Against the background of the war with Ukraine, Russia spent almost half of the liquid part of the National Welfare Fund, which is the primary source of resources "for a rainy day". Four out of nine trillion rubles had been out of control.
Russia uncontrollably spends trillions of rubles on the war with Ukraine
According to opposition journalists from the Meduza publication, they analyzed only the expenses of the Ministry of Finance of the Russian Federation for 2023.
What is essential to understand is that the National Welfare Fund was created in the aggressor country, as the Kremlin thus wanted to reduce the dependence of the Russian economy on raw material prices.
However, after Russia's invasion of Ukraine and the introduction of sanctions on Russian oil, which included both a price ceiling and restrictions on direct supplies of raw materials to the West, the price became too volatile, and the ruble exchange rate also became less predictable.
Moscow's record spending was influenced by a rapid increase in prices in the summer of 2023 and a new drop in the ruble exchange rate.
The Russian Ministry of Finance went into debt to finance military needs
Journalists draw attention to the fact that the articles "National Defense" and "National Security" of state budget have increased by 60% compared to 2021.
As a result, budget expenditures exceeded the statutory norm by three trillion rubles and reached 32 trillion rubles. The budget deficit turned out to be higher than the forecasts. The authorities placed federal loan bonds all year and thus borrowed 2.5 trillion rubles.
However, even such difficult decisions did not save the situation. That is why the Ministry of Finance of the Russian Federation was forced to sell half a billion euros, 115 billion yuan and 232 tons of gold from the National Bank of Ukraine last month and took the received 2.9 trillion rubles to cover the deficit.
What is essential to understand is the maximum allowable amount for 2023.
As a result, the liquid part of the Russia's Central Bank decreased to five trillion rubles, although at the beginning of the war it was almost nine trillion rubles.
