Russia may avoid a full-scale crisis despite global financial turmoil and can emerge from it with a more effective economy, President Dmitry Medvedev said on Thursday.
“We have a chance to avoid banking, forex or debt crisis and go through today”s difficulties without losing the potential we have created,” Medvedev said in a video blog posted on his official website www.kremlin.ru
Russian markets have plunged more than 70 percent since their peak in May amid capital flight and liquidity problems, fuelling fears of a financial crunch spreading into sectors of the wider economy.
The rouble collapsed during a 1998 economic crisis but a devaluation coupled with high international oil prices helped the economy recover.
The government says Russia, which has piled hundreds of billions of dollars in reserves during eight years of economic boom and has healthy fundamentals, can weather the storm.
The cabinet has come out with a rescue package topping $200 billion in credits for banks and companies and in tax benefits.
But avoiding panic and maintaining trust in the government remains a top priority in the country, where the 1998 crisis triggered public discontent and led to a political crisis.
Medvedev, dressed in a suit and white shirt but tieless, was calm and confident in a 6-minute address telling Russians that the financial squeezes would not affect the real economy and their jobs.
“Russia has not yet got into this difficult situation. It has chances to avoid this. It must avoid this,” he said.
Medvedev said the government would support the banking sector and six key sectors of the economy — retail, agriculture, construction, machine-building, the defense industry and small businesses.
