The economic downturn, which has exposed the deficiencies in Russia's economic structure, may well serve as an opportunity for the country to restructure its economic development model, analysts say.

Anti-crisis measures

Russia, the world's largest energy supplier, is sliding into its first recession in a decade as the global financial crisis dampens demand for oil and other commodities.

The country's gross domestic product (GDP) shrank by 9.8 percent year-on-year in the first four months of this year. In the same period, industrial production tumbled 14.9 percent, foreign trade volume plunged 45.3 percent and investment slipped 15.8 percent.

The Russian Economic Development Ministry has lowered its forecast for economic growth in 2009 from a 2.2 percent decline to a 6.6 percent contraction in view of the deteriorating economic indicators.

Against the dismal economic backdrop, the Russian government has been seeking ways to move out of the shadows of the crisis.

In an anti-crisis program adopted on Friday, the government pledges responsible macro-economic policy aimed at maintaining economic stability and creating incentives for the growth of the public's savings.

The plan also calls for stronger investment in the economy and the formation of an entirely new model of economic growth.

The government already spent 1.4 trillion rubles (US$46.7 billion) from its oil funds to carry out anti-crisis measures.

In a new federal budget for 2009 approved in April by the State Duma, the lower house of parliament, education, health care and pensions took priority, and 17.5 percent of expenditure was earmarked for the real economy.

Meanwhile, Russia's central bank has cut interest rates three times in a row since April in an effort to channel funds into the real economic sectors, reducing the refinancing rate to 11.5 percent from 13 percent.

Innovative economy

The economic crisis has indicated Russia's heavy dependence on energy exports and overseas borrowing. The "petro-dollar," which has played a positive role in stabilizing financial market and safeguarding people's welfare, failed to fuel an economic recovery.

Productivity in Russia is one-fourth the level in the United States and the output of innovative industries accounts for about 5 percent of the total economic output.

Jim O'Neill, chief economist of Goldman Sachs, said Russia relies excessively on the energy industry and needs to conduct in-depth reform so as to improve its economic prospect.

Russian economist Lev Freinkman, in an interview with Xinhua, said the international financial crisis will speed up the government's efforts to optimize its economic structure.

The federal budget for 2009 has been slashed, but expenditure on such high-tech sectors as space and nuclear industry will be retained, Prime Minister Vladimir Putin said last month. The government is expected to spend 300 billion rubles (US$9.66 billion) on these industries.