Add to favorite
Subscribe to our Newsletters Subscribe to our Newsletters Get Daily Updates RSS

Sochi Olympics May Boost GDP
3.03.2014 19:16
Sochi Olympics May Boost GDP
Photo Credit:

The Winter Games in Sochi are expected to boost the economy by 0.3 percent amid a continuing stagnation, says a report by the Russian Central Bank.

      According to it, the event will have a positive impact, especially in the first quarter, driven by more demand in the hotel, catering and transportation services. This could add an extra 0.3 percent to the national GDP.

      In terms of the long-term impact, there are concerns over the payback period of the newly-built facilities and their maintenance costs. But the long-term benefits will outweigh any negative factors in the long run.

      But even the most conservative projections will now have to be revised, after the markets collapsed on Monday following an announcement of a possible military invasion of Ukraine’s Crimea by the Russian army.

      The events in Ukraine have sent the Russian stock market and national currency in free fall, with the biggest blue chips like Sberbank or Gazprom shrinking by an average of 15-23 percent.

      The tough international response over Russia’s intentions in Crimea triggered a massive sale of Russian stocks. RTS sunk 13.32 percent to 1,098.51 points to hit a low since September 2009. MICEX plunged 11.64 percent to 1,276.59.

      A further fall by as much as 3 percent could force the stock exchange to suspend trading for 30 minutes. In case of a steeper decline, trading will be put off till next day. Throughout the day, the Moscow Stock Exchange suspended trading in the stocks of Mostotrest, FSK UES, Rosseti, MOESK, Kamaz, Mechel, Irkutskenergo after they devalued by more than 20 percent.

      According to the Exchange, the volume on the foreign exchange section broke the $42 billion threshold, double the February average of $22-23 billion. The Central Bank is forced to resort to mass injections to keep the national currency afloat.

      By 4.30 pm Moscow time, a whole raft of Russian giants were hit, including Gazprom (-14.56 percent), VTB (-18.82 percent), Gazprom Neft (-8.71 percent), Lukoil (-10.05 percent), Novatek (-14.42 percent), Norilsk Nickel (-6.19 percent), Polyus Gold (-9.29 percent), Rosneft (-7.62 percent), Rostelecom (-13.89 percent), Sberbank (-17.09 percent), FSK UES (-23.69%). The capitalization of the Russian companies listed on MICEX shrank by 2.1 trillion roubles to total 18.4. 

Author: Mikhail Vesely

Tags: Sochi Olympic Games 2014 Sochi 2014 Sochi Olympics Russian economy  

Next Previous

You might also find interesting:

Comment on our site

RSS   twitter      submit

Russian sport  Russian political parties  Colliders  Kabardino-Balkaria  Russian exhibitions  Russian society  activity holidays  Sergey Korolev  Progress Party  Moscow-Manchester flights  Fyodor Shalyapin  St. Petersburg  Russian economy  Russia ice hockey  Russian markets  Russian science  Russian Cinema  human rights in Russia  Ski resorts  Sokolniki  Tragedy  The Bolshoy Theatre   pensions  Moscow Metro  WWF  Russian Photographers  Kseniya Boguslavskaya  Exhibitions in Moscow  Photo Biennale  games  Tula  Mikael Tariverdiev  Boris Yefimov  anniversary  Svetlana Shkolina  Russian business  Kirov  Anichkov Bridge  Saransk FIFA Russia  Russian scientists  Moscow fountains  music  Black Sea  Russian tourism  Moscow  Victory Day  Primorye  Russian hockey  Mercedes-Benz Fashion Week Russia  Polymeric Memristors 

Travel Blogs
Top Traveling Sites