Russia can be top economy if not complacent-Kremlin

By Guy Faulconbridge

MOSCOW, May 29 (Reuters) - The Kremlin warned on Thursday against economic complacency but said that if sensible policies were continued then Russia could be one of the world's top five economies by 2020.

Russia's economy is booming for a 10th straight year, buoyed by record oil prices, massive demand for natural resources and soaring domestic consumer demand.

But President Dmitry Medvedev's newly appointed chief of staff, Sergei Naryshkin, told the ruling United Russia party that economic stability was not guaranteed for ever.

At the meeting, which was closed to foreign media, Naryshkin warned against "implanting in the consciousness that the economic stability we have achieved has been given to us forever.

"High oil prices do not give a guarantee of macro-economic stability," Naryshkin was quoted by United Russia as saying. "A fall in prices is possible, a fall in the oil price which would lead to the destabilisation of the entire economy.

"To prevent a crisis we need a balanced, cautious budget policy which will be based on that money which has been earned through the growth in labour productivity."

Russia's nominal gross domestic product soared to $1.7 trillion in 2007 from less than $200 billion in 1999, the first year of the current boom. Until then, Russian gross domestic product had halved since the collapse of the Soviet Union.

U.S. investment bank Goldman Sachs predicts that Russia's economy will overtake Britain, France and Germany over the next few decades to become the biggest economy in Europe.