Russian pensioners set for $US 20 billion windfall
The Stabilisation Fund, which comes from oil and gas taxes, is now worth almost $US 150 billion.
It’s been a key part of Vladimir Putin's successful management of the economy, but in February it is being split.
$US 20 billion will go into the Welfare Fund and the rest – called the Reserve Fund – will stay out of circulation, at Russia's Central Bank, to prevent inflation escalating.
As political talk heats up about using Russia's windfall energy revenues, business doesn’t seem to be panicking about the decision.
Experts say it makes sense to put the National Welfare Fund cash in high-yield investments overseas – both for the pensioners, and for the economy.
“If this money is invested domestically, it would fuel inflation which is already high, so it’s not advisable in the short term,” believes Aleksandr Morozov, Chief Economist at HSBC Russia.
President Putin says its time to start using the country's huge oil wealth to improve the lives of the Russian people.
So his successor, who'll take over in March, will face the tough challenge of keeping the economy stable and upping investment in social reforms.