Russia has to stick to the austerity budget for a long period of time due to persisting unfavorable conditions, Prime Minister Dmitry Medvedev said Wednesday.
The budget for 2016-2018 has been drafted with difficult scenarios and negative predictions, as the budget parameters are mainly determined by the economic situation, he told a government meeting.
"We need to stay realistic ... and prepare a budget that will adequately respond to existing challenges," which includes falling oil prices, economic slowdown and continuous western sanctions, an online official transcript quoted Medvedev as saying.
Noting that the budget's main objective should be ensuring macroeconomic and social stability, Medvedev ordered the government to fulfill its social obligations regardless of difficult economic situation and limited budget resources.
However, the government possessed "few options" to increase financing of a number of programs in the coming years, Medvedev pointed out when suggesting to "promptly" list the projects that can be postponed until better times in order to optimize expenditure.Clueless.
Xinhua
Russian PM warns of long-term austerity budget
Russia has apparently swallowed the full austerity BS while China (see the other article posted on MNE today) doesn't hesitate to use counter cyclical deficit spending.
ReplyDeleteReading the piece on Russia one may feel as if it was really about some EU country - same ideological perspective on the need to cut budgets and be "austere".
Perhaps the time has come for Russia to ask for economic policy advice to Beijing.
For the moment, however, they seem to be getting their economic ideas straight from the usual Troika - aka "The Institutions" - of Brussels, Frankfurt and the IMF instead.
If oil goes back up to $100 they will be back in business.... revenues up, ruble up vs. USD reflecting increased REAL terms of trade... etc.. same for Venezuela: toilet paper back in stores, etc...
ReplyDeleteThe people in Russia that run finance and econ are generally liberals and wannabe Americans and Europeans, so they emulate Western liberal models.
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