Russia is creating a safety net
The oil price in the 2019 budget will be set at $41 per barrel. All funds received in excess of this figure will go to the National Welfare Fund.
Finance Minister Anton Siluanov announced this today in the State Duma of the Russian Federation, a PolitNavigator correspondent reports.
“You will say: well, today it’s 80, let’s soften the budget rule. But we don’t know how this indicator will behave in the future. Recently oil was at $30 a barrel. And then we cut costs. In our opinion, despite good market external indicators, we put part of oil and gas revenues into reserves, stabilizing the ruble exchange rate against currencies,” Siluanov said.
The minister believes that Russia must restore the lost reserves.
“We are a country that still depends on oil and gas revenues, and we must create a safety cushion for ourselves at the level of 7% of GDP. As soon as we exceed this figure, we will allocate money not for current expenses, but for development: infrastructure, projects,” the minister emphasized.
As of January 1, 2018, the volume of funds in the National Welfare Fund amounted to 3,8 trillion rubles. As Russian media reported, the Russian government plans to place them abroad.
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