Russian President Vladimir Putin said in Shanghai on Friday that his country's economy, boosted by reforms the government is undertaking, may grow by up to 5.8 percent this year.

Addressing the CEO summit of the Asia-Pacific Economic Cooperation (APEC), Putin said that his country's economic reforms include tax cuts and restructuring the huge state-owned energy companies.

"Last year our GDP increased by 8.3 percent and industrial output increased by 11.9 percent. This year we expected it to reach four percent, but in practice it will be 5.5, 5.7, 5.8 percent," Putin added.

Putin said the Russian budget was being financed in full, with state revenues rising. The agricultural sector was also recovering with a record grain crop expected this year.

"Russia has not seen this size of crop for many, many years and for the first time in the last few decades Russia has real export potential," he said. The crop is expected to be around 80- 82 million tons.

A report released Thursday by the Economic Committee of the Asia-Pacific Economic Cooperation (APEC) makes a similar forecast about Russia's economy.

The country's industrial production will grow by 5 percent, agricultural production by 3.5 percent and investment in fixed capital by 6 percent, according to the 2001 APEC Economic Outlook.

The year of 2000 was "the best year" in a decade for the country's economy. "Almost all macroeconomic indicators marked significant economic growth," according to the APEC report.

The main goals of economic policy for the period up to the end of 2001 and 2002 are step-by-step recovery of the real income of the people and the implementation of measures to reduce inflation and increase investment flows.

The report forecasts that the country's inflation rate, which was 120.2 percent in 2000, will be at 17-18 percent.

The growth in the economy resulted in the improvement of the labor market situation. The number of unemployed people fell from 12 percent in the beginning of 2000 to 9.6 percent by the end of the year.

(Xinhua News Agency 10/19/2001)