Russia plans to increase budget expenditures by 26% in 2024
Russia plans to increase budget spending by 25.8% to RUB 36.6 trillion (US$383 billion) in 2024, with a substantial rise in military and social expenditures.
Source: Reuters
Details: The article points out that Russia will considerably redirect funds to the war against Ukraine. Moscow also plans to increase social spending just before the presidential election.
Russian Prime Minister Mikhail Mishustin claimed that the government expects to spend about 20.4% of the country's GDP next year.
"Russia's economy has proved more resilient to Western sanctions that most Russian and Western observers first thought, but is now grappling with persistent inflation - which, at an annual 5.45%, is above the central bank's 4% target - and double-digit interest rates," the report said.
Furthermore, Russia's Finance Minister Anton Siluanov said that the country would revert to the budget rule in 2024, assuming an oil price of US$60 per barrel.
Under its budgetary rule, Russia sells foreign currency from its National Wealth Fund (NWF) to compensate for any oil and gas export revenues shortfall or purchases in case of a surplus.
On top of that, Russia is also planning a significant increase in defence spending next year, surging to 6% of GDP from 3.9% in 2023 and 2.7% in 2021.
The Russian authorities expect the NWF to reach RUB 6.7 trillion by the end of 2024, down from 13.7 trillion rubles, or 9.1% of GDP as of 1 September.
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