Zee Beam News

MOSCOW, January 30 (RIA Novosti) - Russia's GDP growth will be close to zero and budgetary revenues could decline 40% in 2009 amid the ongoing global financial crisis, a deputy prime minister and finance minister said on Friday. "Our economic growth will most likely be close to zero," Alexei Kudrin told the State Duma, parliament's lower house. "Budgetary revenues will decline by 4.4 trillion rubles (about $133 billion), or more than 5.4% of GDP," he added, suggesting Russia's budgetary revenues could decline from 10.9 trillion rubles ($321 billion) to 6.5 trillion ($191.5 billion) He said Russia would have to spend a significant portion of its reserve funds to cover the 2009 budget deficit, and increase borrowing in 2010-2011. The Reserve Fund, designed to cushion the federal budget against a plunge in oil prices, and the National Wealth Fund, to help carry out pension reforms, currently total 7.3 trillion rubles ($215 billion), the minister said. In a report on the global crisis's impact on the Russian economy prepared for parliament, the Finance Ministry said GDP grew 6% in 2008, two percentage points less than in 2007, when GDP grew 8.1%. Kudrin said that in 2009 capital outflow could hit $110 billion and export revenues were expected to go down by $200 billion to $269 billion in 2009, and imports to $245 billion. Kudrin said the state had spent 1.145 trillion rubles ($33.8 billion) on measures to support the economy, which is heavily dependent on oil and gas exports, prices for which have plummeted as the crisis has dampened demand worldwide. First Deputy Prime Minister Igor Shuvalov said the current global crisis would continue for three years, and 2009 would be the hardest year. "On the whole the situation will be rather difficult throughout 2009," Shuvalov said. He said Russia could not "withstand global trends," but pledged anti-crisis measures.