In the first 7 months of 2014 imports were down 5.1% (almost all of which are manufacturing and machinery) compared to domestic production of the same produce which was up 2.4%.
The reasons for this are two-fold; first, a weaker ruble actually stimulates the industrial part of the Russian part economy while for many years has been crowded out by an over-valued exchange rate, and second, the long-term dynamics of domestically producing has attracted a raft of investment.
For instance, the auto market shows an enormous divergence between domestic and imported growth rates. Domestic car production has fallen by 0.7% in the first seven months of the year as a result of poor demand, but this is nothing compared to the more than 30% fall in imports. Domestically made cars are simply more cost competitive.
The trend is set to continue even as the demand side of the market recovers, domestic car production is expected to expand by 2.5% next year while imports are expected to fall a further 7.2%.
Complete story at - Russian Domestic Manufacturing is Booming - Russia Insider
The reasons for this are two-fold; first, a weaker ruble actually stimulates the industrial part of the Russian part economy while for many years has been crowded out by an over-valued exchange rate, and second, the long-term dynamics of domestically producing has attracted a raft of investment.
For instance, the auto market shows an enormous divergence between domestic and imported growth rates. Domestic car production has fallen by 0.7% in the first seven months of the year as a result of poor demand, but this is nothing compared to the more than 30% fall in imports. Domestically made cars are simply more cost competitive.
The trend is set to continue even as the demand side of the market recovers, domestic car production is expected to expand by 2.5% next year while imports are expected to fall a further 7.2%.
Complete story at - Russian Domestic Manufacturing is Booming - Russia Insider
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