Russian Fiscal Aim Seen Out of Reach as Putin Spares Defense
- Government won't balance its budget before 2018, survey shows
- Crash in oil prices puts pressure on Russia's public finances
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Not even the prospect of leaving Russia’s budget in the red until 2018 will force reductions in social or defense spending, the two items that dominate government expenditure, a Bloomberg survey of economists showed.
Under the adjustments made public so far, the shortfall will exceed this year’s target of 3 percent of gross domestic product, according to 20 of 25 analysts in the poll, with only two predicting the government will run a balanced budget in 2017. A single respondent ranked cuts in social or defense expenditure among the three most important measures the authorities will take, while most economists predicted the government will primarily tap reserves to meet its needs in 2016.