MOSCOW, July 10 (RIA Novosti) - Both GDP and industrial production growth in Russia could be within 7% in 2007, a Russian deputy prime minister told a business conference Tuesday.
"I think economic growth will amount to at least 7% in 2007, and our industry could reach a similar level," Alexander Zhukov said.
Although the official forecast for GDP growth in 2007 is 6.5%, the Russian economics ministry has already said it will exceed it. The country's industrial growth has been forecast at 5.2%.
Zhukov said that the Russian government had pursued a policy of reducing the country's dependence on raw materials and speeding up growth in processing industries in the past few years.
The official said processing industries demonstrated a 12%-14% growth, with commodities lagging behind in the first half of 2007. However, residential housing construction increased the most in the same period - 40% year-on-year.
Zhukov also described an increase in capital inflow into the country as evidence of an improved investment climate. Last year net capital inflow exceeded $40 billion, while Russia has already received $67 billion since the start of 2007.
"Money used to flow out of the country before, and now car assemblies are appearing here and there, and capital is flowing into the energy sector," the deputy prime minister said.
However, Zhukov said capital inflow had been putting pressure on the national economy and pushing up inflation. "Our goal for this year is to keep inflation within 8%, and reduce it to 5% a year in the future," Zhukov said adding that this would improve further the country's investment climate.
