ALEXEI VEDEV: I THINK THE GOVERNMENT WILL HAVE NO OTHER OPTION, BUT THE PIVATIZATION
Alexei Vedev, Head of the Financial Studies Department, the Gaidar Institute and Former Deputy Minister of Finance (2014-2017) commented to the MK daily on the situation subsequent to the change of the Government and appointment of Andrei Belousov, Ex-Aide of the RF President as the First Vice-Premier.
“It is too early to assess the Government, though it is clear that it is made up of people with a certain potential. The Government’s objectives are clear: they are set out in the RF President’s famous May Decrees of 2018. It is primarily required to embark on the trajectory of sustainable economic growth.
In terms of solution of this issue, we have already lost two years and there are doubts about the third year, that is, the current one. To achieve the goal, the new government has to ensure the adequate financing of national projects and a well-balanced budget policy, as well as find the exit from the extended investment pause.”
Alexei Vedev says that privatization is a separate issue. “All the experts are unanimous that the presence of the state in the economy is overwhelming, so it is necessary to sell a portion of state-owned assets and it should be done through stock exchanges with participation of minority shareholders. I know that Andrei Belousov, new First Vice-Premier is regarded as the advocate of consolidation of the role of the state in the economy, but I believe the government has no other option, but the privatization. The year 2019 saw the complete inefficiency of the state-owned property: large state-run companies which were much relied on failed to facilitate the required speed-up of the economy.”
Alexei Vedev restrained from giving personal assessments of new ministers, but noted that “the former government succeeded more in saving funds than in investing them. I do not quite understand why it was necessary to run a budget surplus amid the stagnating economy. The President’s latest message was assessed by experts as very expensive because the measures listed in it required more than Rb 400bn a year. But this country has the budget surplus of virtually “extra” Rb 2 trillion. Hope, the new government will manage to correct this situation”, Alexei Vedev concludes.
In terms of solution of this issue, we have already lost two years and there are doubts about the third year, that is, the current one. To achieve the goal, the new government has to ensure the adequate financing of national projects and a well-balanced budget policy, as well as find the exit from the extended investment pause.”
Alexei Vedev says that privatization is a separate issue. “All the experts are unanimous that the presence of the state in the economy is overwhelming, so it is necessary to sell a portion of state-owned assets and it should be done through stock exchanges with participation of minority shareholders. I know that Andrei Belousov, new First Vice-Premier is regarded as the advocate of consolidation of the role of the state in the economy, but I believe the government has no other option, but the privatization. The year 2019 saw the complete inefficiency of the state-owned property: large state-run companies which were much relied on failed to facilitate the required speed-up of the economy.”
Alexei Vedev restrained from giving personal assessments of new ministers, but noted that “the former government succeeded more in saving funds than in investing them. I do not quite understand why it was necessary to run a budget surplus amid the stagnating economy. The President’s latest message was assessed by experts as very expensive because the measures listed in it required more than Rb 400bn a year. But this country has the budget surplus of virtually “extra” Rb 2 trillion. Hope, the new government will manage to correct this situation”, Alexei Vedev concludes.