Russian Economy General News: #2

MOSCOW, Sept. 30 - RIA Novosti. Government of Russia will make the approval of the State Duma a draft federal budget for 2015 and the planning period of 2016 and 2017, with a planned deficit of 0.6% of GDP in three years.


The draft budget was imposed on the basis of macroeconomic forecast, involving the restoration of high growth rates in this three-year (GDP growth to 1.2% in 2015, and then to 3% in 2017). In 2014, the figure was 0.5%.


By the end of 2014, inflation is expected to reach 7.5% (against 6.5% in 2013). According to forecasts, this figure would drop to 5.5% by 2015. By 2017, inflation will be 4%.

Revenues, expenses, deficit

According to the document, the budget revenues in 2015 will amount to 15.082 trillion rubles (19.5% of GDP), expenses - 15,513 trillion (20% of GDP), the deficit - 430.7 billion.


2016 planned revenues 15,796 trillion rubles (19% of GDP), the cost of -16.272 trillion (19.6% of GDP), the deficit - 476.3 billion.


On the revenue side in 2017, it is expected that the budget will receive 16,548 trillion rubles (18.4% of GDP). Costs would amount to 17,089 trillion rubles deficit -540.9 billion (19% of GDP).


Fuel formed under the "fiscal rule", on the basis of which the base oil price of 96 dollars per barrel in 2015-2017. The price of Urals crude in the years 2015-2017 is projected at $ 100 per barrel. In 2014, oil was trading at $ 104.

Loans and advances from privatization

The budget deficit will be covered through government loans and privatization proceeds. For example, in 2015 the Ministry of Finance expects to attract the domestic market of more than 1 trillion rubles, and in 2016 and 2017 - 799.2 billion and 929.2 billion rubles, respectively.


Nevertheless, despite the geopolitical situation, Russia still plans to make external borrowing by $ 7 billion annually in 2015-2017.


If we talk about privatization, it is planned that the federal budget will receive 158.5 billion rubles in 2015, in 2016 - 99.9 billion rubles. As for 2017, that while the privatization program has not been approved, so the draft federal budget planned only 3 billion rubles.

Funds

According to the document, replenishment of the Reserve Fund will be for three years at a minimum. Thus, due to exchange rate differences the fund will grow slightly by the end of 2017 to 3.692 trillion rubles from 3.5 trillion at the end of 2014.


However, as noted by the Ministry of Finance, the Planning Period risks remain shortfalls in non-oil revenues, revenue from privatization, as well as risks related to borrowings. Therefore, according to the agency, the amount of the Reserve Fund may be reduced by the end of 2017 to 2.205 trillion rubles, if these fears are confirmed.
National Welfare Fund will increase to 3.334 trillion rubles by the end of 2017 with 3,189 trillion rubles at the end of 2014, according to a draft budget.

Large Chinese fund to invest in Russian zinc-lead deposit
Baikalruda, owned by Chinese mining company Baojin, has already invested around $100 million in the construction of an ore dressing plant



MOSCOW, June 06./ITAR-TASS/. New Horizon Capital, one of China’s largest private investment funds, may invest $ 200 million in Russia’s Noion-Tologoiskoye zinc and lead deposit near the lake Baikal, a source close to the negotiations said.
“The deal implies investments in the development of the Russian deposit with the participation of an experienced Chinese mining operator Baojin its branch is already investing in the project and the participation of a large international co-investor New Horizon Capital,” the source said.
Baikalruda, owned by Chinese mining company Baojin, has already invested around $100 million in the construction of an ore dressing plant located near the deposit.
The plant with an annual capacity of 500,000 tonnes of ore will be launched in 2014. The company plans to raise the capacity to 3 million tonnes per year, which requires $200 million in investment. The works will start in 2016.

http://en.itar-tass.com/economy/735054

sepheronx wrote:Oh for fucks sakes. If they wanted to drop it, they could do it now. And seriously, Russia will never return to its former glory of power if they need FDI and fucking handouts from foreigners to survive. India relies on itself with an FDI of $20B. Russia is looking pathetic right now. They have all the resources, major manufacturers, and they need foreing money to survive.

Russian Central Bank rejects capital controls as ruble hits lowest level since 1998



The ruble slid to a new record low of 39.71 against the dollar Tuesday. The Russian Central Bank has been quick to quash fears it would re-introduce capital controls to limit the amount of foreign currency purchases, or even moved outside the country.

“Bank of Russia is not considering the introduction of any restrictions on cross-border capital flows as it was reported in some publications in the mass-media,” the bank said in a statement on Tuesday evening.

The bank’s statement followed a report by Bloomberg News citing anonymous officials that the bank is considering imposing capital controls, as the ruble hit new historic lows.

The Central Bank said it would intervene once the euro-dollar currency basket against the ruble reached a level of 44.4, which it reached on Tuesday before quickly retreating.

Capital controls are a monetary tool by Russia’s key lender to restrict money flowing overseas, which in Russia is projected to reach $100 billion in 2014, nearly on par with the $120 billion that fled in 2008 when the financial crisis hit. In 2007 Russia had a positive net capital inflow.

Andrey Kostin, Chairman and CEO of VTB, doesn’t believe that Russia will impose capital controls just yet, talking to CNBC at VTB’s annual investment forum ‘Russia Calling!’.

“The basic issue now is whether the Russian leadership, under the circumstances, will switch to the model of a mobilization economy, and introduce the old mechanism of currency control, or they will stay on the principle of their open market economy. I think that is the big question that will be asked tomorrow,” Kostin said.

Russia repealed capital controls in 2006, however last week Central Bank Chairwoman Elvira Nabiullina said that Moscow would consider “non-standard” mechanisms to ensure economic stability.

Capital controls aren’t the only monetary tool the Central Bank could consider. If the ruble continues to weaken, it may decide to re-start currency interventions, pumping in billions of dollars to artificially prop up the currency. This would be a policy reversal for the bank, which has recently loosened its monetary controls in order to make the overvalued ruble free floating by 2015.

“Never say never, but not at this stage, definitely,” the VTB CEO said when asked if capital controls are on the horizon.

http://rt.com/business/192116-russia-central-bank-capital-controls/?utm_source=browser&utm_medium=aplication_chrome&utm_campaign=chrome

The representative of "highways" in September, told RIA Novosti that the Chinese companies are willing to engage and invest in the project of the order of 400 billion rubles.

Hannibal Barca wrote:Ruble will fall further.  Probably close to 50 rubles per dollar. Russia is a country with a huge trade surplus,a raw material provider and a need for a domestic industrial economy.
Makes sense.

- We share the principles WTO , "Unlike some "Founding fathers", it seems, of the organization. "


- The policy of openness of the economy remain unchanged.


- Responsible, balanced macroeconomic and fiscal policy. Said the budget surplus of 2% of GDP.


- The continued commitment of the budget rule.


- Recognized inflation. "With regard to inflation, then by the end of the year it will be about 7.5-7.6%, about 8%, which is actually higher than last year, when it was 6.5%," - said Putin. "The reason is understandable - in the growth of the prices of some food products. By the way, and you also know perfectly well it is an added incentive for us in the development of its agriculture "- the president said, noting that the monetary inflation does not exceed 5% of planned.


- Russia is increasing its use of national currencies in trade in energy, including with China. Use of national currencies - a serious mechanism to reduce risk, as well as new opportunities to the economic life. "Recently, the Russian company " Gazprom Neft "in China has implemented a trial supply of crude oil in rubles," - said the president.


- Did not increase the tax burden on business.


- Do not intend to impose exchange controls and restrictions on the movement of capital.


- The transition to a floating exchange rate does not mean the rejection of foreign exchange intervention.


- During 2015 will be a national system of payment cards. It must ensure the safety and reliability of operations.


- Repeats the thesis about the need for an industrial breakthrough.


- We will build project financing, including from external sources. Projects in industry and agriculture will have access to credit at lower rates. "I know now, many in the audience will say, where these lower rates? Where are the long-term money? I assure you, we are constantly thinking about the introduction of new instruments ", - Putin said


- We will assist in the capital increase business came under the unjust sanctions, especially financial.


- Confidence serious investors to Russia is not reduced. Russian Direct Investment Fund should be additionally capitalized to the planned level. In VEB will be allocated 30 billion rubles.


- Continue to improve the business climate in Russia. Noted that "It's not a place in the rankings," and the usability of the investor in the region. "I hope that during the spring and fall session The State Duma will take the rest of the package of bills in the national entrepreneurial initiatives to improve the business climate. Taking this opportunity, I ask Deputies promptly and constructively to consider them ", - Putin said.


- "We are working with businesses like real partners: no decision affecting the business environment is not taken without the participation of the business, leading business associations in Russia", - said Putin. Recalled the creation of a single federal portal of business checks.


"We are aggressively moving towards the goals that have set. I sincerely want to build a strong, prosperous, free and open to the world country "- summed up the president. Putin's speech at the forum was very brief - it was completed in 14.02, not last 20 minutes. Neither of Ukraine, nor the arrest of the owner AFK "Sistema" Vladimir Yevtushenko, Putin did not mention.


Putin answers

Putin, ready to answer questions from the participants of the forum, has joked that he is unlikely to be something to add to the performances and Ulyukaeva Nabyullina. President VTB Andrei Kostin said that "They argue, a key point puts the president." Putin said: "I just have to smile, perhaps, in some places, showing that it is not as difficult as it is painted, God forgive me, or frowning, showing that "Will not allow." "Let's try in this mode and work", - joked the president.


With regard to sanctions, it "Nonsense, of course, the full by those governments that limit their business." According to the president, the credibility of the major reserve currencies - the dollar and the euro - is reduced. It is in this invisible at first glance, the damage to the world economy


To the representative of the Swedish Investment Fund, which invests in the electricity, the mechanism of investment spurt and the fate of investment in power, Putin said that Russia welcomes and gives priority to private investment in infrastructure projects but the state should and will participate.


According to him, Russia is mindful of its obligations in the electricity industry, but   "We have to act carefully." "In my election articles and then decrees (2012) we were talking about, I said that we will deal with privatization, but how would the brackets I have learned the power companies. But now the situation is changing, and I'm not sure that we need to maintain this position. Moreover, we are now considering the possibility of entering the market with large blocks of our largest energy companies, which are under the control of the state. We find these decisions and I am sure we will move forward aggressively enough, "- said the president.


On the issue of guidelines for the development in modern conditions, Putin said that they remain unchanged. Noted that the task of doubling the GDP, the seemingly impossible is made. "We believe that the goals we leave unchanged", but we will look for new tools to achieve these goals or approach them. Including an improvement of the business climate, Putin said, and recalled government assets included in the privatization program.


- The objective of the Central Bank is the stability of the national currency. Without the fight against inflation is impossible.


- We are not increasing the reckless government spending . Sanctions - a temporary phenomenon, and a unique incentive for capital investments, including in agriculture .
- USA produces staple - dollars. We do not make dollars.


The representative UBS asked whether the policy shift towards Asia, Russia a serious and permanent. Putin said that Asia, particularly China, have become the driver of the world economy. "And Russia is also thinking about it."


Question about Ukraine from the representative of the investment fund of the United States: "What Russia wants to achieve?" Putin: Ukraine committed to the exit from the political and economic crisis. It should be predictable partner and neighbor. "The Ukrainian people have been and will remain the closest to us brotherly people", - said Putin. Hopes that the elections to the parliament will be worthy. We proceed from the fact that all the people of Ukraine will enjoy their rights without discrimination - "The only way to preserve the territorial integrity of the country."


Director Prosperity Capital Management Alexander Branis asked about   "Really Evtushenkova": whether to stir up the results of privatization. Putin: "There is no mass revision of privatization will not." However, law enforcement agencies may have questions, and we can not stop them. I am not going to interfere and give policy guidance, Putin said.


"Thank you very much for your interest, for an interesting conversation" - summed up the president.

The Chinese company, Hawtai Motor plans to build a Russian car assembly plant, which would cost $ 1.1 billion. , reports "Interfax" referring to the assistant to the president of the International Department Hawtai Jeffrey Zhang.

Iran will not export natural gas to Europe if Russia stops its exports, the country's President Hassan Rouhani said yesterday.

Viktor wrote:Iran is proving out to be a trustworthy ally and a rather sizable one too

and Russia is also making its own "coalition of the willing"

Rouhani: Iran will not replace Russian gas export to Europe

Iran will not export natural gas to Europe if Russia stops its exports, the country's President Hassan Rouhani said yesterday.

Viktor wrote:Nice  

Hawtai Motor plans to build a plant in Russia to assemble cars

The Chinese company, Hawtai Motor plans to build a Russian car assembly plant, which would cost $ 1.1 billion. , reports "Interfax" referring to the assistant to the president of the International Department Hawtai Jeffrey Zhang.

and another one !

Agriculture Ministry raised its forecast for grain production in 2014 to 104 million tonnes

and another good one ...

In the I half of Russia produced 183.8 tons of gold