Investment activity in Russia has slowed somewhat amid high cost of loans, deposits more profitable - PM Mishustin

MOSCOW. Nov 14 (Interfax) - Growth in domestic investment in fixed capital in Russia exceeded 10% in the first half of 2024, though investment activity has recently slowed owing to borrowed capital being more expensive and deposits being more profitable, Prime Minister Mikhail Mishustin said at a meeting on economic matters.

"Federal State Statistics Service (Rosstat) data indicate that investments increased over 10% in the first half of 2024. We are also currently seeing some decline in activity in this area primarily because deposits are more profitable than investments today, and the cost of borrowed money is unfortunately high," Mishustin said.

Carrying out assigned plans and implementing national projects "requires closer coordination between all the parties responsible, including the Economic Development Ministry, the Finance Ministry and the Central Bank," he said.

"Coordinated work when determining, among other things, fiscal and monetary policy is one of the most important tasks, primarily in key areas with regard to inflation expectations," he said.

The situation in priority sectors that help to develop the supply side economy should be continuously monitored. "This means those areas of activity which could potentially raise productivity and increase production," Mishustin said.

It is necessary to conduct an analysis of supply and demand within industries, he said. "It's important to carefully track prices on the domestic market. The level of citizens' real incomes depends on them and their dynamic," he said.

It is necessary to "develop consistent and predictable management of preferential programs," he said. The principal directions of economic development have been determined for this, including developing and introducing innovations and homegrown solutions, increasing production capacity and expanding the service sector, modernizing infrastructure, enhancing the country's scientific, educational and tourism potential and developing agriculture, the chemical industry and metallurgy.