Putin: Economic growth not goal itself, people’s income important

MOSCOW, Sep 25 (PRIME) -- Economic growth is not a goal itself, higher income of Russians is more important, President Vladimir Putin told the government on Wednesday.

“Economic growth is not an end in itself. Its result is more important, and it is higher income of the people,” he said.

He added that wages of some state employees will be adjusted by 4.3% from October 1, the minimal wage will rise 7.5% to 12,130 rubles from January 1, 2020, and the number of families receiving payments for the first two children will increase to 68% from 45.7% as well.

Putin also asked the government not to “bombard” Russia’s industries with money, which may cause inflation, but to spend state funds effectively.

The mission to raise investment growth to 5% by 2020 is a difficult and ambitious task, the president also said.

Economic Development Minister Maxim Oreshkin said that it is a hard task to raise investment activity in Russia without increasing entrepreneurs’ trust in the court system.

“Polls have demonstrated a negative trend (in entrepreneurs’ confidence) over the past few years. If the trend does not reverse, it will be very difficult to get a positive investment activity result,” he said.

Russia’s economic growth is seen speeding up to 1.6–1.7% at the beginning of the third quarter, but may slow down later, Oreshkin also said.

Inflation is decelerating faster than expected and may end up 3.6% in 2019, and amount to 3% in January–March 2020, the minister added.

Putin said that the slowdown in inflation is linked to underperformance in implementation of national projects.

“We know that the ‘overhang’ is a result of not very vigorous implementation of national projects. The central bank has adjusted the macroeconomic figures as awaits the 700 billion (rubles). The result is lower-than-expected inflation,” he said.

In 2018, Putin signed a decree on Russia’s national goals and strategic development tasks till 2024 in which he ordered the government to ensure the country’s entry into the top five of global economies, a higher than global rise of the national economy, and inflation not exceeding 4%.

(63.7060 rubles – U.S. $1)

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