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30 Jul, 2009 08:32

2010 Budget outlays set to be slashed

Budget spending will be cut by a quarter in 2010, with an announcment on the decision expected at Thursday’s cabinet meeting.

A source in the government told RT, support for the national economy and subsidies issued to manufacturers will be slashed in the first place.

The state is also planning on getting an additional 227 Billion Roubles, or $7 billion, by setting higher excises on tobacco, alcohol and oil.

Prime Minister Vladimir Putin is expecting the measures to help turn the economy around.

“In 2010, we are expecting to see modest but nonetheless improved main macroeconomic results with growth in GDP, industry and agriculture, to secure a stable increase in the real income of the population. In a word, to begin the trajectory of post-crisis rebuilding.”

The finance ministry plans to cover part of the budget deficit in 2010 by attracting loans. Deputy Finance Minister, Dmitry Pankin, says both global and domestic sources will be tapped.

“We are planning to attract $18 Billion in foreign loans, first of all from issuing Eurobonds. Negotiations with banks, including the World Bank are also possible. Internal loans will bring around $27 Billion, mainly, from state bonds.”