The central bank continues to try bringing inflation down while preventing an overly rapid appreciation of the real exchange rate. Inflation has accelerated somewhat and will most likely stay above the authorities’ 8-10% target range for 2005.The budget remains in surplus despite fiscal easing, thanks chiefly to revenues from high oil prices. Structural reforms appear to have stalled in 2004. The central bank has continued work on implementing reforms in the banking sector, but progress is proving difficult. Electricity reform has slowed markedly, and there is no sign of progress in gas-sector reform. The long-awaited liberalisation of the market in Gazprom shares is now in prospect, but the implications of Gazprom’s acquisition of the state-owned oil company Rosneft are mixed at best.

Population (000s), 2003	143 600
Area (000 sq km)	17 075
Currency	Rouble
GDP (Billion USD), 2003	433.5
Life expectancy at birth (Women, Men), 2002	72.9, 62.3
Total labour force (000s), 2003	73 800
Government type	Federation

Indicators	% change unless otherwise indicated
	2004	2005	2006
GDP growth	6.4	5.5	5.5
Inflation (end-year)	11.0	10.5	9.5
Fiscal balance (% of GDP)	3.5	2.0	1.5
Primary fiscal balance (% of GDP)	6.0	5.0	4.5
Current account balance(% of GDP)	10.2	11.1	6.8

Source: OECD© OECD Observer No 245, November 2004