Minister insists on structural reforms to accelerate GDP growth

5 April 2017

The Russian Ministry of Finance expects the economy to grow 1.5–2% in 2018, but growth will remain at 1.5% per year without any structural reforms, Vesti.Ekonomika reports citing Minister of Finance Anton Siluanov.

Such reforms include enhancing the mobility of labour resources, increasing labour productivity and reducing the shadow sector in the economy, the minister said. When preparing draft budgets, the Ministry of Finance takes into account that “there should not be any optimism in the forecast for the budget, but we would prefer not to be conservative either, so we always remain in the middle”, Siluanov said.

“Our economy has now adapted quickly to the new conditions. We have a stable balance of payments and it is sustainable with [oil] prices at USD 40–45 per barrel. The budget is stable. We are reducing dependency on oil prices. Whereas last year there was a balance at $60 per barrel, we have set the goal of ensuring a balanced budget in 2019 with prices at USD 40–45 per barrel”, Siluanov said.

As for creating conditions for a predictable economic policy, the Ministry of Finance is fulfilling the budget rule. “We take two-thirds of high oil prices through the budget. The so-called budget rule is currently in effect. We take two-thirds of oil and gas revenue from the economy and in doing so create stable conditions for price volatility on external markets”, Siluanov concluded.

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