Finance minister says Russia’s national debt will increase
Date
9/26/2024 8:17:17 AM
(MENAFN) Russia's state debt is set to rise slightly, reaching 18 percent of its gross domestic product (GDP) as the government seeks to address a growing budget deficit, according to the finance ministry's latest draft budget report. The ministry outlined plans for state borrowing, which is projected to hit 4.8 trillion rubles (USD51.5 billion) next year, increasing to 5.1 trillion rubles (USD54.9 billion) in 2026 and 5.3 trillion rubles (USD57 billion) in 2027. This increase will elevate public debt from 15 percent of GDP in 2023 to the anticipated 18 percent by the end of 2027.
The overall fiscal deficit is expected to stabilize at 1 percent of GDP annually, with slight improvements projected for the following years: -0.5 percent in 2025, -0.9 percent in 2026, and -1.1 percent in 2027. Despite this increase, the finance ministry has indicated that the national debt will remain within an "economically safe" threshold of under 20 percent of GDP, positioning Russia among the nations with the lowest levels of public debt globally.
In comparison, other countries face significantly higher debt levels, with the United Kingdom's national debt recently surpassing 100 percent of its annual economic output, the US exceeding 120 percent, and Japan's reaching a record 260 percent. Russian Finance Minister Anton Siluanov highlighted that the forthcoming budget prioritizes social support, defense spending, and technological advancements. Additionally, over 3 trillion rubles (USD32.3 billion) will be allocated annually to support regional development.
Economists have noted that the moderate growth of Russia's public debt is largely due to its relatively low budget deficit, as the nation continues to invest in significant projects and key industries despite facing extensive sanctions from the West. This strategy indicates a focus on maintaining economic stability while navigating external pressures.
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