Russia’s federal budget has surplus of 0.9% of GDP in Jan-Aug, consolidation seen in 2014.

By bne IntelliNews September 16, 2013

Federal budget surplus is estimated at RUB 389.4bn (USD 12.5bn) or 0.9% of GDP in Jan-Aug, according to flash estimates by FinMin. In H1, revised federal budget deficit was estimated at RUB 367.9bn or 1.2% of GDP. In August alone, federal budget surplus was at RUB 102bn or 1.8% of GDP.

To compare, in Jan-Aug 2012 federal budget surplus amounted to RUB 529.4bn. In 2012 federal budget was closed with RUB 12.8bn deficit of 0.02% of GDP.

In Jan-Aug 2013 federal budget revenues stood at RUB 8.42tn (65.4% of target for 2013). Budget spending was RUB 8.03tn (59.7% of target for 2013). It must be noted that budget spending usually soars abruptly in the fourth quarter of the year. In 2013, the federal budget deficit is targeted at 0.8% of GDP.

In the meantime, last week, the government discussed the budget consolidation measures for 2014. This followed EconMin’s cutting the GDP growth outlook for 2013 from 2.4% to 1.8% and for 2014 to 3% from 3.7%. The spending is going to be cut by 5%-10% in 2014-2016 as estimated by EconMin Alexei Ulyukaev and PM Dmitry Medvedev.

The FinMin also raised the federal budget deficit target from previous 0.4%, 0.6% and 0.6% of GDP in 2014-2016, respectively, to 0.6%, 1%, and 0.6%. FinMin Anton Siluanov commented that increased deficits will not be financed from the National Welfare Funds. Higher domestic borrowing and privatisation revenues are supposed to cover the deficits.

Prior to the FinMin has proposed to follow the same course and increase social spending in order to fulfill Vladimir Putin’s post-election promises, despite the slowdown of the economy and the worsening of macroeconomic forecast. In order to increase the funding of “Putin’s promises” in the absence of addition revenues, the FinMin offered to cut other expenses by at least 5%-evenly through all departments.

Related Articles

RBI doubles net profit y/y in Q1 as Russian business recovers

Raiffeisen Bank International (RBI), the second largest bank operating across Central and Eastern Europe by assets, reported that net profit almost doubled year-on-year to €220mn in the first ... more

Russia’s biggest bank fraud lands ex-CEO in jail for nine years

The former CEO of Russia’s Vneshprombank Larisa Markus has been sentenced to nine years in jail by a Moscow court for extracting about RUB113.5bn (EUR1.83bn), in what has become the ... more

Moody’s upgrades outlook on Moscow-based International Investment Bank (IIB) to positive

Moody’s Investors Service upgraded the outlook on the Baa1 issuer and debt rating of the International Investment Bank (IIB) from stable to positive, the bank said in a press-release on May 10. ... more

Register here to continue reading this article and 2 more for free or purchase 12 months full website access including the bne Magazine for just $119/year.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

To continue viewing our content you need to complete the registration process.

Please look for an email that was sent to with the subject line "Confirmation bne IntelliNews access". This email will have instructions on how to complete registration process. Please check in your "Junk" folder in case this communication was misdirected in your email system.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

If you have any questions please contact us at sales@intellinews.com

Subscribe to bne IntelliNews website and magazine

Subscribe to bne IntelliNews website and monthly magazine, the leading source of business, economic and financial news and commentary in emerging markets.

Your subscription includes:
  • Full access to the bne content daily news and features on the website
  • Newsletters direct to your mailbox
  • Print and digital subscription to the monthly bne magazine
  • Digital subscription to the weekly bne newspaper

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

bne IntelliNews
$119 per year

All prices are in US dollars net of applicable taxes.

If you have any questions please contact us at sales@intellinews.com

Register for free to read bne IntelliNews Magazine. You'll receive a free digital subscription.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

IntelliNews Pro offers daily news updates delivered to your inbox and in-depth data reports.
Get the emerging markets newswire that financial professionals trust.

"No day starts for my team without IntelliNews Pro" — UBS

Thank-you for requesting an IntelliNews Pro trial. Our team will be in contact with you shortly.

Dismiss