Page 54 - RusRPTOct21

Meanwhile, Japan remained the largest holder of US debt in July for the 26th month in a row, increasing its investments from $30.5bn to $1 trillion 310.2bn.
China came in second, increasing its portfolio from $6.4bn to $1 trillion 68.3bn.
Britain is in third place ($539.5bn), Ireland is in fourth ($319.7bn), and Switzerland is fifth ($298.3bn).
The top ten largest holders of US government securities also included Luxembourg, the Cayman Islands,Brazil, Taiwan, and France.
In the new 2022-2024udget submitted to the Duma at the end of September, the Ministry of Finance has suggested increasing the share of the National Welfare Fund (NWF) available to be spent from 7% of GDP to 10% by 2024, VTB Capital reports on October 1.
“The government's federal budget draft is now public – and there are two key numbers worth highlighting: the new 10% red line for liquid NWF assets and the upper limit on NWF domestic allocation,” Alexander Isakov, chief economist at VTB Capital said in a note.
The proposal madey Presidential decree and MinFin's fiscal policy guidelines suggest increasing the red line for the NWF's liquid assets from 7% to 10% GDP 2024. Currently the NMF holds RUB14 trillion ($190bn) or a total of 12.1% of GDP, although the share of liquid funds is just under the 7% cut off line.
“The red line provides a floor for the domestic investment of the NWF, i.e. the Government can allocate the NWF into domestic investment projects as long as the level of remaining liquid NWF assets does not follow that line,” Isakov added.
According to the ministry’s projections the size of the liquid funds will reach 6.7% of GDPy the end of this year and 10.3% by the end of 2023. However, the increase in the NWF red line will be introduced gradually, according to the proposal. The RUB 2.5 trillion ($68.6bn) of domestic NWF investment for the next three years is essentially already ring-fenced and will not be influenced by the change, Isakov said.
“In our view, the increase of the NWF liquid asset allocation floor is a welcome development and adds a degree of certainty to the fiscal policy's stance over the next three years,” Isakov said in a note.
As part of the new budget the total cash value of money that will be invested from the NWF haseen increased to RUB2.5 trillion from the earlier limit of RUB1.6 trillion (four lots of RUB400bn invested each year between 2021 and 2024),ut VTBC speculate that the increase is made up of additional hard currency and import intensive project funding.
The analysts say that the new policy will support the RUB but locking up a larger share of reserves to shore up the budget in case of a fresh crisis and underscores once again Russia’s hyper-conservative policies to ensure
54 RUSSIA Country Report October 2021 www.intellinews.com