The Central Bank (CB) must guarantee a stable exchange rate of the rouble against the dollar; reduce the margin of the banks and the interest rate to the level of the average yield in the real sector of the economy. This proposal is the foundation for a conceptual project for an alternative monetary-and-credit policy of Academic, Sergey Glazev, Adviser to Russian President, Vladimir Putin.
The monetary-and-credit-policy (MCP) is the founding document of the CB, defining its working policy. Glazev is convinced that this strategy is now vague and pursues goals which contradict the interests of society. It is necessary to create “internal sources for financing economic growth” under the conditions of sanctions and external shocks. These sources must not depend on the price of energy on the foreign markets as they do now.
Apart from that, in the conditions of economic crisis, the CB should not only focus on measures reducing the inflation rate (to 4% by 2017); it must stimulate economic growth by expanding production. “The regulator must not limit itself to fighting inflation without linking it to equally-important economic and financial indicators of development in the country,” Glazev pointed out in his 34-page project and highlighted that the return of the economy to growth is possible if several conditions are met.Glaziev seems to understand that Russia is a currency sovereign and is able to take advantage of the expanded monetary and fiscal space it provides. Maybe not yet MMT, but a lot closer than the opposition liberals led by Alexei Kudrin. Putin has apparently decided to listen to Glaziev.
Discussing Russia’s Economy
Rustem Falyahov talks to Academic, Sergey Glazev.
Appeared in Bulgarian at A-specto, translated by Valentina Tzoneva exclusively for SouthFront