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President Putin says Russia’s 2015 GDP drop stands at 3.8%, inflation hits 12.7%

January 11, 2016, 8:36 UTC+3 SOCHI

At the same time, according to Putin, Russia’s foreign trade surplus remained at the same level

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SOCHI, January 11. /TASS/. The Russian economy will gradually recover despite the drop of GDP at 3.8% over the last year, President Vladimir Putin said in an interview with German daily Bild.

"We believe that gradually we will reach the stabilization and the growth of the economy," Putin said.

According to the Russian president, "we are now facing the drop in GDP at 3.8%, the decline in industrial production at 3.3% and the inflation growth of up to 12.7%"

At the same time, according to Putin, Russia’s foreign trade surplus remained at the same level "and for the first time in many years we have increased the export volume of value added products."

"This is undoubtedly the positive trend in our domestic economy," the president said.

Putin also said that the Russian economy keeps maintaining a high level of reserves.

"The Central Bank currently boasts $340 billion in gold and currency reserves, I may be wrong, but the figure is definitely over $300 billion," he said. "Two state reserve funds have about $70-80 billion each - one $70 billion and the other $80 billion."

Early this year Russian Prime Minister Dmitry Medvedev signed a government resolution on the 2016 federal budget.

The document stipulated a common procedure for providing federal subsidies, grants and other purposeful inter-budgetary transfers to the budgets of Russian regions.

The government resolution also set common requirements for the procedure of providing federal budget subsidies to legal entities from among the producers of goods, works and services, as well as to government corporations and other entities.

Russia’s federal budget projected revenues of 13.738 trillion rubles (about $196 billion) and expenditures of 16.099 trillion rubles ($229.9 billion) with a budget deficit of 2.36 trillion rubles ($33.9 billion) or 3% of GDP.

The 2016 budget is based on the inflation rate of no more than 6.4% (December 2016 on December 2015). Russia’s GDP is projected at 78.673 trillion rubles ($1.12 trillion) in 2016.

Russia’s Reserve Fund established to cushion the budget against a plunge in oil prices is projected at the level of 5.5 trillion rubles ($78.7 billion) this year.

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