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Monday, October 24, 2016

Kudrin warned of the imminent exhaustion of reserves without structural reforms

Former Finance Minister Alexei Kudrin, who now heads the Committee of civil initiatives, told Interfax on its programme of economic development of the country, which he presented to the President. It is an alternative to another set of measures, the so-called “growth Strategy” developed by the Stolypin club.

photo: Alexander Astafyev

The differences between the two programs lies primarily in the fact that Kudrin proposes to conduct in the state of a number of political reforms, while the “growth Strategy” focuses exclusively on the economy. Thus Kudrin speaks very carefully about what the political institutions of the country must be raised: according to him, we are talking about “the powers of the various authorities, it (the program — ed.) will affect the judicial and law enforcement, civil society”.

Went Kudrin default and the question of whether he expects that the program will form the basis of the President’s policy of Vladimir Putin for the elections in 2018, as in his time happened with the reforms Herman Gref. Kudrin has limited itself to stating that “all decisions are decisions of the President.”

Read about alternativnoi Kudrin “Stolypin” programme.

However, the ex-the Minister has explained why the authorities need to take a closer look at a program developed under his leadership, otherwise, he says, reserves will be exhausted in the next two to three years, and it will happen subject to active privatization or government borrowing, or the money runs out even faster.

Does not see Kudrin without reforms and opportunities for profitable growth in the near future Russia will face although positive dynamics of GDP, but within it zero to one and a half percent.

With the orientation of Central Bank policy Kudrin believes is right: he stressed that the current exchange rate meets the requirements of the economy, and further reduce it should not be. We will remind that earlier the adviser of the President of the Russian Federation Andrey Belousov warned of the possibility of undesirable strengthening of the ruble, and Putin himself collected in connection with this government meeting.

However, according to Kudrin, the rouble should remain floating, as it provides stability for the economy. In addition, he endorsed a gradual decline rate of the Central Bank. Note that this position is not in agreement with a number of other economists, in particular — the former Chairman of the Central Bank Sergei Aleksashenko, confident that the rate could be reduced to the present moment by a few percent.

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