Ministry of Finance of the Russian Federation
Ministry of Finance of the Russian Federation
21.06.2011

Statements of Deputy Head of the Government of the Russian Federation – Finance Minister of the Russian Federation A. Kudrin

 

Belarus receives first $800 mln tranche from EurAsEC anti-crisis fund

MOSCOW, June 21(RIA Novosti). The Eurasian Economic Community (EurAsEC) has transferred the first $800 million tranche of an emergency loan to Belarus to stabilize its finances, Russian Finance Minister Alexei Kudrin said on Tuesday.

"Belarus yesterday complied with all formal requirements and today the money has already been transferred," Kudrin said.

EurAsEC, a post-Soviet economic bloc led by Russia approved a $3 billion bailout loan early in June for the ex-Soviet republic struggling to keep its economy afloat.

The Belarusian ruble came under pressure in the first five months of the year from a large trade deficit, generous wage increases and loans granted by the government ahead of the December 2010 presidential elections, which spurred strong demand for foreign currency.

In spring, the country's authorities devaluated the national currency by 36 percent in one day, froze prices on some staple foods and introduced a fuel rationing to keep the lid on a deepening financial crisis.

The Belarusian government has applied for loans from Russia and EurAsEC. Russia said it would support loan disbursement to Belarus via EurAsEC.

The Belarusian authorities also said the country intends to raise up to $8 billion from the International Monetary Fund.

 

Kudrin says first $800 tranche of EurAsEC loan transferred to Belarus

MOSCOW, June 21 (Prime-Tass) -- The first U.S. $800 million tranche of the EurAsEC Bailout Fund loan has been transferred to Belarus today, Russian Deputy Prime Minister and Finance Minister Alexei Kudrin has told reporters.

Belarus has met all the formal commitments. “The money has been sent today,” Kudrin said.

The lending terms approved on June 4 have been unchanged. “However, we are concerned over the statements of Belarusian officials about free prices, free trade in the Customs Union. There are no restrictions yet, but we are concerned,” Kudrin said. End

 

Kudrin: First Tranche Of Belarus Loan Wired Tuesday

MOSCOW (Dow Jones)--A Russian-led bailout fund has wired the $800 million first tranche of a $3 billion loan to Belarus, Russian Finance minister Alexei Kudrin said Tuesday.

Minsk hopes to use the funds--which will be spread out over three years--to help stabilize its currency and plug a gaping trade deficit. The country has also turned to the International Monetary Fund for a loan of up to $8 billion and hopes to raise some $7.5 billion through privatizations.

Belarus devalued its ruble by 36% in May 2011.

 

EurAsEC transfers 1st loan tranche to Belarus

RBC, 21.06.2011, Moscow.The first tranche of a loan from the anti-crisis fund of the Eurasian Economic Community (EurAsEC) worth $800m was allocated to Belarus today, Deputy Prime Minister and Finance Minister Alexei Kudrin told journalists today.

"Belarus performed all formal obligations yesterday, and the money was transferred today," Kudrin said. He reiterated that the terms of the loan from EurAsEC's anti-crisis fund were approved on June 4, 2011 in Kiev.The loan agreement between Belarus and EurAsEC was signed on June 9 in Minsk. The document provides for a total loan amount of $3bn, to be transferred in tranches over a period of three years. The loan carries a 10-year term. As Kudrin announced earlier, one of the conditions for the extension of the loan was the privatization of Belarusian assets worth $7.5bn.

 

Credit of 800 M dollars transferred to Belarus on Tuesday - Kudrin.

MOSCOW, June 21 (Itar-Tass) — The credit to Belarus of 800 million dollars was transferred on Tuesday, Russia’s Deputy Prime Minister and Finance Minister Alexei Kudrin told reporters.

“Last night the Belarussian side accomplished all formal obligations, and today the money is on its way already, it was transferred from Almaty,” he said.

The credit is 800 million dollars, and its terms are approved by the EurAsEC Anti-Crisis Fund on June 4 and will be fulfilled fully, he said.

“We are a bit concerned about the statement from the Belarussian side about free prices in the Customs Union,” Kudrin continued. “As yet, there are no limitations /from the Belarussian side/, we only express our concern.”

 

Deputy PM: Increase in budget expenses should be limited

RBC, 21.06.2011, Moscow. Expenses of the Russian federal budget cannot go up by more than 4% annually in real terms, Deputy Prime Minister and Finance Minister Alexei Kudrin told journalists today.He emphasized that the Russian ministries and government bodies proposed hiking budget expenses "by dozens of percent" within the next three years. According to finance minister, however, there is no single method that would allow the government to incorporate all proposals of the ministries and government bodies. Kudrin went on to note that Russia should attract private investments instead of building up expenses by financing whole economy sectors.

 

Budget expenses should be under 4pct – finance ministry.

MOSCOW, June 21 (Itar-Tass) —— Russia’s Finance Ministry considers that budget expenses should not exceed four percent net, Russia’s Deputy Prime Minister and Finance Minister Alexei Kudrin told reporters on Tuesday.

Kudrin added that the major objective is “non-increase of expenses, as we believe that a rise of expenses should not be above the economy growth, which is four percent net.”

During the first meeting of the Finance Ministry’s Civil Council on Tuesday, experts discussed cutting state expenses, the Council’s Chairman elect Sergei Sinelnikov-Murylev, who is Head of the All-Russian Academy of Foreign Trade, said.

“Up to 2020, there is a threat of raised expenses to 29-30 percent of the GDP,” he said. “This figure is insane, nothing of the kind has ever been in Russia’s history, and at the same time the budget deficit may become unprecedented – ten percent of the GDP.”

In a situation like that it would be necessary “either to lower expenses or to raise taxes.”

“Experts do not claim this is what will happen,” Kudrin said commenting on the views of experts and confirmed that “it is important to focus on development of private investments, privatisation, lower state involvement in the economy” to avoid paternalistic scenario.

Kudrin commented approvingly on the idea, which Russia’s President Dmitry Medvedev expressed at the St. Petersburg economic forum, regarding de-centralisation of taxes and authorities.

“This is a correct strategic objective, as it refers to system restructuring, not to some taxes or authorities,” Kudrin said.

He forecasted the ministry would need al least a year to prepare suggestions.

Taxation policies’ changes will depend on the scale of responsibilities’ restructuring, he said adding that “during next three years taxation structure will not be changed much.”

 

Kudrin makes no comment on his possible involvement in Right Cause party.

MOSCOW, June 21 (Itar-Tass) —— Russian Vice-Premier, Finance Minister Alexei Kudrin makes no comment on his possible involvement in the Right Cause party.

“This is a serious question, and I will not give an answer right now,” he said in reply to an Itar-Tass question why he was unwilling to head the Right Cause.

President Dmitry Medvedev said in an interview with the Financial Times that Kudrin would make a perfect leader of a right-wing party.

The party was formed in November 2009 and led by cochairmen but the question of a single leader was raised many times. The right-wingers wished high-ranking federal officials to become their leaders, such as Kudrin, Presidential Aide Arkady Dvorkovich and First Vice-Premier Igor Shuvalov. It was reported in May that Onexim Group leader Mikhail Prokhorov could become the party chairman. The candidature may be approved at a party congress on June 25.

 

Russia 2011 Budget Deficit Below 0.5% If Oil Averages $115/Bbl - Kudrin

MOSCOW (Dow Jones)--Russia's budget deficit this year is expected to be below 0.5% of gross domestic product if crude oil prices average $115 a barrel, Finance Minister Alexei Kudrin said Tuesday.

The forecast is slightly higher than one given by Kudrin earlier this year, when he said an average oil price of $115 a barrel was enough to completely balance the country's 2011 budget.

An average oil price of $105 a barrel this year would result in a budget deficit of 1% to 1.5% of GDP, Kudrin said.

Kudrin, known as a fiscal hawk, also said that budget spending should not grow by more than 4% a year.

"Budget spending growth should be limited by the growth of the economy, to no more than 4%,"

said Kudrin, adding that current proposals to increase spending amount to much more than that.

 

RF budget deficit may be under half percent 2011 - Kudrin.

MOSCOW, June 21 (Itar-Tass) — Russia’s budget deficit may make less than 0.5 percent, Deputy Prime Minister and finance Minister Alexei Kudrin said on Tuesday.

“At the oil price of 105 dollars a barrel, the budget deficit in 2011 will make from one to 1.4 percent of the GDP,” he said. “If the annual average oil price is 115 dollars a barrel, the budget deficit may be under 0.5 percent.”

While calculating the 2012 budget deficit, the finance ministry uses the oil price of 93 dollars a barrel, he explained.

“The final deficit rate will be within three percent,” he said.

Kudrin added that the major objective is “non-increase of expenses, as we believe that raise of expenses should not be above the economy growth, which is four percent net.”

 

Finance Ministry’s civil council starts working.

MOSCOW, June 21 (Itar-Tass) —— Russia’s Finance Ministry’s civil council started working on Tuesday.

“Unlike other discussion bodies, the Civil Council will unite exclusively independent experts, and officials will not be its members,” Finance Minister Alexei Kudrin told the first meeting of the new entity.

The council “should not be exclusively a mere supporter of all civil organisations,” he said. “We expect professional dialogue.”

He named key objectives of the council, highlighting “organisation of public discussions of the Finance Ministry’s initiatives” and explained that it will prepare suggestions on budget, taxation, customs and tariff policies.

“Despite the fact that the council’s decisions will be of recommendation character, I shall see to it that its most recommendations are implemented,” Kudrin said.

Today’s meeting will elect a chair person, and one of candidates is head of the All-Russian Academy of Foreign Trade Sergei Sinelnikov-Murylev. The council unites 27 experts. Kudrin said that the council will have regular meetings, about one a quarter.