«Priority»: Vladimir Putin urged to achieve growth in disposable income russiancomrade link
November 20, during a speech at the investment forum «Russia calling!» Vladimir Putin called on the government to increase the real disposable incomes of Russians. According to him, this option does not change, despite rising wages. At the same time, the President positively assessed the overall situation in the economy. He noted that the unemployment rate has hit the lowest levels in the history of modern Russia. The implementation of the national projects is beginning to lead to acceleration of GDP growth.
- RIA Novosti
- © Vladimir Astapkovich
Against the backdrop of increasing real wage growth, disposable income is practically non-existent. On Wednesday, November 20, said Vladimir Putin during his speech at the annual investment forum «VTB Capital» «Russia calls!».
«Today, wages in Russia are growing in nominal and in real terms, however, disposable incomes are almost standing still. Definitely need to change this situation. This is the most important direction of the government, and the results here are still quite modest,» — said the President.
From January to October 2019, the real disposable income of Russians (the income after paying all of the tax deductions) rose 0.2%. Such data leads Rosstat. Meanwhile the overall situation in the Russian economy remains positive, Putin said.
«Despite the slowdown in global growth, Russia remains a positive economic dynamics. Last year GDP growth was 2.3%. For the first three quarters of this year, it is modest — 1.1 percent. But the second half there was some acceleration of growth,» — said Putin.
As stated at the sidelines of the forum the first Deputy Prime Minister, Minister of Finance Anton Siluanov, in October, Russia’s economy grew by 2.2% in annual terms. The improvement in the dynamics of GDP growth, the Finance Minister explained the effect from the beginning of the implementation of national projects.
«We are constantly working on these goals — national projects. This work and business, and the regions and the Federal center. Now we see that there is already impact of these decisions, and the dynamics of growth of the economy starts to improve,» — said Siluanov.
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In 2019 of the Federal budget on realization of national projects should be spent more than 1.7 trillion rubles. According to Vladimir Putin, at the present time, the total volume of allocated funds disbursed 64%.
In 2020-2022 years, the implementation of the national projects will require a budget of almost 7 trillion roubles. As previously noted the head of state, the achievement of objectives should lead to acceleration in growth of Russia’s GDP to 3% in 2021.
One of the main achievements of the Russian economy during the last time Vladimir Putin has called a record fall in unemployment in the country. According to him, in the first nine months of 2019, the rate averaged 4.6 percent. As stressed by the head of state, the value was the lowest in the modern history of Russia.
In one of the sessions of the forum the head of the Ministry Maxim Oreshkin said that to improve the dynamics of the Russian economy it is necessary to increase the share of investment in GDP, improve the efficiency of public investments and economic activity of the population. The head of the accounts chamber Alexey Kudrin considers a priority the increase of labour productivity. According to him, the desired result can be achieved due to the growth in the share of investment in education is above 5% of GDP.
«The volume of government expenditure on education in Russia is approximately 3.7% of GDP. Innovation of the country show from 5 to 8% of GDP. So, if we do not change the proportion of how much we spend on the competence of a person to a new and diverse programs, if education becomes more innovative, it is unlikely that we will be able to carry out u-turns in labour productivity», — said Alexei Kudrin.
In the discussion of the prospects of the Russian economy, the forum participants were also given a forecast for growth of GDP in 2020. Assessment Kudrin, the rate may increase by 1,3—1,5%. At the same time, Maxim Oreshkin expects growth of 1.7%, and Anton Siluanov allow an achievement level of 2%.
Special attention of participants of the forum drew a sharp decrease in the level of inflation in Russia in recent months. So, after a slight acceleration at the beginning of the year growth of consumer prices in Russia has slowed down faster than the expectations of the authorities. According to the Ministry, in October, inflation in Russia fell below target by 4% to 3.7%. As expect in the Ministry, in November, the figure will be around 3.5—3.6% and in December will fall to 3-3. 3%.
«This year, we see that inflation will be closer to 3%. This is much below the expectations which were at the Central Bank and which we had,» — stated Maxim Oreshkin.
The slowdown in inflation, the Minister explained the reduction in aggregate demand in the economy by 1 trillion rubles. As noted by Alexei Kudrin, demand weakened due to the delay in the disbursement of budget funds. Against this background, Maxim Oreshkin called on the government and the Central Bank to take measures to support demand and bring inflation to the target level.
During his speech, Siluanov also said about necessity of acceleration of inflation to 4%. Meanwhile, as the Minister said, a sharp decline in the growth of consumer prices has a positive impact on the incomes of businesses and individuals.
«A sharp change in the inflation sentiment is not always a positive effect (on the economy. — RT), but low inflation is below the inflation tax, higher incomes of enterprises and population», — said the head of the Ministry of Finance.
Moreover, as previously noted in Central Bank, the emerging slowdown in inflation has become one of the main reasons for the active reduction of the key rate. In October, the Bank of Russia decreased for the fourth time in a row to 6.5%. The value was the lowest since the spring of 2014.
Recall rate reduction is needed to promote business activity and economic growth in General. So, in the long term, the actions of monetary authorities lead to cheaper loans, increase domestic demand and investment.