"The policy is good for some time but it causes economic instability in further prospects," he said.
According to Timmer, the deficit of the US current account in 2003 amounted to $540 billion, the funds accumulated by Russia in 2003 were $30 billion, which partly were invested into the United States treasury notes. It means that they financed the deficit of the US current account.
"We consider this policy to be rather expensive and not favourable for the developing countries since interest yields are smaller than loan interests and profits from own projects. It is hard to accumulate funds in foreign currency without stirring up ones own currency," he said.
The WB economist gave the example with China. It placed a significant part of state reserves in the US treasury notes where the money supply increased by 20 % a year for several years whereas the gross domestic product increased by 10 %.
"It so happened that the money supply exceeded the economic growth in the country," ha said.
Timmer also said that at present India and China reduced their investments into the foreign treasury notes and added that the USA must cut down such mechanism.
The WB expert said that Russia should have strong national currency not to depend on the varying rate of exchange.
"The concrete date for liberalisation and convertibility of ruble is not so important but it should not be done in a hurry. At first it is necessary to develop other systems, e.g. the banking system," ha said.
"If you want to change something you should do it when you are strong rather than when you are forced to," stressed Mr. Timmer.
"There was a boom for direct foreign investments in Russia in 2003 in the field of oil and gas production. The investments totalled $4 billion, with half of them being invested into the sector of oil production. It is difficult to compete with the oil sector in such a situation," said the WB leading economist.
According to Mr. Timmer, the increase of the direct investments may have been caused by the "circulation of capital" in Russia.
"It is rather the circulation of capital. It means that the money that were removed from Russia are coming back to the country. But I cannot assert it since I am not sure of that," ha said.
Timmer also reported that Russia increased the level of bonds releasing. Last year the sum amounted to $8 billion.
"Only in Mexico and Brazil the level is higher," he said.
