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GDP GROWTH RATE IN RUSSIA IN JANUARY - JUNE NOT TO TOP 5%, VOLSKY SAYS

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MOSCOW, May 27 (RIA Novosti) - The GDP growth rate in Russia in the first half of 2005 will not top 5%, forecasts Arkady Volsky, president of the Russian Union of Industrialists and Entrepreneurs, at the conference of the Moscow Confederation of Industrialists and Entrepreneurs.

"In the first half of the year, the growth rate of the GDP will not exceed 5%, while the industrial growth will not top 3.6% - 3.9%, Mr. Volsky said.

The forecast for the end of the year, he says, is even more pessimistic: the GDP growth is 4% and the industrial growth is 3%.

Mr. Volsky reminded the audience that according to the government's forecast the GDP will grow by 6.5% in 2005 and the industrial production - by 5.2%. But even these figures are 0.7% - 0.9% lower than last year, according to him. "Despite some gleams of optimism, the economic growth rate is steadily going down, Mr. Volsky stated.

In his opinion, in order to increase the economic growth rate, massive investment are needed. However, in this sphere, too, statistics registers a downward tendency. In the first half of 2005, according to Mr. Volsky's estimates, the growth of investments into the fixes capital did not exceed 7.5%, as against 10.9% in 2004. He expressed his regret that the government plans to decrease state investments in 2006.

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