Kudrin: Responsibility and Stabilization   Leave a comment

kudrin02.03.2009: Alexei Kudrin, Russia’s finance minister, made a rare admission of responsibility for the country’s severe economic crisis.

Kudrin says his country’s economy has been set back by five years.

The Russian government overspent its vast oil revenues in recent years, fueling inflation, and failed to diversify the national economy.

Kremlin officials usually blame the West, and specifically the United States, for the global economic crisis.

Kudrin, who is also a deputy prime minister, said the financial crisis had set back the Russian economy by 5 years, and confirmed Russia would have a budget deficit of 8 percent in 2009 — its first for a decade.

Russia’s stock markets plummeted by nearly 70 percent in 2008, and the country spent a third of its reserves — or $216 billion — defending its currency, the ruble. The Kremlin has also committed vast sums to bail out big business in Russia, which is heavily in debt to foreign banks.

Kudrin said there were signs the Russian economy was stabilizing. He confirmed that investors pulled $40 billion out of Russia in January, but said that enormous outflows of cash had stopped.

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