Deputy Minister Andrey Klepach gave a briefing on the long-term macroeconomic forecast
On 12, April, 2012 in Moscow Deputy Minister Andrey Klepach gave a briefing on the updated long-term macroeconomic forecast till 2030.
Russia needs deficit to boost growth-Economy Minister
Russia will need to run a budget deficit over several years to boost its economic growth rate, according to a long-term economic development plan drawn up by its Economy Ministry.
"Every economist always says that it's better to have a deficit-free budget ... but that's a banality," Deputy Economy Minister Andrei Klepach said in remarks released for publication on Friday.
A limited deficit was needed "to make a breakthrough from the point of view of the rate of growth, its quality, and how to finance it," he told a briefing on his department's latest scenario planning for Russia's economy through to 2010.
Klepach, the government's chief economic forecaster, put the size of the desirable deficit at 1.5-2.0 percent of gross domestic product.
The remarks highlight policy differences between the Economy Ministry, which advocates higher government spending to improve infrastructure and human capital, and the Finance Ministry, which is seeking to impose a tight limit on government borrowing and cut overall spending.
Deputy Economic Development Minister: Inflation in Russia will be higher than in developed states until 2030
Apr 13, 2012, ITAR-TASS
Inflation in Russia will be higher than in developed states until 2030, Deputy Economic Development Minister Andrei Klepach said on Friday presenting the long-term socioeconomic development forecast.
He explained the inflation with the outrunning growth of infrastructural companies’ tariffs and the anticipated weakening of the ruble exchange rate. In the period after 2020 the inflation will mostly relate to the higher cost of market services amid the general growth of salaries and incomes.
The growth of public utility charges will shrink by 1.5 times due to the lesser growth of energy prices, the broadening competitive environment and smaller operating costs alongside modernization of fixed assets.
Last year Russia reported an inflation of 6.1%, which was the lowest indicator since 1991.
Russia Ministry Sees Growth Of 5% Or Below Until 2030, Even With Reforms
MOSCOW, Dow Jones
Russia's oil-dependent economy won't grow more than 5% a year until 2030, even if the government's modernization plans are fully realized, the economy ministry said Friday.
In the best-case scenario, annual growth will likely be between 4% and 5%. A scenario that assumes lower oil price growth and a less successful modernization program put growth at 3.5%, the economy ministry said.
It called for Russia to run a long-term deficit of 1.5%-2% of gross domestic product and directing the funds toward economic growth.
A deficit is needed to "make a breakthrough in terms of the growth rate, its quality, and the sources for financing it," Deputy Economy Minister Andrei Klepach said.
The economy ministry last week trimmed its forecast for 2012 growth to 3.4% from 3.7%.