Page 16 - RusRPTJul20

replenishment of reserves, if resumed, could turn out to be short-term and unstable.
How currency purchases can help fund this year’s spending
From March to early June, the Central Bank sold about $6.2bn in the interests of the Ministry of Finance under the budget rule, according to the Bank of Russia. Such sales should be made at the expense of previously acquired currency and only then - at the expense of the liquid resources of the NWF, follows from the rules of the Ministry of Finance.
As of June 1, the volume of liquid assets of the NWF amounted to almost $116bn, the Ministry of Finance said on June 8. In addition, the Ministry of Finance had about $10bn of currency in accounts with the Bank of Russia as of the beginning of March, which it will transfer to the NWF next year.
Accordingly, currency sales were carried out from these funds, and the NWF has not yet been used for these purposes (this is confirmed by the monthly statistics of the Ministry of Finance on the movement of the fund’s funds).
The potential resumption of currency purchases is important because in 2020 oil and gas excess profits can, as an exception, be directed not to the SWF, but to current budget expenditures. According to Kommersant, this option was discussed by officials in May. In fact, this will be tantamount to a temporary softening of the budget rule and will make it easier to finance this year's anti-crisis spending.
The Ministry of Finance refused to comment on the price at which currency purchases can begin, citing the monthly publication of upcoming sales / purchases of foreign currency at the beginning of each month.
2.9 ​ ​Government measures to help SMEs
Small and medium-sized enterprises (SMEs) are in the front line in the coronacrisis and the Russian government has introduced a number of measures to help them.
According to experts of the RANEPA and the Gaidar Institute, the wave of bankruptcies in the supply chain under the least favourable scenario can affect more than 67% of all companies and individual entrepreneurs, and their turnover in April - May 2020 could decrease by 77% compared to previous months.
The government and the president proposed measures to support SMEs:
- deferral of taxes and insurance contributions in the most affected sectors, exemption from their payment for the II quarter of 2020;
- reduction of insurance premiums from 30% to 15% if the employee's salary is higher than the minimum wage;
- subsidizing Russian banks to defer payment of loans;
- credit holidays to individual entrepreneurs whose income decreased by more than 30%;
- gratuitous financial assistance in April and May 2020 to the most affected sectors for wages;
- interest-free loans for emergency needs and payment of wages;
16​ RUSSIA Country Report​ July 2020 ​ ​www.intellinews.com