Page 56 - RusRPTAug20

almost 30%. Defence expenditure rose by nearly 20% y/y, while other spending was up by 30%. The federal budget adopted for this year foresees an increase of expenditures by 8% from 2019. Actual spending in 1H20 was already more than half of the budget expenditure estimate for the year (the overwhelming majority of budget spending in Russia typically takes place in the latter half of the year).
If spending this year will be increased further to the degree suggested by prime minister Mikhail Mishustin early this month, the spending growth estimate this year rises to near 20%. President Putin, on the other hand, said this week that there was cause to stretch the timetable for national projects announced in spring 2018 from 2024 perhaps even into the next decade. This retreat on government spending on national projects only helps to a relatively limited extent in adjusting government spending. For example, the spending on national projects in the first half of this year corresponded to less than 8% of total federal budget spending.
The federal budget has gone from surplus to deficit. The 12-month deficit as of June was around 0.6–0.7% of GDP. Without the CBR’s Sberbank surplus transfer the deficit would have deepened to about 1.7% of GDP. During the remainder of 2020, the deficit will increase due to feeble revenue streams caused by low oil prices and economic contraction, and rising government expenditures.
56​ RUSSIA Country Report​ August 2020 ​ ​www.intellinews.com