Russia’s budget spending will be below target in 2019

Federal budget spending is likely to undershoot the target by up to RUB1 trillion in 2019, the head of the Audit Chamber and former FinMin Kudrin said at a meeting with President Putin on Wednesday. The estimate is not new, but it is noteworthy that Kudrin confirmed it again despite the observed acceleration of budget spending in October and November. He noted that this would be a record and significantly worse than in 2018 when the shortfall was RUB770bn. The reasons are related to weak organization and preparation of various spending projects. This includes also the national projects, where Kudrin expects that RUB100-200bn will remain unspent. Yet, he noted that national projects are catching up lately and spending may become more rhythmical in 2020. Delayed budget spending this year has also been mentioned by the CBR as one of the main reasons for the faster-than-expected fall of inflation this year.

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