Russia’s 700 billion Rouble New Years holidays

Calculations by Audit and Consulting company FBK, show the the 10-day New Year holiday in Russia will cost up to 700 billion roubles.

With the production volumes during holidays falling by half in comparison with a normal work day, Igor Nikolayev, director of the Strategic Analysis Department of FBK, says that each holiday will cost the country 700 billion roubles.

Russia’s economy is expected to grow by 1.6 percent in 2010 to 43.2 trillion roubles.

“As it turns out, the country loses just as much due to the organized holidays,” says Nikolayev.

Nikolayev confesses the figures are purely estimates, but says that the damage is real and must be taken into consideration.

“One should estimate its possible influence, as it’s the economy, it’s people, it’s their lives. And I’m also absolutely sure that nobody in our government calculated the impact of the extended New Year holidays on Russia’s economy. And, logically, nobody would work of their own will while the whole country takes its time. Hope, it’ll make our authorities take a little thought about it, but, frankly, I doubt they really will.”

According to Russian law, holidays can only be cut by 4 days. However, these for days would mean in increase by 280 billion roubles, which would mean 45 billion roubles for the federal budget.

To compare figures, the four cut days would more than cover the 30 billion roubles that were allocated for an increase in unemployment benefits for 2009

In 2009, Russia stood in 52nd place in GDP per capita at $15 thousand.

“We are actually a poor country and we shouldn’t allow ourselves the luxury of having such long holidays.”

Nikolayev suggests moving some of the days to May and estimates that the price of each holiday will drop to between 50 and 60 billion roubles.

“This is the lesser evil since many people use the days off and holidays to plant potatoes in their garden plots. So, by moving the holidays to May, we will at least stimulate our citizens to work on their gardens and facilitate the growth of the informal economy.”