Regional Budgets in 2022

Alexander N. Deryugin – Acting Head of Department for Budget Policy of the Gaidar Institute for Economic Policy; Senior Researcher of the Russian Presidential Academy of National Economy and Public Administration (Moscow, Russia). Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

The year 2022 was a critical one in terms of the dynamics of tax and non-tax revenues of the consolidated regional budgets: while in the first half of the year it looked quite satisfactory and the growth of budget revenues significantly outpaced the inflation rate, by the end of the year the growth halted and the decline of profit tax revenues, exacerbated by its partial refunds to taxpayers, significantly raised the risk of formation of negative budget revenues in some regions in some months. In 2023, without additional financial assistance from the federal budget, the budgets of the overwhelming majority of regions will be unbalanced, which may lead to an increase in the total volume of regional debt and the amount of debt burden.

Key words: regions’ budgets, revenues of regional budgets, expenditures of regional budgets, intergovernmental fiscal transfers, regional debt.

JEL-codes: H61, H62, H63, H71, H72, H74, H77.

Choosing a Development Strategy for an Enterprise in the Power Engineering Industry, Taking into Account the Policy of the State and the Interests of Stakeholders

Yulia A. Ovchinnikova – Graduate Student of the Department of Economics in Energy and Industry, National Research University «Moscow Power Engineering Institute» (Moscow, Russia). E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

For any commercial enterprise, it is very important to choose the development strategy that is most effective and suitable for modern realities. In addition to state policy in the market, stakeholders also influence the choice of development strategy. Their interests set tasks for the enterprise. Based on them, the company chooses a strategy that will satisfy the largest number of stakeholders.

In consequence of the foregoing, the author has developed a matrix for choosing an enterprise development strategy, taking into account state policy and the interests of stakeholders, using the power engineering industry as an example.

Key words: development strategy, public policy, stakeholders, power engineering, state regulation.

JEL-codes: G18; H71; Q48.

Legislative Cap on Urals Oil Price Discount to Brent Oil

Andrey S. Kaukin – Acting Head of the Scientific Direction «Real sector» of the Gaidar Institute for Economic Policy; Head of Department for System Analysis of Sectorial Markets of the Russian Presidential Academy of National Economy and Public Administration, Candidate of Economic Sciences (Moscow, Russia). Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Eugenia M. Miller – Senior Researcher of the Russian Presidential Academy of National Economy and Public Administration (Moscow, Russia). Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

The approved tax code amendments will cap a discount on Urals oil price to North Sea Dated for the calculation of oil taxes. By our estimates, amendments may bring an additional of around Rb640bn into the budget in 2023. However, the mechanism incorporated in the amendments entails the risk of a «manual» regulation of taxation parameters in the oil industry in case of a dramatic change in prices for oil on the global market.

Key words: Urals crude oil, Brent crude oil, Tax Code of the Russian Federation.

JEL-codes: H24, L71, Q41.

Industrial Production Dynamics in Q4 2022

Andrey S. Kaukin – Acting Head of the Scientific Direction «Real sector» of the Gaidar Institute for Economic Policy; Head of Department for System Analysis of Sectorial Markets of the Russian Presidential Academy of National Economy and Public Administration, Candidate of Economic Sciences (Moscow, Russia). Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Eugenia M. Miller – Senior Researcher of the Russian Presidential Academy of National Economy and Public Administration (Moscow, Russia). Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Q4 2022 saw trend component growth in the industrial production index driven by extractive industries and manufacturing of goods substituting foreign brands which left the Russian market, as well as a pickup in demand for intermediate goods for the state defense order.

Key words: industry, sectors of the economy, mining industry, manufacturing industries, Rosstat, sanctions.

JEL-codes: L16, L6, L7, L8, L9.

Mortgage Lending in 2022

Sergey A. Zubov – Senior Researcher of the Russian Presidential Academy of National Economy and Public Administration, Candidate of Economic Sciences, Associate Professor (Moscow, Russia). Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

In 2022, Russia maintained a high demand for real estate and the banking services pertaining to the issuance of housing (mortgage) loans. The main driver of market development, just as it was during the period 2020–2021, remained the government-funded mortgage programs offering relatively low interest rates. At the same time, over the course of last year, in the situation of unsatisfied demand, there emerged joint schemes of banks and real estate developers in the form of almost interest-free mortgage loans to finance the purchase of an overpriced home. The widespread use of such products has forced the RF Central Bank to resort to constraining measures against mortgage loans with extremely low interest rates, which it plans to implement in 2023.

Key words: mortgage lending, subsidized mortgage programs, mortgage lending market overheating.

JEL-codes: E58, G21, G28.

Output Gap in Russian Economy: Estimate Based on the IMF’s Multivariate Filter

Artur R. Sharafutdinov – Graduate Student of the Russian Presidential Academy of National Economy and Public Administration; Economist of the Monetary Policy Department, Bank of Russia (Moscow, Russia). Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

The article estimates the quarterly dynamics of the output gap using a simple multivariate filter based on data on GDP, inflation and unemployment in accordance with the work of the IMF, taking into account the Phillips curve describing the impact of the output gap on the inflation process, and Okun’s law describing the relationship between the unemployment gap and output gap. The resulting estimate for the first three quarters of 2022 turned out to be 2 p.p. higher than the similar indicator estimated using the univariate statistical Hodrick–Prescott filter, and amounted to -0.4% in Q3 2022, partly due to the negative unemployment gap, -1.1% in Q3 2022, which is a feature of the current restructuring in contrast to the crises of 2008–2009, 2015 and 2020.

The article was prepared within the framework of the scholarship program for graduate students and the implementation of the research work of the state task of RANEPA.

Key words: output gap, unemployment gap, multivariate filter, Okun’s law, Phillips curve, conjuncture.

JEL-codes: E32, C13, C32, C51.

Prospects of the Russian Agricultural Complex in the Conditions of Sanctions

Elena E. Kabanova – Associate Professor of the Department of State and Municipal Administration, Financial University under the Government of the Russian Federation, Candidate of Sociological Sciences (Moscow, Russia). Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

The article assesses the impact of international sanctions on the domestic agricultural complex. Since the main goal of Western political pressure on Russia is the violation of domestic foreign trade, the paper analyzes the risks of domestic foreign economic activity. The stability of cross-border trade is an essential factor in the development of Russian agriculture in conditions of continuous growth of food exports, accompanied by a significant amount of technological imports. The study noted a high level of dependence on the export of a number of agricultural products and negative aspects of the high level of imports of goods for the needs of the agro-industrial complex.

Statistical indicators of Rosstat, information from the Federal Customs Service and the Ministry of Industry and Trade were used in the analysis. The data presented in the current article may be useful to researchers in the field of statistics of the agro-industrial complex. And also in the development of programs to support domestic agriculture and certain aspects of the food doctrine of Russia.

Key words: agriculture, foreign trade, export, import, import substitution, risks, sanctions.

JEL-codes: Q1, F13.

Dynamics of Trade Turnover between Russia and Its Main Partners in 2022

Alexander Yu. Knobel – Head of Foreign Trade Department of the Gaidar Institute for Economic Policy; Director of Center for Foreign Trade Department of the Russian Presidential Academy of National Economy and Public Administration; Director of Institute for International Economics and Finance, Russian Foreign Trade Academy, Candidate of Economic Sciences (Moscow, Russia). Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Alexander S. Firanchuk – Senior Researcher of the Russian Presidential Academy of National Economy and Public Administration, PhD in Economics (Moscow, Russia). Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

In 2022, Russia’s trade turnover stood at $850.5 bn and the surplus rose to $332.4 bn. Exports hit a record high of $591.5 bn (+19.9%) on the back of an increase in exports of mineral fuels to the tune of $383.7 bn (+42.8%), which offset the decline in exports of other goods (-7.4%). The share of mineral fuels in exports reached 64.9% (+10.4 p.p.). Imports amounted to $259.1 bn (-11.7% for the year, and -8.0% in the second half of 2022).

In the second half of the year, the share of neutral countries in exports and imports increased to 63.6% (+19.7 p.p.) and 74.6% (+24.8 p.p.), respectively. In late 2022, imports stabilized at new levels: there was a six-to-seven-fold decrease in supplies from the UK and the US and a one-and-a-half or two-fold decrease in supplies from other major «unfriendly» countries; at the same time, geographically close neutral Turkey and Kazakhstan raised their supplies to the Russian market the most.

Key words: foreign trade, exports, imports, «unfriendly» countries, neutral countries, sanctions.

JEL-codes: F10, F14.

Survey of Current Business (January-April 2023)

Sergey P. Aukutsionek – Head of Center for Transition Economy Studies, Primakov National Research Institute of World Economy and International Relations, Russian Academy of Sciences, Candidate of Economic Sciences (Moscow, Russia). E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Andrey S. Yegorov – Senior Researcher of the Center for Transition Economy Studies, Primakov National Research Institute of World Economy and International Relations, Russian Academy of Sciences, Candidate of Economic Sciences (Moscow, Russia). E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Inessa A. Bachirova – Researcher of the Center for Transition Economy Studies, Primakov National Research Institute of World Economy and International Relations, Russian Academy of Sciences (Moscow, Russia). E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Tatyana V. Serzhantova – Researcher of the Center for Transition Economy Studies, Primakov National Research Institute of World Economy and International Relations, Russian Academy of Sciences (Moscow, Russia). E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

In January 2023, labor utilization rate reached 98% (of the normal monthly level, taken as 100%). This is the maximum value in the entire history of REB’s observations, although once already seen in March 2022. The diffusion indices of expected in three months’ changes of the indicators of wages (69%), order-book level (64%), employment (60%), financial condition (55%) looked very optimistic. The expected in three months’ diffusion index of output (67%), which increased by considerable 24 points from last month can be especially pointed out. The share of those who approved of the economic policy reached the highest value in the history of observations (41%), but it was already so high in September 2022, and the share of disapproving ones fell to 0% for the first time ever.

Key words: Russia, industry, industrial enterprises, price level, wages, employment, output, investment, indebtedness to banks, order-book level, stocks of finished products, capacity utilization rate, financial situation, production restrictive factors.

JEL-codes: D22, D24, G31, L23, P23.

Federal Budget: 2022 Outcomes and 2023 Prospects

Ilya A. Sokolov – Head of Budget Policy Department of the Russian Presidential Academy of National Economy and Public Administration; Leading Researcher of the Gaidar Institute for Economic Policy, Candidate of Economic Sciences (Moscow, Russia). Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Julia E. Kazakova – Researcher of the Gaidar Institute for Economic Policy (Moscow, Russia). Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Macroeconomic and geopolitical atmosphere of 2022 did not have a significant negative impact on the federal budget. In particular, the federal budget deficit at 2022 year-end did not exceed 2.2% of GDP amid the forced increase in government spending, which is almost twice lower than the crisis year of 2020. The key factors of a relatively favorable budget throughout the year remained high oil and gas revenues, as well as the stability of domestic VAT revenues. Despite the growing sanctions pressure, the effect of these factors will generally remain in 2023, which is able to ensure a zero primary deficit even with a slight fiscal consolidation (within 10% of the planned non-interest expenditures).

Key words: federal budget, revenue, oil and gas revenues, non-oil and gas revenues, expenditure, taxes.

JEL-codes: H11, H50, H62, H63.