Fiscal rule already essentially in effect, might be formally introduced in 2018 – Belousov

Oil Well file photo

MOSCOW. April 17 (Interfax) – The new fiscal rule that restricts Russian budget spending of additional oil and gas revenue is essentially already in effect, and it might be formally introduced in 2018, Kremlin aide Andrei Belousov said.

“The fiscal rule comes down to cutting off the level of spending at an oil price of $40 per barrel. We negotiated on the exchange rate at which this will happen, whether it will be at the actual rate or at the rate that is factored into the budget law. It would seem a decision was made that it would be at the rate that is factored into the budget law. As things stand, there isn’t any particular debate right now around the fiscal rule,” Belousov told reporters on Monday.

“[The fiscal rule] is already essentially in effect,” he said. This does not refer to the Finance Ministry’s purchases of foreign currency on the market using additional oil and gas revenues that began in February, he added.

“This does not concern the Finance Ministry’s purchases, which have nothing to do with the fiscal rule,” Belousov said.

Asked when the fiscal rule will be introduced formally, he said: “Everyone is proceeding from the assumption that it needs to be introduced as quickly as possible.”

“In principle, yes [starting next year]. I think yes. But essentially, I repeat, it is already in effect today,” Belousov said.