Russia’s January-April Budget Deficit Exceeds Targeted Amount for 2023

Russia’s budget deficit for the first four months of the year has exceeded the government’s entire 2023 target due to increased military expenditure and declining energy revenues, which have put a strain on the state budget.

According to the Finance Ministry’s published figures on Wednesday, the federal budget deficit reached 3.42 trillion rubles ($45 billion) from January to April 2023.

During this period, revenues experienced a 22% decrease, amounting to 7.8 trillion rubles, while spending saw a 26% increase, totaling 11.2 trillion rubles, compared to the same period in the previous year.

Russia had anticipated a budget deficit of 2.9 trillion rubles ($43 billion) for 2023, with at least one-third of state spending allocated to defense and security.

The Finance Ministry ceased publishing monthly budget figures last year; however, Reuters estimated April’s budget deficit to be around 1 trillion rubles ($13 billion).

From January to April, Russia witnessed a 52% decline in oil and gas revenues, reaching 2.3 trillion rubles ($30 billion). On the other hand, non-oil and gas revenues increased by 5% to 5.5 trillion rubles ($72 billion).

In 2022, Russia experienced a total budget deficit of 3.3 trillion rubles ($47 billion), equivalent to 2.3% of its GDP, making it the second-largest deficit in modern Russian history.

Government spending in 2022 reached 31.11 trillion rubles, surpassing pre-war predictions by over a third and exceeding the amount spent in 2021 by more than a quarter.

Last year’s budget deficit was only surpassed by the deficit recorded in 2020 during the peak of the coronavirus pandemic.

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