e:
(202) 628-7551 and 8548
consulates general:
New York and San Francisco
US diplomatic representation:
chief of mission:
(vacant)
embassy:
Ulitsa Chaykovskogo 19/21/23, Moscow
mailing address:
APO AE 09721
telephone:
[7] (095) 252-2450 through 2459
FAX:
[7] (095) 255-9965
consulates: St. Petersburg (formerly Leningrad), Vladivostok
Flag:
three equal horizontal bands of white (top), blue, and red

*Russia, Economy

*Russia, Economy

Overview:
Russia, a vast country with a wealth of natural resources and a diverse
industrial base, continues to experience great difficulties in moving from
its old centrally planned economy to a modern market economy. President
YEL'TSIN's government made significant strides toward a market economy in
1992 by freeing most prices, slashing defense spending, unifying foreign
exchange rates, and launching an ambitious privatization program. At the
same time, GDP fell 19%, according to official statistics, largely
reflecting government efforts to restructure the economy, shortages of
essential imports caused by the breakdown in former Bloc and interstate
trade, and reduced demand following the freeing of prices in January. The
actual decline, however, may have been less steep, because industrial and
agricultural enterprises had strong incentives to understate output to avoid
taxes, and official statistics may not have fully captured the output of the
growing private sector. Despite the large drop in output, unemployment at
yearend stood at an estimated 3%-4% of Russia's 74-million-person labor
force; many people, however, are working shortened weeks or are on forced
leave. Moscow's financial stabilization program got off to a good start at
the beginning of 1992 but began to falter by midyear. Under pressure from
industrialists and the Supreme Soviet, the government loosened fiscal
policies in the second half. In addition, the Russian Central Bank relaxed
its tight credit policy in July at the behest of new Acting Chairman, Viktor
GERASHCHENKO. This loosening of financial policies led to a sharp increase
in prices during the last quarter, and inflation reached about 25% per month
by yearend. The situation of most consumers worsened in 1992. The January
price liberalization and a blossoming of private vendors filled shelves
across the country with previously scarce food items and consumer goods, but
wages