Russia planning net borrowing of 2.08 trln rubles in 2014-2016
MOSCOW. July 3 (Interfax) - Russia's Finance Ministry is planning net borrowing on the domestic and international financial markets of 691.7 billion rubles in 2014, 550.3 billion rubles in 2015 and 836.9 billion rubles in 2016, according to the budget policy guidelines for 2014-2016, a copy of which has been obtained by Interfax.
Despite the growth of government borrowing, the debt burden will remain within limits that will make it possible to fully meet debt obligations, the document states.
Russia's sovereign debt is expected to total 9.470 trillion rubles or 12.8% of GDP in 2014, 10.798 trillion rubles or 13.2% in 2015 and 11.665 trillion rubles or 12.8% of GDP in 2016.
The domestic government debt is expected to total 7.180 trillion rubles in 2014, 8.052 trillion rubles in 2015 and 8.716 trillion rubles in 2016, while the foreign debt is expected to be respectively 2.290 trillion rubles, 2.745 trillion rubles and 2.949 trillion rubles.
In determining the ratio between domestic and foreign borrowing, priority will be given to domestic borrowing, the document states. The main borrowing instrument in the next three years will be OFZ federal bonds. Priority will be given to medium and long-term bonds. Bonds with duration of up to one year will be placed only in the event of an extremely unfavorable market situation.
In order to expand the investor base for OFZ, the government will consider issuing bonds that provide protection from inflation. The Finance Ministry's target duration for the OFZ portfolio is five years.
The ministry will also continue to issue GSO government savings bonds for institutional investors.
There are plans to borrow about $523 million from international development banks in the next three years.
Within the context of debt policy, the Finance Ministry also plans to allocate 150 billion rubles for compensation payments on pre-reform deposits.