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Friday, December 9, 2016

In 2017, the state will run out of money to pay salaries


The Russian economy is in the middle of a storm. This was stated by first Deputy Finance Minister Tatyana Nesterenko, speaking at the forum “Territory meanings.” According to her, without reforms, the reserves will end by the end of 2017, while state employees remain without salaries. However, she immediately hastened to reassure the students: “If this is allowed. But we certainly do not tolerate, even in thought”. Will the Finance Ministry to seek sources of replenishment, “MK” asked the experts.

EXPERTS OF “MK”

Mikhail BELYAEV, chief economist of the Institute of stock market and management:

“Finally, the Ministry of Finance has put the question squarely. As noted by Tatiana Nesterenko, “if nothing changes, by the end of this year there will be no reserves nor the ability to pay public sector wages”. In other words, it is about the urgency of reforms in the Russian economy. We are now seeing a legitimate sad result of the economic policy pursued in the last decade. But what are the necessary reforms? If we talk about changes in the style of ex-Finance Minister Alexei Kudrin, who calls for institutional reforms and reforms of the judicial system, the improvement is not worth waiting. The main question — what tools at the moment for the country chooses the government and what it aims. The monetary unit of government chooses absolutely the wrong target at which to strike. Still in the forefront is fighting inflation and balancing the budget, and should be the development and stimulation of the domestic economy. This can be achieved through a policy of cheap money. In particular, the reduction of the key rate, which last Friday the Central Bank has kept the level of 10.5%. Now publicly declare the freedom of entrepreneurship, but in reality it is tightening the noose of high interest rates on loans.

Nikita ISAEV, the Director of the Institute of contemporary Economics:

“The statement of Tatyana Nesterenko is not an empty threat, but a real prospect that awaits us in the event of failure of any measures to find sources of financing of the budget. Now for all the sweat, the Reserve Fund, which for the first half of 2016 withdrew 33% of its reserves. So 2017 is a realistic estimate of when they will finally run out. But what is surprising — why the Deputy Minister just face the fact that it will be at idle, and does not offer measures to fill the budget and maintaining reserves? From the fact that people began to better understand when to begin more serious problem, money in the Treasury not increase. But resources for replenishment and fulfillment of all social obligations are now. Reform of public procurement, for which only the budget is spent 6.6 trillion rubles, excluding procurement by state-owned companies can give savings of up to 20%. Only this will allow to postpone the expenditure of the Reserve Fund more than six months. We have a huge amount of funds lying, without bringing real benefit to the country. For example, in us bonds invested $86 billion (almost 5.7 trillion rubles). The profitability of these investments is minimal use for economic development — virtually no. The Ministry of Finance should empty the horror stories go to real action with real proposals.”

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