Support The Moscow Times!

Russia Funnels More Billions Into its Sovereign Wealth Funds

The National Welfare Fund grew by 61 billion rubles, or 2 percent, over August to reach 3.15 billion rubles ($85.3 billion) on Sept. 1.

Russia's two oil revenue-funded sovereign wealth funds swelled by 353.3 billion rubles ($9.4 billion) last month to reach combined reserves of 6.54 trillion rubles ($177 billion), boosting the state's financial firepower as the West applies the economic screws on Russia over the Ukraine crisis.

Russia's Reserve Fund, which hoards U.S. dollars, euros and pounds sterling to insulate Russia against falling oil and gas prices, had assets worth 3.4 trillion ($91.7 billion) on Sept. 1, up 292 billion rubles, or 9.4 percent, from the start of August, according to the Finance Ministry.

The National Welfare Fund, which is designed to backstop Russia's pensions system and has a freer reign to invest in infrastructure and business, grew by 61 billion rubles, or 2 percent, over August to reach 3.15 billion rubles ($85.3 billion) on Sept. 1.

Both funds are financed from taxes on sales of oil and gas, and are meant to safeguard the long-term stability of an economy currently mired in difficulties. Though oil prices — the lynchpin of Russia's commodity-driven economy — remain high, Western sanctions on Russia over its policies in Ukraine have exacerbated a slowdown and pushed the country to the brink of recession in recent months.

However, the budget is still balanced and the Central Bank is sitting on reserves of nearly half a trillion dollars, an amount that includes the parts of the Reserve Fund and the National Welfare Fund held in foreign currency.

Sign up for our free weekly newsletter

Our weekly newsletter contains a hand-picked selection of news, features, analysis and more from The Moscow Times. You will receive it in your mailbox every Friday. Never miss the latest news from Russia. Preview
Subscribers agree to the Privacy Policy

A Message from The Moscow Times:

Dear readers,

We are facing unprecedented challenges. Russia's Prosecutor General's Office has designated The Moscow Times as an "undesirable" organization, criminalizing our work and putting our staff at risk of prosecution. This follows our earlier unjust labeling as a "foreign agent."

These actions are direct attempts to silence independent journalism in Russia. The authorities claim our work "discredits the decisions of the Russian leadership." We see things differently: we strive to provide accurate, unbiased reporting on Russia.

We, the journalists of The Moscow Times, refuse to be silenced. But to continue our work, we need your help.

Your support, no matter how small, makes a world of difference. If you can, please support us monthly starting from just $2. It's quick to set up, and every contribution makes a significant impact.

By supporting The Moscow Times, you're defending open, independent journalism in the face of repression. Thank you for standing with us.

Once
Monthly
Annual
Continue
paiment methods
Not ready to support today?
Remind me later.

Read more