Evgeniy Goryunov, Head of Monetary Policy Department at the Gaidar Institute, commented to Nezavisimaya Gazeta on the increase in public debt envisaged in a Federal budget draft for 2027–2029. He believes that there are currently no grounds for a budget crisis, though the cost of servicing the debt raises more questions.
The draft budget forecasts an increase in public debt from 21.7% of GDP in 2027 to 24.1% in 2029. According to Evgeniy Goryunov, this increase by itself does not yet signal problems involving sustainability of public funds. Options for financing the deficit remain, although much will depend on interest rates.
However, the expert suggests assessing the situation not so much by the size of the debt relative to GDP, but rather by how much the state spends on its servicing.
"I see no reason for concern regarding medium-term sustainability of the national debt. This does not mean that the trends are entirely optimistic or trouble-free, but there is currently no trigger for a fiscal crisis. Resources for financing the deficit are far from exhausted, although, of course, much depends on interest rates," emphasized Evgeniy Goryunov.
He believes that the ratio of debt servicing costs vs. budget expenditures and total deficit volume is more indicative. He noted that OFZ yields exceed expected nominal GDP growth by nearly 10 p.p. According to Evgeniy Goryunov, this gap between borrowing costs and economic growth rates is a key indicator of fiscal sustainability. If it remains high, budget parameters will need to be normalized in the coming years; otherwise, the burden on public funds could rapidly increase.