The government has no room to raise spending, Finance Minister Anton Siluanov said Wednesday, stoking a debate over whether fiscal stimulus should be deployed to revive flagging economic growth.
Siluanov, who has championed Russia’s new “fiscal rule” to curb spending and borrowing, spoke just hours before talks with President Vladimir Putin on possible measures to boost growth after it slowed to 1 percent in the first quarter.
A split over how to tackle flagging growth has widened in Putin’s government, with the Economic Development Ministry pressing for more stimulus to stop the country from sliding into recession, something that seemed impossible just a year ago.
“We see risks in the economy,” Siluanov told reporters. “It would be premature to say that there are additional [spending] possibilities this year … and in 2014-15.”
When Putin returned to the presidency last May, he called for a “new economy,” including increased investment and a shake up in state-run industries. Instead, Russia’s $2.1 trillion economy is close to stagnating.
Economic Development Minister Andrei Belousov said earlier that he would present his plan to stimulate growth to Putin later on Wednesday, including putting the Central Bank in charge of growth rather than just monitoring inflation levels.
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.
Remind me later.