‘Most foreign companies want to stay in Russia now’

First Vice Premier of Russia Andrey Belousov has delivered a speech at a “Government Hour” meeting in the Federation Council today. He has talked about a slowdown in weekly inflation, a decrease in the Russian economy, the West’s attempts to impose a global economic blockade of Russia and the unwillingness of foreign companies to leave the country. Read the key takeaways in Realnoe Vremya’s report.

About support for economy at 7-8 trillion

“One of the main risks today is, on the one hand, the decrease of the economy because of logistical restrictions and insufficient liquidity in the economy, on the other hand. The data of surveyed managers of backbone enterprises demonstrate that this decrease has already begun, unfortunately, though it hasn’t almost touched the labour market yet,” Belousov has said today (cited by Interfax).

According to him, a fall in industrial production and commerce has been some 11%, in other sectors it is 9-10%.

The total amount of support for the economy, which is safe for inflation, is estimated at 7-8 trillion rubles. The money will be spent on preferential loans for industrial enterprises and commercial companies at 11% (the loan portfolio will be 1,3 trillion rubles) and at a 10% rate for backbone agricultural organisations (300 billion rubles), IT companies, etc.

“So considering the mortgage, loans of backbone enterprises, loans for SMEs, we have almost chosen these limits. This means that some other measures need to be taken to support other groups of enterprises, including to lower the tax burden and so on,” has claimed Russia’s vice premier.

About compensation for a price rise for low-income citizens

From 2 to 8 April, inflation decelerated to 0,66% in Russia, has said Andrey Belousov. After the imposition of sanctions, prices grew by 2% a week on average. Commodity prices have risen by 10% on average. However, there are exceptions, and it is those goods that were in high demand.

“For sugar and the so-called borscht set — by 50-60%. Durable foods (salt, flour, grains) — by 10-20%, non-foods with high import dependence — by 16%,” has added the vice premier (cited by Interfax).

On 20 March, consumer demand for socially important foods stabilised, stocks started to be replenished: it is more than two weeks for sugar, over 5 weeks for sunflower oil, 5-6 weeks for flour and grains, 10-12 weeks for baby formulas and canned products.

Belousov has continued talking about inflation and claimed that measures of compensation for pensioners, low-income citizens and families with children are being elaborated to minimise the consequences of the rise as much as possible. President of Russia Vladimir Putin issued such an order.

About the West’s attempt to impose an economic blockade

Now the West is trying to impose an economic blockade against Russia in four areas, has said the Russian vice premier: financial, commercial, transport and humanitarian.

“The idea of our geopolitical opponents is to isolate Russia from the world economy as much as possible, to literally tear it off global economic links, thus launching processes of degradation and dissolution of our economic system,” has claimed Belousov.

However, according to him, it is impossible to create such a blockade fully.

“It is impossible to isolate Russia — the world’s sixth-biggest economy — from the global economic system. And the events in the last a month and a half clearly prove it,” he has claimed.

About foreign companies’ willingness to stay in Russia

Belousov called the West’s attempt to impede cultural values from returning to Russia a provocation: “Of course, our opponents — I will call them this way because they are, in fact — they are constantly provoking us.”

The vice premier says this is aimed at Russia’s abrupt actions against foreign companies that continue operating in the country.

“Most foreign companies — I have met with managers of many of them here — want to stay now. They obey the decisions made by their headquarters whose stance is mainly “neither yes nor no, we’ll see how things will unfold,” TASS cites Belousov.

A bill on the introduction of external management of foreign companies that announced their exit from the Russian market was introduced in the State Duma yesterday. The initiative will apply to those companies that made the decision without obvious economic reasons resting on anti-Russian moods in Europe and the US.

Daria Pinegina