“Russia is heading for dismissal wave by deteriorating economy” – The Latest News

"Russia is heading for dismissal wave by deteriorating economy" – The Latest News

By: Editors
01/24/15 – 21:30 Source: Reuters Former Russian Finance Minister Alexei Kudrin and Vladmir Putin in concert. © anp.

Russia is heading for a real wave of redundancies as a result of the rapidly deteriorating economy. The Russian state should reconsider where money is spent and how fast it is decided to that spending. That Alexei Kudrin, Russish former finance minister, said during the World Economic Forum in Davos.

In the building sector Moscow are already 100,000 people laid off and the situation in the automotive industry is also on sharp

Alexei Kudrin

Kudrin says he the difficult period that Russia is going through all saw it coming, but the

seriousness of the situation he still is not easy. “Consumer prices have risen sharply, major layoffs have begun. In the Moscow construction industry are already 100,000 people laid off and the situation in the automotive industry is also on edge,” said the former minister.

The value of the ruble has plummeted over the past period. The currency has lost half of its value against the dollar since early last year. Russia can borrow money more difficult on western capital markets, as the country is plagued by trade sanctions imposed by the West following the Russian annexation of the Ukrainian peninsula of Crimea. The oil crisis has played an important role in the devaluation process.

Kudrin expects the Russian economy to shrink by 4 percent this year, if oil prices remain at current low levels. The Central Bank of Russia last month predicted a downturn of 4.5 percent for 2015. That Western sanctions will be lifted soon, according to Kudrin unlikely.