Budgeting and Governance Goals

I was hoping more of this discussion would be published, but alas only Putin’s introductory remarks are available before the report by Finance Minister Siluanov. The reason why this short report is important is due to the mass of propaganda being published about the state of Russia’s economy that’s always predicted to be on its last legs due to sanctions pressure and the lack of trading partners. The last three major events and subsequent reports about Russia’s economy I posted were “The Presentation of Results & Meeting on Development of Russia's Far East,” “Ninth Eastern Economic Forum Plenary Session”, and “Another Putin Meeting With Government.” The first two set forth goals and the last talks about results. For the grandiose plan/vision described to Russia’s government, we need to refer to “Leap Day: Putin's Address to the Federal Assembly” that’s far more technical than what Putin said in Vladivostok. And then there are another dozen if not more reports before and after the Leap Day Speech, known in subsequent conversations with the government as the Address. Numerous references are made to budgeting and financing and investments, but rarely do we get to see how that is actually made to arise, to become more than text in a speech. I’ve been a hawk on Russian development for almost five years now but have yet to come across a dedicated meeting to determining the budget, although such meetings are discussed and referred to. The finished documents can be found both prior to and after Duma discussion and voting on them. And then there’s the difference in timelines between how Russia forecasts and how the one other economy I’m most familiar with does its forecasting—the Outlaw US Empire. There currently exist Russian projections/goals for 2035, 2030, 2027, 2026, and 2025, as well as a few that go beyond that to 2040 that are mostly related to Russia’s Space Program. As I’ve said before, Russians are planners. What you’ll read is a short introduction to part of that process—budget planning:

Vladimir Putin: Dear colleagues, good afternoon!

We continue to work on the draft federal budget for the coming year, 2025 and the planning period 2026-2027. We discuss the emphasis of the main financial document of the country, the tasks that the budget faces, and, of course, the macroeconomic conditions in which these tasks will have to be solved.

We have already discussed the main directions of economic policy until 2030, our system solutions and measures to strengthen the country's industrial, logistics, and financial capabilities, which directly affect the state of the budget, its formation and execution.

I suggest that we devote today's meeting to concrete, practical steps to fill in the draft federal budget, including discussing its key revenue and expenditure items.

As in the previous three years, public spending priorities should continue to include social support for citizens, strengthening the country's defense capability, integrating the regions of Donbass and Novorossiya, as well as technological development of the domestic economy and social sphere, expanding and strengthening infrastructure, updating cities and towns, and improving the quality of life of citizens.

I would like to emphasize that new national projects will be launched starting next year in order to achieve noticeable, positive changes in all spheres of life and ensure Russia's long-term and progressive development.

For their successful implementation, it is necessary to provide financial resources and allocate them to the federal budget in the required amount.

Among other things, strategic decisions on additional adjustment of the tax system should work here. They are designed to make it fairer and more efficient. These changes will also take effect next year.

I would like to add that in order to achieve the national development goals confidently and consistently, it is important to maintain a responsible budget policy and guarantee the stability and balance of not only the federal budget, but also the entire public finance system, both for the next three years and for the longer term.

I suggest that we discuss all these issues in detail and work together today.

Let’s start. A word to Anton Germanovich Siluanov. You are welcome. [My Emphasis]

No worries about the deficit since Russia doesn’t have one, just straight-forward, let’s get down to business, attitude. I searched Russian media for any reports about this meeting which I’d expect since budget battles are always news here but found nothing. It’s possible the terrorist event in Lebanon shoved reporting on this meeting aside, plus it was a rather active news day, and this was just a preliminary planning meeting that will set the stage for several more to follow before the process shifts to the Duma.

As far as the 2025 outlook for Russia’s economy, I expect it to grow at the 4-5% clip it is now given the great synergy happening with the Global Majority. If a new international financial and trading system is announced at Kazan in October, I don’t expect it to help or hinder Russia’s economy. IMO, what will help is the establishment of a BRICS Commodity Exchange where pricing will be done in currencies other than the dollar, yen and euro. Growth of other near abroad economies will also boost Russia’s, which is part of the synergy mentioned above. And some European attitudes are changing as their economies continue to dive as a result of cutting trade relations with Russia. The Winter will again bear watching as the first snows arrived in Siberia yesterday.

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