le. Real fixed capital
investments have averaged gains greater than 10% over the last five
years, and real personal incomes have realized average increases
over 12%. Russia has also improved its international financial
position since the 1998 financial crisis, with its foreign debt
declining from 90% of GDP to around 28%. Strong oil export earnings
have allowed Russia to increase its foreign reserves from only $12
billion to some $120 billion at yearend 2004. These achievements,
along with a renewed government effort to advance structural
reforms, have raised business and investor confidence in Russia's
economic prospects. Nevertheless, serious problems persist. Economic
growth slowed down in the second half of 2004 and the Russian
government forecasts growth of only 4.5% to 6.2% for 2005. Oil,
natural gas, metals, and timber account for more than 80% of
exports, leaving the country vulnerable to swings in world prices.
Russia's manufacturing base is dilapidated and must be replaced or
modernized if the country is to achieve broad-based economic growth.
Other problems include a weak banking system, a poor business
climate that discourages both domestic and foreign investors,
corruption, and widespread lack of trust in institutions. In
addition, a string of investigations launched against a major
Russian oil company, culminating with the arrest of its CEO in the
fall of 2003, have raised concerns by some observers that President
PUTIN is granting more influence to forces within his government
that desire to reassert state control over the economy.

Rwanda
Rwanda is a poor rural country with about 90% of the
population engaged in (mainly subsistence) agriculture. It is the
most densely populated country in Africa; landlocked with few
natural resources and minimal industry. Primary foreign exchange
earners are coffee and tea. The 1994 genocide decimated Rwanda's
fragile economic base, severely impoverished the population,
particularly women, and eroded the country's ability to attract
private and external investment. However, Rwanda has made
substantial progress in stabilizing and rehabilitating its economy
to pre-1994 levels, although poverty levels are higher now. GDP has
rebounded and inflation has been curbed. Export earnings, however,
have been hindered by low beverage prices, depriving the country of
much needed hard currency. Despite Rwanda'