chancery: 2650 Wisconsin Avenue NW, Washington, DC 20007
telephone: [1] (202) 298-5700 through 5704
FAX: [1] (202) 298-5735
consulate(s) general: New York, San Francisco, and Seattle

US diplomatic representation:
chief of mission: Ambassador Thomas R. PICKERING
embassy: Novinskiy Bul'var 19/23, Moscow
mailing address: APO AE 09721
telephone: [7] (095) 252-24-51 through 59
FAX: [7] (095) 956-42-61
consulate(s) general: St. Petersburg, Vladivostok, Yekaterinburg

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@Russia:Economy

Overview: Russia, a vast country with a wealth of natural resources, a
well-educated population, and a diverse industrial base, continues to
experience formidable difficulties in moving from its old centrally
planned economy to a modern market economy. President YEL'TSIN's
government has made substantial strides in converting to a market
economy since launching its economic reform program in January 1992 by
freeing nearly all prices, slashing defense spending, eliminating the
old centralized distribution system, completing an ambitious voucher
privatization program, establishing private financial institutions,
and decentralizing foreign trade. Russia, however, has made little
progress in a number of key areas that are needed to provide a solid
foundation for the transition to a market economy. Financial
stabilization has remained elusive, with wide swings in monthly
inflation rates. Only limited restructuring of industry has occurred
so far because of a scarcity of investment funds and the failure of
enterprise managers to make hard cost-cutting decisions. In addition,
Moscow has yet to develop a social safety net that would allow faster
restructuring by relieving enterprises of the burden of providing
social benefits for their workers and has been slow to develop the
legal framework necessary to fully support a market economy and to
encourage foreign investment. As a result, output has continued to
fall. According to Russian official data, which probably overstate the
fall, GDP declined by 15% in 1994 compared with a 12% decline in 1993.
Industrial output in 1994 fell 21% with all major sectors taking a
hit. Agricultural production in 1994 was down 9%. The grain harvest
totaled 81 million tons, some 15 million tons less than in 1993.
Unemployment climbed to an estimated 6.6 million or about 7% of the
work force by yearend 1994. Flou