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Oil Prices Help Russia's Middle Class Grow


As leaders of the world's industrial nations and Russia meet in St. Petersburg for the G-8 Summit, the country they are visiting has undergone many changes in recent years. One change is the increasing prosperity of the middle class. Crystal Park narrates.

Dennis and Marina Shelipanov are living better these days than they ever thought possible. They are now able to afford a second car, something unthinkable in the past.

Dennis is a doctor and Marina is a dentist. But until recently these were underpaid professions in Russia. But a recent increase in government spending for health care has boosted their salaries.

The Shelipanov's are not the only Russians thriving in the current economy. City streets are full of luxury cars and cafes are packed with customers. The economy has grown by six percent and unemployment has been cut in half. The reason for this current economic renaissance -- oil.

High oil prices have led to an economic boom in Russia. Oil export revenues have increased from close to $9 billion in 1998 to more than $58 billion in 2004.

For Marina Shelipanov, it's not just about buying everyday things.

She says they can now make plans, think about providing for their son and, at some point, try and buy a house.

The economic boom has also led to huge discount chains like Ikea opening up stores in the country.

Stephen Sestanovich is a senior fellow for Russian studies at the Council on Foreign Relations. "The government has balanced its books. It's awash with money and is able to pay the salaries that make a middle class."

For the Shelipanov's, the new Russian middle class means a chance at stability.

Dennis says with stability and peace there is some sort of belief in the future.

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