PRESS: Russia recovers from Dutch disease – finance minister

MOSCOW, Jan 15 (PRIME) -- The most important achievement of the Russian economy in 2018 is its recovery from the Dutch disease, which occurs when windfall revenue from commodity exports drives the national currency’s rate too high hurting other industries, Finance Minister Anton Siluanov told Kommersant business daily in an interview published Tuesday.

“Our goal was to recover from a thing we used to call ‘the Dutch disease”. We did it with the help of budget instruments and rules. The pricing premium is withdrawn into reserves during the periods of high oil prices, and the money returns to the economy during the periods of low oil prices,” Siluanov said.

The ruble rate is becoming smoother, and households do not have to shift their savings between the ruble and the dollar at a loss.

Businesses now complain that the tax burden has increased because of higher non-tax payments, but the government sees no additional burden on law-abiding businesses, as the measures target the gray economy, he said.

“How could we not do it? The tax burden for law-abiding businesses is not growing. What is happening now is competition conditions becoming equal for all players. The fiscal component of the economy is not as important for us as the field of competition,” he said, adding that the government plans to fight the shadow economy with digitalization and new opportunities in administration of businesses.

“We are now doing everything to make working in the shadows unprofitable.”

He said that Russians didn’t take the most unpopular reform, the pension reform, lightly, but it was vital to improve the life quality of the retirees.

“I didn’t expect public discussion of the reform to be so difficult,” he said. “It is obvious that we have to raise pensions, but we are unable to find budget money for that without hurting other sectors, like healthcare, education, or the defense industry. The parameters of the pension system drafted at the beginning of the previous century had to be adjusted,” he said.

“All countries move in the direction of changes of retirement age criteria, ensuring the possibility of making lives of pensioners better.”

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