11 Sep 2023 13:27

Russia's budget structure stable for 2024-25; there will be no 'serious deficits' - Reshetnikov

VLADIVOSTOK. Sept 11 (Interfax) - The structure of Russia's federal budget is stable for 2024-2026; the projected rates of economic growth "will be good" this year and next year, respectively, thereby allowing to count on maintaining budgetary momentum; and the dynamics going forward will depend on restarting the investment cycle, Economic Development Minister Maxim Reshetnikov told reporters on the sidelines of the Eastern Economic Forum (EEF).

"It is important that with budget investments being the driver at the end of last year and at the beginning of this year, and the budget rather solidly supporting the economy through infrastructure projects, that there was primarily an increase in private investment in various sectors of the economy in the second quarter. This suggests that the economy is adapting and continuing to grow even under severe restrictions," Reshetnikov said.

"Everyone has been expecting large budget deficits in 2024-2025. Forming the budget is currently entering the final stage. We mostly do not see any serious deficits. The situation in the economy is developing well enough. Among other aspects, domestic demand has transformed into growth in non-oil and gas revenues, and the prime minister recently spoke about this," Reshetnikov said, commenting on the budget situation.

"Yes, we will most likely not be able to avoid a deficit entirely. We could imagine various scenarios, though this is more a matter of filling the National Wealth Fund and oil and gas revenues. However, the budget structure overall appears rather stable," Reshetnikov emphasized.

Reshetnikov also noted that budget momentum in the current structure does not have a one-time effect on the economy. Moreover, Reshetnikov said that budget expenditures are not always a one-time influx of money into the economy, because many contracts are subject to budget execution through the treasury, are in treasury accounts, and are transferred to enterprises only for completed work.

"We are proceeding from the fact that the rate of economic growth will be really good this year, and next year too, so the momentum will continue. However, the matter in 2025-2026 is precisely an issue of investment, the investment structure, and restarting the investment cycle. The figures that I have stated indicate that we are at the correct level," Reshetnikov said.