Ministers have planned for the Russians the growth of salaries, which will stretch the entire economy

The government came up with a more than optimistic forecast of the country’s socio-economic development in 2023. The Russians are promised economic growth, real wages and low inflation. All indicators have become much better than previous expectations and differ markedly from the forecasts of more skeptical experts. But a significant strengthening of the ruble should not be expected: the average annual rate, according to the updated calculations of the Ministry of Economics, will be 76.5 rubles per dollar, which is almost 8 rubles more than previously planned. Further weakening of the ruble is expected in 2024-26.

Mikhail Mishustin held a joint board meeting of two key ministries – the Ministry of Finance and the Ministry of Economics – at the White House. This is the first time this format has been used for debriefing. However, since all the main decisions aimed at eliminating the crisis phenomena in the economy were taken jointly by the departments, they decided to reap the benefits together.

The prime minister noted that “more than tens of thousands of sanctions” were adopted against Russia, and “all this has been prepared for years” with the sole purpose of destroying the economy and harming citizens. But the government coped with these challenges: “the inevitable decline”, according to Mishustin, turned out to be moderate, and from the second half of the year it was possible to return to the trajectory of steady growth. As a result, despite the decrease in percentage terms, the volume of GDP exceeded the figures for 2019.

Finance Minister Anton Siluanov confirmed the positive trends in his speech. The current situation, according to him, makes it possible to shift the focus from the anti-crisis agenda, which the Ministry of Finance and the Ministry of Economics have been working on for the past year, to development goals. This is primarily technological development, infrastructure expansion, targeted support for citizens, ensuring the country’s security and integration of new regions.

According to Siluanov, the last item is planned to be completed in an accelerated mode. The task is to restart the economy and financial system of the DPR, LPR, Kherson and Zaporozhye regions as soon as possible and bring them to the level of neighboring regions.

The head of the Ministry of Finance said that 400 bank offices have already been opened in the new subjects and almost a thousand ATMs have been installed, conditions have been created for non-cash payment of salaries and pensions, services for accepting deposits and lending have become available. “The next step is the issuance of preferential mortgage loans at 2%. The program will start working this year!” Siluanov said.

Even more optimism to the participants of the board was brought by the speech of the head of the Ministry of Economic Development Maxim Reshetnikov. As it turned out, in almost all indicators, the ministry significantly improved its own forecasts made in September 2022, and now promises the Russians solid “buns”. First, real wages. They will grow up. And not by 2.6%, as previously expected, but by more than 5%. According to Reshetnikov, the implementation of this scenario will be facilitated by low unemployment and competition for personnel from employers.

Next is inflation. She will go down. The new forecast of the Ministry of Economics for the end of the year is 5.3%. “Due to what? – Reshetnikov asked and explained himself: there will be no indexation of tariffs for housing and communal services (they were already raised ahead of schedule at the end of 2022) and there will be a good harvest. “We are receiving positive assessments from the Ministry of Agriculture for this year,” the minister reassured. In addition, there are dampers that “protect the domestic market from external price fluctuations.”

The Ministry of Economics believes that an improvement in the financial situation will force citizens to abandon the savings model of behavior that they have been adhering to since the beginning of the NWO. Russians will start spending more of their money and taking out more loans for expensive purchases – this will play into the increase in retail trade turnover (plus 5.3% in 2023). In turn, the growth in consumer demand, according to the calculations of officials, will lead to a more accelerated economic recovery than previously predicted. Instead of an increase of 0.8%, 1.2% is now expected.

It should be noted that the government counted on consumer demand as the engine of the economy last year as well. However, these expectations were not justified: the retail trade turnover fell by 6.7%. Now many experts also do not believe in the recovery of consumer demand, pointing out that the population does not feel confident in the future.

According to independent analysts, retail turnover will fall by at least 0.5%, and the economy will shrink by 1% by the end of 2023.

As far as inflation is concerned, good harvests do not guarantee lower prices in stores. And the numbers in bills, as the Russians could recently see from the example of general house needs, are negatively affected not only by the indexation of tariffs, but also by changes in the calculation methodology. Analysts believe that inflation will not be able to drop below 6%. And the Central Bank in its forecast assumes that by the end of the year prices may rise by 7%.

Doubts about the assessments of the Ministry of Economics and the Ministry of Finance were also publicly expressed by members of the board. So, Andrey Makarov, the head of the State Duma Budget Committee, proposed to arrange a sweepstakes with the question: how many times will the forecast for income and other indicators of socio-economic development change over the next six months?

“We don’t know what will happen tomorrow. And what will happen in three years, we know for sure. But the most accurate forecasts will come 10 years ahead,” the deputy said sarcastically.

Indeed: judging by the forecasts of the Ministry of Economics, officials did not expect such a sharp weakening of the ruble in the fall. In September, they predicted that the average annual exchange rate in 2023 would be 68.3 rubles per dollar. However, now the calculations have changed immediately by 8 rubles to 76.5 rubles per dollar. In the future, a gradual weakening of the ruble is expected: in 2024 – 76.8 rubles, in 2025 – 77.6 rubles, in 2026 – 78.8 rubles.

In turn, the chairman of the Economic Policy Committee of the State Duma, Maxim Topilin, was pessimistic about the intentions of the Ministry of Finance to use the savings of the population as a source of “long money” necessary for the development of the economy. Referring to his experience in the Cabinet of Ministers (until 2020 he headed the Ministry of Labor, and then worked for another year in the Pension Fund), Topilin said that such methods as the long-term savings program, which the Ministry of Finance pins hopes on, do not give a serious result and should be sought other mechanisms.