February 2, 2011
Russia’s budget deficit will be less than 3 percent of GDP in 2011 if oil prices exceed $75 per barrel, Finance Minister Alexei Kudrin said on Wednesday, citing Russian Finance Ministry forecasts.
“According to our prognosis, the federal budget deficit in 2011 will be 3.6% of GDP if the oil price stands at $75 per barrel. But given the trends on the global market, including those related to extra liquidity and political risks in a number of oil producing countries, the oil price will remain quite high this year, and Russia’s budget deficit will be less than 3 percent,” Kudrin said during an economic forum in Moscow.
Economic growth of more than 4% is possible in Russia if investment increases by 7-10% a year, Kudrin said.
He also said that Russia would continue cutting federal budget spending by 1% of GDP annually in 2011 and 2012. “This is our roadmap,” he said.
All Russian ministries and other state administrative institutions have been ordered to draw up plans to improve the effectiveness of budget spending in the next two years, Kudrin said.
“We will do it publicly, we will analyze the ministries and state administrative departments’ key spending points to achieve better results,” he said.
Kudrin also announced government plans to cut the number of all Russian ministerial and departmental officials by at least 5% in 2011, adding that the number of state officials is planned to be cut by 20% within the next three years.