The Russian budget deficit increased to 5.2 trillion rubles, despite record oil prices.
The federal budget deficit widened again in late October, despite the rise in Russian oil prices to 12-year highs.
As the Ministry of Finance reported on Tuesday, in the months of January-October, treasury expenses were higher than income by 5.23 trillion rubles, or 2.3% of GDP. During the month, the "hole" in the treasury increased by 48 billion rubles, although in September and August the budget was in surplus.
Compared to the corresponding period last year, the budget deficit increased by a third, or 1.292 trillion rubles, and its current size is almost one and a half times higher than the original plan for the entire year (3.6 trillion). Oil and gas revenues, according to Ministry of Finance data, decreased by 14% over 9 months, while commissions from non-resource sectors in the economy increased by 19%.
The Kremlin's budget situation is worsening as the cost of the war rises, said Janice Kluge, an expert at the German Institute for International Security Studies. For the years 2022-2025, the Kremlin spent 47 trillion rubles on the production of the army and weapons - 26 annual budgets of the entire higher education system of the country.
The budget for this year included 12.9 trillion rubles for "national defense," but actual spending will total about 17 trillion, sources told Bloomberg.
The budget project of 2027 includes military expenditures of 17.1 trillion rubles, and for three years - 50 trillion. "The war remains the priority of Moscow's economic policy. And that threatens a further expansion of the deficit," says Eika Kurhonen, head of the Institute for Emerging Economies of the Central Bank of Finland.
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