan, and Petropavlovsk-Kamchatskiy account for the bulk of maritime transportation on the Pacific coast. The largest Arctic port is Murmansk.

Russia's telecommunications industry is growing in size and maturity. There were an estimated 4,900,000 broadband lines in Russia. The external trade turnoverin Russia had the sharp decrease in 2009 that was connected with the fall of export and import after years of the world economic crisis. And since 2009 you can see the gradual growth of Russian trade, in 2011 it reached 2008 level and even exceeded it. Import of goods in 2011 again exceeded exports, but the volume of exports in value terms is still significantly higher than the import volume - 522 billion against 323 billion U.S. dollars.

Russia's main trading partner is still China, foreign trade turnover between Russia and China increased by over 40% compared to 2010 and exceeded 10% of the trade balance of the country.

The country's foreign trade structure of Russia occupies a special place in the European Union, as the largest economic partner of the country. The share of the European Union (Germany, Netherland, Italy, France) in 2010, accounted for 52% of Russia's trade turnover (in 2009 - 51.3%). The CIS countries in 2010 accounted for 14.5% of Russia's trade turnover

Russia views foreign investments as a driver for: 1)Accelerating economic and technical progress 2) Revamping and upgrading production facilities 3)Mastering advanced production management methods 4)Ensuring employment, training personnel capable of responding to the challenges of a market economy Russia’s inflation slowed to 3.7% in March as compared with the same month last year, which was below the 2012 target range of 5-6% stipu­lated in the Guidelines for the Single State Mon­etary Policy in 2012 and for 2013 and 2014.

Main methods of monetary policy of the central bank of the Russian Federation are : *quotas for certain types of assets & liabilities operations; *imposition of limits on the issuance of loans of different categories; *restrictions on the opening of the various branches & departments ; *limiting interest rates, tariffs, etc.; *tax measures; *regulatory measures.

Standard of Livinggenerally refers to the level of wealth, comfort, material goods and necessities available to a certain socioeconomic class, in a certain geographic area. An evaluation of standard of living commonly includes the following factors: * income * quality and availability of employment * class disparity * poverty rate * quality and availability of education * life expectancy * incidence of disease * cost of goods and services * infrastructure * national economic growth * economic and political stability * political and religious freedom * environmental quality * climate * safety

22 August 2012 Russia becomes the 156th WTO member. The transition period to liberalization of access to Russia's markets is two to three years, but this is extended to five to seven years for markets requiring more protection such as the automobile industry and agriculture, agricultural machinery production and light industry.

Estimates of the World Bank team of the gains in real GDP, wages, household income, and regional impacts We estimate that in the medium term, Russia should gain about 3.3 percent per year of the value of Russian GDP (or about $49 billion per year based on 2010 GDP at market exchange rates).

Political scenariosSince Putin came to power, political power in Russia has become more concentrated. Growing prosperity and political stability lead to a growing civil society. Combined with growing individualization this leads to a more mature political atmos-phere. In the long run, Russia could well develop a decentralized, democratic political tradition.

In the long run it is likely that Russia will move towards a more democratic stance. The mounting prosperity and greater globalization and individualization will pull towards democracy. In 2020, Russia is run by a strong presidential cabinet supported by the security apparatus. Economic, foreign, and security policy is run by the Kremlin. The Duma is dominated by a one-party system and the Federation Council has no real powers. Nationalism is a watchword, and that results in hardball diplomacy towards the SNG countries. The year is 2020, and Russia is dominated by the regions.

Economic ScenariosThe economic scenario cross for Russia A.D. 2020 is based on two uncertainty axes. One concerns whether Russia evolves towards a market economy (free enterprise) or whether it evolves towards a planned economy.The Russia of 2020 has a working liberal economic system, but it has failed to develop a differentiated production and service economy. The raw material-domi-nated industrial complex still constitutes a substantial part of the Russian econo-my. Russia is hence very sensitive to fluctuations in global raw materials prices. In times of global recession the Russian economy is weak and dependent, and in glo-bal boom periods the Russian economy booms.

2nd Economic Scenario: New Economic Superpower In this scenario, Russia has grown into a heavyweight in the global economy by 2020. Russia contributes strongly to globalization and is clearly part of international business life. Many Russian companies are players on the global scene. The Russian economy is very dynamic and has many participants. The former economic structure dominated by the raw materials sector has been replaced by a more diversified economic and industrial structure. More and more small and medium-sized private company crop up.

3rd Economic Scenario: 2nd World this economic scenario, the Russia of 2020 is characterised by government interference with the economy. Not the same interference that was common during the Soviet era, but still with some of the same signs. The Russian eco-nomy is still based on raw materials, and only feeble developments have been made towards a more differentiated production and service economy. The Russian economy is growing very slowly, almost not at all. Russia’s business life is dominated by great oligopolies, and there are growing internal inequities and lopsided economic growth. Bureaucracy, political cronyism, and corruption are basic facts of life.

4th Economic Scenario: New Soviet It’s Russia in the year 2020. Russia has developed a differentiated production and service economy and its dependency on raw materials has eased. There is considerable government interference with the economy. This interference has resulted in massive economic planning, and several sectors are protected by tariff walls, subsidies, and other government measures. Russia is trying out an industrialization strategy based on import-substituting industrialization in order to achieve complete independence. The goal is to create a combination of import-substituting industrialization and export-oriented industrialization. However, the attempt is not succeeding too well, and Russia is at a crossroad between protectionism and dependency on imports.

3 models of economics Australian model, Involves diversifying the economy while preserving the institutions of modern European society. Suggestions for Russia: 1.high or average growth rate of GDP 2.significant levels of foreign investment 3.increase productivity Mexican model. Mexican model is based on a market economy dominated by oil and gas sector Suggestions for Russia: 1.high rates of economic growth 2.moderate development of diversification

Nigerian model. Nigerian model assumes a low diversification, the economy is based on the weak political institutions.

9. Management : art or science.

Management has been defined in many different ways. Used collectively, management refers to individuals engaged in planning and decision making, controlling and directing the efforts of members of an organization and using organizational resources in order to achieve stated goals; on the other hand management is the process undertaken by one or more individuals to coordinate the activities of others to achieve results not achievable by one individual acting alone.

The well-known American business professor and consultant Peter Drucker believes that the work of management is to make people productive. To regain the competitive edge in the international arena, society must have managerial competence. Drucker’s view emphasizes performance, quality and service.

Another view of management is presented in the popular best-seller, “ In Search of Excellence” , where Peters and Waterman state, They emphasise mentorship, love for managing and working with people; managers are excellent communicators and value shapers, lightning rods to get the job done. The effective managers do intend to make employees productive and they also have the ability to inspire people.

All above mentioned can be summarized in the following definition of management:

Management is the process of achieving organizational objectives within changing environment by balancing efficiency, effectiveness and equity, obtaining the most from limited resources, and working with and through other people.

Why study management? Learning about management is important for two reasons.

First, our society depends on specialized institutions and organizations to provide the goods and services we desire. Managers have the authority and responsibility to build safe or unsafe products, seek war or peace, clean up or pollute the environment. Managers establish the conditions under which we are provided jobs, incomes, lifestyles, products, services, protection, health care and knowledge. It would be very difficult to find anyone who is neither a manager nor affected by decisions of a manager. Poor management is at the bottom of the most business failures. The second reason is that individuals not trained as managers often find themselves in managerial positions. Many individuals presently being trained to be teachers, accountants, musicians, or artists will one day earn their living as managers. They will manage schools, accounting firms, orchestras and theatre.

Managerial levels.The main responsibility of all managers is to use the resources of their organization effectively and economically to achieve its objectives.

As a business grows and has more people than the owner or chief executive can effectively manage, the problem is solved by introducing a second layer of managers. As the business continue to grow, a third layer of managers is introduced. These managers report to the second layer. In very large companies, there may be 10 or 12 levels of managers between the president and the worker in the factory.

Top-managers are more involved in long-range planning and policy making. They make strategic decisions concerning the future of the company.It is the job of a company’s top managers to take responsibility for innovation, manage a business’s relations with the outside world. Top managers are appointed, supervised and dismissed by a company’s board of directors.

Middle management and supervisors generally make day-to-day decisions which help an organization to run efficiently and smoothly.. Managers at this level spend a great deal of tome communicating, coordinating and making decisions which affect the daily operation of heir organization.

Functions of a manager. Henry Fayol, manager of a large coal company said that to manage is “ to forecast and plan, to organize, to command, to coordinate and to control”. In this way he identified five functions :

1)Planning. The manager should make the best possible forecast of events that may affect the firm and should draw up plans to guide future decisions. 2) Organising. This managerial function determines the appropriate machines, material and human mix necessary to accomplish the actions planned.3)Commanding. Managers should have direct, two-way communication with subordinates and continually evaluate the organizational structure and subordinates. They should not hesitate to change the structure if they consider it faulty or to fire subordinates who are incompetient.4) Coordinating. This function includes activities that bind together all individual efforts and direct them toward a common objective.5)Controlling. This means ensuring that actual activities are consistent with plans. Fayol’s definition is still accepted by many people today, though some writers on management have modified his description. Instead of talking about command, they say a manager must motivate or direct and lead other workers.

An interesting modern view on managers is supplied by an American writer Peter Drucker.:1) Setting objectives. 2)Organising. 2) Motivating and communicating. 3)Measuring. 4) Developing people. Good managers need not be geniuses but must bring character to the job.

Management skills.

The mix of skills differs depending on the level of the manager in the organisation. Theorists usually identify three different kinds of basic managerial skills: technical, human and conceptual, needed by managers at all levels.

Human skill is the ability to communicate, motivate and lead individuals and group(middle ranks).Technical skill is the ability to use the techniques, procedures and tools of specific field(lower levels). Conceptual skill is the ability to plan, coordinate and integrate all of the organisation’s interests and activities (upper levels).

Date: 2015-12-17; view: 1011