Russia’s finance ministry is sticking with plans to post a budget deficit of no more than 2% of gross domestic product (GDP) in 2023, despite towering spending and slumping energy revenues contributing to a huge shortfall in January.
Russia recorded a budget deficit of almost $25 billion in January, in part due to falling oil and gas revenues, the lifeblood of Russia’s economy.
That led analysts to forecast a budget deficit as wide as 5.5 trillion roubles ($73.2 billion), equivalent to 3.8% of GDP, unless prices for Russian oil recover.
“The main thing is to look at the budget balance, which will be formed at the end of the year,” Finance Minister Anton Siluanov said in an interview broadcast on Rossiya 24 on Friday. “And for the end of the year, our plan is 2% of GDP, no one has cancelled it, and these parameters will be maintained.”
It was a clear signal that Moscow intends to keep fiscal spending in check. The central bank, which has warned that a large deficit would feed into inflation and thereby force it to raise interest rates, last week said it was assuming the finance ministry would keep the deficit at planned levels.
This report’s information was first seen on ZAWYA; to read more, click this link.
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