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2017-2019 budget and facilitated reporting of the foreign exchange assets for state companies-exporters. The Russian government is establishing the priorities

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2017-2019 budget and facilitated reporting of the foreign exchange assets for state companies-exporters. The Russian government is establishing the priorities

2017-2019 budget and facilitated reporting of the foreign exchange assets for state companies-exporters. The Russian government is establishing the priorities
July 06
12:30 2016

Stabilizing and maintaining of the federal budget balance for the 2017-2019 years is a priority for the government, stated Dmitry Medvedev, Prime Minister of the Russian Federation.

“The stable balanced budget is a priority for the government for 2017, 2018 and 2019 years,” – Prime Minister informed when communicated with the members and supporters of the party “United Russia” in Yakutsk.

The head of the government said that “when the budget was stable, we would solve social and economic problems together.”

At the same time he stressed that the stability was needed not for the sake of stability but to reach new horizons for the development of the country.

“This applies to those programs that we are currently implementing. They include the development programs of the Far East, too” – stated Medvedev.

Prime Minister noted that the budget process for the coming year had already begun. The first meeting of the budget committee was held on Monday. The options of the approach to budgeting for 2017-2019 years were discussed then.

In his statement the head of the government said that the authorities had returned to the three-year budget cycle once again.

According to Medvedev, it allows building the state’s development plans for a three-year term.

“This is not a supernatural event, but it is important as understanding that we normally manage the socio-economic development and provide macroeconomic stability. And this allows us to solve the most complex social and economic problems”, – the head of the government said on this occasion.

Meanwhile, the Russian authorities are making advances to the state exporting companies, making the control regime for the level of foreign currency assets easier. The regime was introduced at the peak of the ruble devaluation in the late 2014.

Major exporters have the strategy. Usually, on the background of a sharp collapse of the national currency they prefer to “keep” the proceeds in foreign currency. This tactic is among the reasons for the ruble collapse in December the year before. Then the directive was issued, which dictated the representatives of the interests of the Russian Federation on the boards of directors of “Gazprom”, “Rosneft”, “ALROSA”, “Zarubezhneft” and PO “Kristall” to give voices to entrust the executives to make the size of the net foreign exchange assets not higher than the index as of 1 October, 2014. This should be done before 1March 2015. The executives must subsequently maintain the size of the company’s net foreign currency assets not higher than the specified level.” At the same time the country’s leadership has obliged the companies to submit a report on the amount of net foreign exchange assets to the Central Bank every week.

On Wednesday “Rosneft” made the announcement of the consideration of the changes to the decision of the Council of 22 December 2014 on the issue “About the level of net foreign currency assets”. This consideration was made by the company’s Board of Directors. The press-service of the company explained that the ” the calculation methodology of net foreign exchange assets had changed as a result of the joint work of the company and the Bank of Russia, aimed at a better definition of the financial statements.”

The Bank of Russia made a proposal to update the terms of the information provision by the exporting companies. The ministries have prepared a draft directive and sent it to the government in June, a source in one of the specialized agencies told to “Interfax”. Now the company will be able to make a report for the regulator every quarter, but not every week, the source told to the agency.

The central bank declined to comment. The representative of the Central Bank said that the issue was in the competence of the government.

During the last year the head of the Central Bank Elvira Nabiullina repeatedly stated that exporters sold currency proceeds evenly and stably, and there was no any reason to introduce additional sanctions for them.

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