MOSCOW, September 20. /TASS/. Russia’s budget deficit is forecast to be 3.9% of GDP in 2016 and 2.8% of GDP in the next year, Fitch international rating agency said on Tuesday.
Budget plans of the Russian government will be an important topic for assessment of Russia’s credit rating after parliamentary elections held on September 18, Fitch said. "The vote sets the stage for the reintroduction of a medium-term fiscal framework and formal fiscal rule that should detail how the government plans to balance the budget," the rating agency said.
"We think significant fiscal savings are achievable, although some measures, such as further pension and social payment reforms, lower subsidies and higher income taxes, would have social costs. Discussions about a new budget rule, which would save oil revenue when prices are above a certain level, may also resume," the international rating agency said.
The government will try to maintain Russia’s budget deficit at 3.3% of GDP, Minister of Economic Development Alexey Ulyukayev said early in September.
Russia’s continued commitment to contain expenditure and implementation of a credible medium-term fiscal framework could result in upgrade of its credit rating, the rating agency said on Tuesday.
"The risk to Russia's 'BBB-'/Negative sovereign rating has shifted from external finances towards public finances," Fitch said in a statement.
Continued commitment to contain expenditure and implementation of a credible medium-term fiscal framework could result in positive rating action.
Failure to recover from recession coupled with significant deviation from stated macroeconomic and fiscal policy aims would be negative for Russia, the international rating agency reported.
Fitch scheduled the revision of the sovereign credit rating of Russia on October 14.