Varieties of brick. Anton Zhogin - about the crop of problems

At the end of spring, there were allegations that Russia this year "awaits a record crop of grain." But the Russian economy, in all likelihood, expects, and not only this year, a completely different crop - a crop of problems. Many (violation of the logistics chains and the lack of imports of components and equipment) are already burdening the economic sphere, others are not yet not so sharp, but already known, others are only emerging.

Perhaps it is worth starting with restrictions on importing oil, coal and gas from Russia. The coal embargo should enter into force in August, oil at the end of the year, a reduction in gas imports began. Oil and gas revenues are extremely important for the state budget, and their loss, especially in combination with other negative factors, will cause a heavy blow to the economy. Alternative oil and gas sales markets will not be able to completely replace the European: there is less demand, higher supplies, there are no transport capacities. But income from working with alternative markets may be under a blow, if the diplomatic efforts of the G7 countries to establish a ceiling of prices for Russian oil will be successful. The probability of such an outcome largely depends on a combination of economic and political factors. So far, any significant political benefits that oil importers could receive, refusing to establish such a price ceiling. Even if there is no reduction in oil and gas exports, the industry will still encounter difficulties-due to the ban on the supply of Western equipment, the care of foreign partners who carried out its maintenance, as well as oilfield services that provided deposits development services.

In the Russian media, we can find reasoning that the EU rejection of the import of Russian oil will lead to an economic decline in Europe. Indeed, such a risk exists, especially since experts back in 2021 expressed an opinion on the possibility of a coming decline in the world economy. At the same time, Russian media do not mention that such a decline can hit the Russian budget. Why? Everything boils down to the relationship of the global economy and oil prices: an economic decline entails a decrease in production activity, oil demand falls, and prices are reduced. The growth in inflation in the world increases imports for Russia. Even without additional difficulties, the combination of these two factors looks unfavorable for the national economy.

As for coal, China could become a possible alternative market for him, but everything is resting on transportation: now the Trans-Siberian Railway is overloaded, and in case of large-scale attempts to reorient trading flows to the southeast, the problem will only aggravate. Another, not obvious, difficulty is associated with the transportation of goods along railways: after the departure from Russia, the Amsted Rail , SKF and Timken campaigns, Russian carriage construction lost access to cassette bearings necessary for modern freight wagons. The alternative to cassette bearings are roller bearings, but they not only cannot be used in "innovative" wagons, but also require more frequent replacement.

There are problems in the construction industry, as in the primary housing market, since these markets are very interconnected. The fall in the demand for real estate entails a decrease in demand for the construction of buildings, and through this demand for building materials. On the other hand, problems with the production of building materials lead to an increase in prices, which turns into an increase in prices for primary real estate. Problems in both areas are already noticeable. The construction industry records the lack of imported building materials, at the same time, domestic enterprises producing building materials depend on imported equipment and spare parts. According to the study of the national association of manufacturers of building materials and the construction industry, the production of 11 out of 26 types of building materials is completely dependent on imported equipment. These building materials include: three varieties of brick, aerated concrete, porcelain stoneware, tiles of two varieties, plumbing ceramics, self -tapping screws, etc. Production of other types of building materials depends on foreign equipment by 70–90 percent. Of course, it cannot be argued that such a dependence will immediately affect the entire construction industry, but as the necessary equipment fails, the production level will decrease steadily.

40% of Russians who need to improve housing conditions will not be able to take a mortgage even at zero percent

As for the demand for real estate, in March this year it increased, but by the end of April it was replaced by a catastrophic fall, which sometimes reached almost 100%(in the mound, demand fell by 97%, in Kazan by 98%, and in Volgograd by 99%). Attempts to influence the situation by issuing preferential mortgages are also unlikely to be effective. The head of the financial agency Dom.rf Vitaly Mutko indicates: 40% of Russians who need to improve housing conditions will not be able to take a mortgage even at zero percent, and even the maximum decrease in the interest rate will not be able to radically change something. There is another nuance: the acquisition of housing, including with the help of a mortgage, is always a "decision for the future." It is doubtful that a person who is not sure of tomorrow will decide to buy a house or apartment on credit, and there are not so many reasons for such confidence for such confidence. In March-April, by the way, the mandatory observance of the "Technical Regulation on the safety of buildings and structures" was canceled; I believe that not everyone will be ready to take a chance and buy an apartment in a house built without taking into account safety requirements.

The Russian auto industry and the automotive market are faced with the same problems as the construction industry and the housing market: dependence on imports and a drop in demand. In May, the production of cars decreased by 96.7%, trucks by 39.3%, and internal combustion engines by 57%. And the drop in demand for cars in June amounted to 82%.

The decline in production touched not only the automobile industry, in May a significant, more than half, a decrease in the production of passenger cars, freight cars, locomotives, fiber -optic cables, refrigerators, washing machines, electric motors, excavators were recorded.

The calculations that the “parallel import” will cover the needs of industry are seemingly excessively optimistic. The presence of intermediaries and lengthening of supply routes will undoubtedly affect the cost of the goods. The second reason is the difficulty with the search for alternative supply routes, since participation in a “parallel import” for an intermediary is fraught with risk to incorporate secondary sanctions. It is worth recalling the statement of the President of Kazakhstan Kasym-Zhomart Tokaev that Kazakhstan will not help Russia inpass sanctions, but it seems that it was for this country that the Russian authorities had hopes as a “transshipment point” in the supply routes of suction goods. Another reason is that many foreign campaigns not only do not want to supply their products to Russia, but are also ready to make additional efforts so that these products are not delivered by “roundabouts”. It is clear that the more highly specialized the goods are, the lack of which is noticeable, the easier it is to provide measures that prevent its delivery to Russia bypassing sanctions. But it is precisely such "inaccessible" goods that, as a rule, are the most necessary.

Economics Russia is arranged so that many cities and even regions are strongly dependent on any one industry. The regions with a high level of resource dependence include, in particular, the Nenets, Yamalo-Nenets, Khanty-Mansiysk and Chukotka Autonomous Okrugs, the Republic of Sakha, the Trans-Baikal Territory, the Komi Republic, the Tomsk, Orenburg, Irkutsk, Magadan, Tyumen, Sakhalin and Kemerovo regions. Here are more specific examples: in the ratio from the total revenues to the budget from the resource mining industry in 2019, they amounted to: in the Tyumen region-69.2%, in the Nenets Autonomous Okrug-69.9%, in the Yamalo-Nenets Autonomous Okrug-76.3%, in the Orenburg region-64.4%. These are only individual examples, but the industry of many other regions to one degree or another also depends on export or imports; The more industrially developed the region, the more it is integrated into the world economy and the greater the economic decline awaits it.

Negative trends are visible not only in industry, but also in the service sector. A third of the companies working in this area reported on the fall of profits in the second quarter of 2022, 11% of the companies were forced to go to the state. A significant share of these companies refers to small and medium -sized businesses and does not have large financial reserves, which makes such enterprises more vulnerable to economic shocks. As for the business as a whole, in the period from March to June 113.53 thousand companies closed in Russia.

All this smoothly leads to the consideration of another problem - unemployment. Its reasons are as follows: departure from the country of foreign and the closure of Russian companies, a decrease in exports and imports, a decrease in the purchasing power of the population, leading to a decrease in profits and reduction of jobs. There is no official data on the significant growth of unemployment, but this is what; Many potential unemployed so far continue to formally remain "attributed" to their jobs. This statistics are formed in a special way, it is based on the calculation of the number of people registered on the labor exchange. The growth of unemployment itself will lead to a decrease in tax revenues to the budget and purchasing power of the population.

Strengthening the ruble - a consequence, on the one hand, of the stabilization measures of the Central Bank, and on the other - a consequence of a violation of the balance of import and export. Too strong ruble is not beneficial to the Russian economy, since the price of export goods is calculated not in rubles, and according to the results of transfer to rubles, the same amount of export gives less rubles than it would be at a low year. The situation is so difficult that the Minister of Finance Anton Siluanov made a statement about the readiness to use the currency intervention mechanism, using the money intended for the implementation of state programs for this. Not all economists agree with this, and, however, there are other ways to influence the ruble. But many of these mechanisms are like a stick about the two ends: they can cause an abuse of a noticeable jump in prices.

Over the past ten years, the growth rate of the Russian economy has been about one percent per year, while since 2014, real incomes of the population have decreased by 8.5 percent. In other words, the seeds of new economic problems fell into already fertilized soil, so it remains to wait for the crop.

Anton Zhogin - Blogger

Opinions expressed in the heading of "blogs" may not coincide with the point of view of the editorial