Feb 16, 2021
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Minister Reshetnikov: There will be more money in wallets. True true

Minister Reshetnikov: There will be more money in wallets.  True true

Photo: Vitaly Belousov / TASS

According to the forecast of the Ministry of Economic Development, the fall in real disposable income of the population will soon stop, and in 2021 they will grow by 3%. Of course, with the proviso inherent in officials that this will not happen right off the bat, a run is needed – the result is expected in the second half of the year.

“We will see a recovery in the population’s income this year … It will happen, the third or fourth quarter, of course, the main one. This is true, “said Minister Maxim Reshetnikov on the air of the Russia 24 TV channel.

The head of the Ministry of Economic Development and Trade also assured the deputies of this, speaking in the State Duma: “The basis of our economic development is the steady growth of the population’s income. Its contribution to the acceleration of economic growth will be almost half. For this, real incomes must grow at a rate of at least 2.5% per year, ”stressed Maxim Reshetnikov.

So far, the real incomes of Russians have fallen so much that more than half (64%) of citizens are barely making ends meet. This is evidenced by the results of a joint study of the HeadHunter job search platform and the Money Forward fintech company.

A quarter of Russians (25%) of Russians admitted that their salary does not cover basic needs, and 39% hardly have enough income for the minimum necessary for life. And only 36% succeed in fully satisfying basic needs within the framework of the salary.

Maybe the first two categories of our fellow citizens, who together made up 64%, have too high demands? But, you see, it is difficult to reproach those who call spending on food (62%), rent and mortgage payments (35%), utilities (27%) and repayment of loans (20%) as the biggest items of expenditure for their craving for excesses.

And, of course, in order to somehow stay afloat, the Russians save as much as they can. Due to the lack of money, three quarters of our fellow citizens (75%) are forced to refuse to buy new clothes and shoes, as well as travel. 71% – from interesting leisure, 42% – from paid medicine and medicines. 36% of the respondents are forced to save on education.

And all the same, almost half of the respondents (46%) lack more than 20 thousand rubles a month for salary, 44% lack from 10 thousand to 20 thousand rubles, every tenth – from 5 thousand to 10 thousand rubles a month.

And this is despite the fact that, according to Rosstat, the average salary of Russians in January-November 2020 increased by 5.5% and amounted to 49,454 rubles. Somehow I do not really believe in this figure, however, in family accounting departments, debit and credit still did not come together, since prices actually increased, and real disposable cash income in 2020 compared to 2019 decreased by 3.5%.

“This is the statistics that show the need for further coordinated work,” – said the press secretary of the Russian President Dmitry Peskov, commenting on the statistics of Rosstat on the decline in real incomes of Russians. He admitted that the situation in this regard is “so far” tense, since “there is indeed an undesirable trend as of the last year.”

And he pointed to the light at the end of the tunnel, reminding that the President of the Russian Federation Vladimir Putin “I have repeatedly said that the main task is to reverse the negative consequences of the global crisis phenomena, which lead to a drop in living standards, and to bring the trajectory towards growth.”

But in the coming years, one should not count on an increase in the income of Russians, believes Irina Aydrus, Head of the World Economy Program at the Institute of World Economy and Business, RUDN University:

– The situation with the incomes of Russians has remained tense for 8 years in a row, since 2014 we have seen a worsening of the situation.

And although we see GDP growth over this period by 31.5% in ruble terms, we should not forget that this figure does not take into account the devaluation of the ruble and real inflation. If we look at Russia’s GDP in dollar terms, we see a 36% drop compared to the same 2013.

The number of the poor is growing in the country. 13.3% of Russians live below the poverty line – about 20 million people.

The same applies to the real incomes of citizens – the fall declared by Rosstat is the nominal reduction in the ruble volume. If we correct this indicator only for the devaluation of the ruble, then we will get completely different figures instead of 3.5%. If we present the figures in dollars, then even without adjusting for inflation, we will get a 42% drop in 2020 compared to 2013.

“SP”: – This situation is a natural result of the existing system in the country, unable to withstand such challenges as a pandemic, economic crisis etc. And how justified are references to the crisis and the pandemic, if even before the pandemic the incomes of Russians did not grow, in contrast to prices? Can you point out system errors?

– This situation is the accumulated result of various problems, both economic and political. These are the sanctions introduced in 2014, and the dependence of the Russian economy on raw materials exports, primarily hydrocarbons, which account for 52% of the commodity structure of exports, the underdevelopment of private entrepreneurship, the deteriorating investment climate, and of course, the global crisis caused by the pandemic.

External factors caused by COVID19 hit the Russian economy more painfully – the fall in demand and prices for energy resources, the difficulty in doing trade, the termination of international contacts in a number of areas, the stagnation of the world economy.

In Russia, the main share of gross domestic production is created by state corporations and large businesses, among which there are many full-cycle enterprises that continued to operate even under severe restrictions, and the share of private entrepreneurship, small and medium-sized businesses accounts for about 22%. If we take Europe, the drop in GDP was more serious, since in the EU, depending on the country, medium and small business creates from 40% to 80% of GDP, and it was he who was under the most serious blow due to the introduction of strict restrictions.

“SP”: – If, as the authorities claim, Russia coped with the crisis and pandemic better than Europe, then why can’t we see, conditionally, refugees to us from the west?

– If we talk about the greater attractiveness of the EU for refugees, then it is explained not only by the high standard of living, but also by social security and naturalization policy. It should be understood that 60% of refugees seek to get to Germany, Spain and France.

Benefits for refugees in Germany represent 75-80% of regular social benefits and range from 218 to 351 euros plus all kinds of other social and benefits. If we compare it with Russia, the process of confirming refugee status is very bureaucratic, and the level of social guarantees is incomparably low compared to European countries.

Although the pandemic has made its own adjustments here – there was a 30 percent decrease in the number of people seeking asylum in the EU in the first nine months of last year due to restrictions on international travel and tough policies adopted at the external borders of the EU.

“SP”: – What will help and what will hinder the improvement of the economic situation in the country?

– Stabilization of oil prices or their continued growth, further revival of the world economy, control of the pandemic and successful vaccinations allow us to hope for GDP growth by 4-5% in the coming years. Although there are risks that can hinder the forward dynamics. In particular, this is a potential increase in social tension, a worsening investment climate and negative expectations.

“SP”: – According to the forecast of the Ministry of Economic Development, real disposable incomes of the Russian population will grow by 3% already this year …

– In the coming years, one should not count on an increase in the incomes of Russians. The way out may be serious restructuring and transformation in various areas. The revival of business activity in the country would be helped by an increase in government spending both for the implementation of large projects and for direct financial support. Thus, the EU, the USA and a number of other countries continue to support the economy with large financial injections.

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