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    Russian Finance Minister Forecasts Budget Deficit Below 3% of GDP in 2016

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    Russian Finance Minister said that federal budget deficit will average 2.8-2.9 percent of the country's GDP next year based on level-headed government decisions.

    MOSCOW (Sputnik) The Russian federal budget deficit will average 2.8-2.9 percent of the country's GDP next year based on level-headed government decisions, Russian Finance Minister Anton Siluanov said Wednesday.

    "Absolutely correct steps were taken not to rush with wage indexation and a range of social items, including civil servant and military personnel salaries," Siluanov said. "This contributed to the fact that we did not increase the compulsory part of the budget and were able to stop its expansion."

    On Tuesday, President Vladimir Putin signed a decree on next year’s budget with a $33 billion deficit, or 3 percent of Russia’s gross domestic product.

    "The [steps] affected the maneuverability of our budgetary resources and the fact that we kept the deficit within 3 percent. We estimate it will be 2.9 percent, perhaps 2.8 percent of GDP," Siluanov added.

    The one-year budget was adopted instead of the traditional three-year period due to high volatility in the financial and commodity markets.

    According to the adopted budget, the state is expected to take in some $195 billion in revenue, cap inflation at 6.4 percent, limit foreign debt by the start of 2017 and retain the average price of the Russian Urals benchmark at $50 per barrel.

    Under the 2016 budget, pensions will undergo mandatory indexation to increase by 4 percent and may be raised further to reflect the current economic and social environment.

    Related:

    Putin Adopts Russia’s 2016 Budget With 3% Deficit
    Russia’s Defense Spending to Total Over $50Bln in 2016 - Budget Draft
    Russian Budget Deficit in 2015-2016 Expected at 3% of GDP
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    GDP, budget, Anton Siluanov, Russia
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