CBR wishes to cut welfare spending

RUSSIA / FSU POLITICS - In Brief 18 Jun 2019 by Alex Teddy
Russian National Welfare Fund (NWF) is supposed to get to 7% of GDP by the end of 2019. Once it does the government can spend savings on other projects. NWF is worth USD 59 billion. It is projected to reach USD 129 billion by December this year. Earnings from oil over USD 41.6 per barrel go to the NWF. The CBR opposed this policy. Huge spending from NWF will raise inflation and the value of the RUB. This will reduce exports and raise hydrocarbon dependency. That is exactly what the government wants to avoid. The chairwoman of CBR Elvira Nabiullina is worried about inflation. Some want to stimulate the economy and some want to cut spending due to macroeconomic headwinds. The state has significant savings. People are crying out for these funds to be used to solve problems. The national projects need more cash.

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