MOSCOW, August 5 (RIA Novosti) – Russia’s 2015 draft budget and the budget plan for 2016-2017 should be balanced to reflect Western sanctions imposed on Russia over Ukraine, the country's Prime Minister Dmitry Medvedev said Tuesday.
“This work should produce a realistic and balanced budget, a budget that takes into account the current state of affairs in the Russian and global economy, including the negative effect of the sanctions that are currently being imposed on certain companies and are de-facto against the whole country,” the prime minister said at a meeting to discuss Russia’s draft 2015 budget.
He added Russia will continue advancing its programs and projects of federal importance whatever the odds.
“Anyway, no matter what happens, there should be no doubt that we will continue moving forward and will implement programs and projects of national significance. And it’s an absolute and undisputable fact that all social responsibilities will be financed in full,” he said.
Medvedev emphasized that taxes may be raised as a last-ditch measure to replenish the budget.
“We need to analyze more variants of mobilizing the [budget] income, [to consider] all possible options, including raising taxes, although this measure should be taken only under a worst-case scenario,” he said.
The prime minister also described the existing opportunities for external funding and foreign investment as fairly weak.
“Obviously, we will have to be more active in replacing imports and boosting our own high-tech industry, including nuclear, space, rocket and other high-tech areas,” Medveved stressed.
On July 31, the European Council upheld the third tier of so-called “restrictive measures” against Moscow.
The third round of economic penalties limited Russian state-owned financial institutions' access to EU capital markets, imposed an embargo on trade in arms, established an export ban for dual-use goods for military end users, and curtailed Russian access to sensitive technologies, particularly in the oil sector.
Moscow has repeatedly said the measures are counterproductive, and warned they will hurt Europe no less than Russia.
