Page 48 - RusRPTFeb22

6.1.1 Budget dynamics - results
Russia’s federal budget ended 2021 with a RUB0.5tn, 0.4% GDP surplus
for 2021 thanks to high commodity prices and prudent spending by the state.
Infrastructural outlays surged in December, to a large extent reflecting the catching up spending on infrastructure and the prefunding of infrastructural projects, supported also by the December appropriations adjustment funded by extra nonO&G proceeds, disbursed during the same period.
This year VTB Capital (VTBC) expects extra nonO&G proceeds will more likely be used to increase spending rather than to cut borrowings. This is in line with Ministry of Economy's initiative to channel extra nonO&G proceeds to the government's reserve fund to be disbursed later for additional spending items.
Fiscal support is shifting from consumption to capital. In November-December, infrastructure saw the largest funding boost, while previously additional nonO&G proceeds tended to benefit social spending.
The fiscal stance is turning disinflationary also due to infrastructure spending being associated with a lesser fiscal multiplier, resulting in more subdued secondary effects.
This year's GDP growth is likely to be underpinned by investment (and exports), with less support from consumption, as the fiscal impulse from social spending has already turned negative and the retail credit impulse is waning.
6.1.4 Budget dynamics - National Projects
The government has still not published the updated the 12 national projects, nor the National Goals Strategy that supersedes it.
The latest announcement was a decree issued February 3, allocating responsibility for a Strategy of Socio-economic Development to 2030. This will preserve the National Projects in the period to 2024, but also build a longer-term growth strategy through to 2030. There will be five main operational centres within the government as follows, with the responsible Deputy Prime Minister in brackets:
New high-technology economy (First Deputy PM Belousov) Aggressive infrastructure development (Deputy PM Khusnullin) New Social contract (Deputy PM Golikova)
48 RUSSIA Country Report February 2022 www.intellinews.com