Russia running out of reserves
The Russian Reserve Fund will be all spent in 2010 in order to cover for budget deficits, the country’s Finance Ministry confirms. In addition, the government considers to ask the World Bank and the International Monetary Fund for credits.
Russian Prime Minister Vladimir Putin has signed a decree according to which 1,36 trillion RUB of the country’s Reserve Fund will be spent on covering budget deficits.
By July 1, the fund had reserves of 2,96 trillion RUB (94,5 billion USD). With Putin’s 1,36 trillion withdrawal, the fund will see a serious cut. And that withdrawal will not be the last. The Russian Reserve Fund will in 2010 be all empty for funds, newspaper Kommersant reports.
Russian budget deficits will in 2009 amount to an estimated three trillion RUB, or 7,4 percent of GDP.
Not only the Reserve Fund will suffer in the time ahead. The government over the next couple of years also intends to spend about two trillion RUB from the National Welfare Fund.
In addition, Russia is likely to take credits from the international financial institutions World Bank and the International Monetary Fund. That was confirmed last week by Deputy Finance Minister Dmitry Pankin.
