Russia’s investment potential by far exceeds the current level of investment, Hans Timmer, Manager for Global Trends in the World Bank's Development Prospects Group, said at the presentation of the Bank’s Global Development Finance report.
According to Mr. Timmer, the current inflow of investment in Russia is 20 percent of the GDP, which is very little for a country that has almost completed a transition period. He said the Russian economy was currently growing 5 percent a year, and a growth of 4-5 percent was expected in the future. Countries with such growth rates should attract investments in the amount of 60-70 percent of the GDP, the analyst stressed.
He said foreign direct investment in Russia increased, but it is still less than 1 percent of the country’s GDP, which is very little. Mr. Timmer added that the largest part of investments was made in the raw material sector, which was not satisfactory. In developing countries, this indicator is about 2 percent, and about 2.5 percent in the least developed nations.
In the estimation of World Bank analysts, foreign direct investment in developing countries continued to drop in 2003. It amounted to $135bn, 23 percent less than two years earlier. In 2004, they expect a rise in foreign investment due to an overall economic revival.