is in splendid condition financially.
The country’s seven biggest steel companies alone together generated revenues of US$ 26 billion and profits of US$ 8.5 billion in 2006. Apart from buying companies abroad, the steel foundries and aluminium groups are investing in new production plant at home, for which several billion US dollars are planned over the next few years.
Benefiting from the prices on the world’s raw materials markets, Russia’s gross domestic product (GDP) will grow by at least 6% annually until 2010 according to forecasts of the Ministry for Economic Development and Trade. But Russia’s companies need to invest more to satisfy the rising domestic demand.
In addition, the rapid growth in real incomes of over 10% per annum is forcing them to increase productivity. On top of that comes the ever stronger rouble in comparison with the US Dollar, which makes imports cheaper and exports more expensive.
To protect their competitiveness, businesses need new machinery and plant. Experts estimate the current market volume for mechanical engineering products at EUR 35 to 40 billion per year.
Source: bfai report 18.05.2007
