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IN FOCUS OF THE RUSSIAN PRESS

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GZT.ru: Putin orders budget deficit to be cut to zero; Moskovsky Komsomolets: Belarus' modest contribution; Vzglyad: More than an order; Rossiiskaya Gazeta: Three-volume football book.

GZT.ru: Putin orders budget deficit to be cut to zero

Prime Minister Vladimir Putin believes that the policy of accumulating petrodollars has been justified and should be resumed after the crisis ends. If it is to continue building up these funds, Russia needs a deficit-free budget, and for that it should start cutting expenses.

Before the crisis, Russia had a budget surplus and channeled petrodollars into the Reserve Fund and the National Wealth Fund. But these reserves are running out fast; they have been used to raise pensions, launch the "clunkers for cash" program, and bail out companies and banks.

The Reserve Fund had $142.60 billion as of September 1, 2008, and the National Wealth Fund $93.4 billion as of November 1, 2008. By May 1, 2010, the Reserve Fund plunged 71.5% and the National Wealth Fund 5%.

Reducing the budget deficit is the key to resuming this policy of accumulating money in the Reserve Fund. Putin said a low and possibly even a zero budget deficit should be the norm for Russia.

Budget revenue depends on the growth rate of the economy: the higher the growth, the larger the revenue. Deputy Finance Minister Tatyana Nesterenko said the budget deficit could be cut to 5.1% of GDP in 2010, "according to the reviewed macroeconomic forecast of the Economic Development Ministry."

However, it is not the GDP growth rate but oil prices that primarily determine budget revenues. "In 2009, half of the federal budget expenditures were covered by oil and gas revenues," Finance Minister Alexei Kudrin said.

Moskovsky Komsomolets: Belarus' modest contribution

Belarus is considered the last bastion of socialism among the countries of the former Soviet Union. There too, however, the situation is changing. This includes the official approach to small businesses. The government has already provided approximately 20 million Russian rubles ($661,520) to support the country's small companies.

Small business support is a key element of state policy throughout the world. Belarus has long been an exception to this rule. The country's individual entrepreneurs and small companies could only count on assistance from non-government organizations.

But the economic downturn hit Belarus hard. According to the National Statistics Committee, Belstat, real GDP declined by 18.6%. This slowdown required urgent action, and the government launched an unexpectedly ambitious campaign to support small business. Belarus was even included in a list of 30 countries providing the most significant assistance to small business.

The government of Belarus has made a complete turnabout in its treatment of small businesses, some analysts believe. Small business related issues are constantly covered on TV, radio, and in print media. The government has even drafted a law on small business support and streamlined small business inspection procedures. The process of registering a new business has been simplified and the application of a simplified tax schedule has been expanded.

But there is a major hurdle in the way of small business development in Belarus. The previous policy of preferential treatment for state enterprises and the suppression of entrepreneurial activity have resulted in a lack of motivation to start a business. Polls show that there are very few people willing to start their own business. In addition, many are afraid that the current business friendly policy is no more than a temporary campaign, which could be discontinued at any moment.

Vzglyad: More than an order

Russian President Dmitry Medvedev met with his eight presidential envoys to the federal districts on Saturday. The president said that the system had proved its efficiency during its ten years of operation, but added that the envoys should change their priorities to reflect today's reality. Dmitry Medvedev believes that his representatives to the federal districts should switch their priorities away from "introducing order" towards resolving social and modernization issues.

He emphasized that at the beginning, presidential envoys had to introduce order into the country's administration: "We managed to reconstruct a proper administration and introduce normal administrative discipline which had to a great extent been destroyed in the preceding period." The president added "in a short period of time, federal laws were once again in effect across Russia."

In addition, Medvedev outlined priority issues that his envoys currently face.

At the current stage of development, presidential envoys should encourage regional authorities and business representatives to take a more active role in the country's modernization. The president believes that ensuring labor laws are strictly adhered to amid the financial crisis is another important goal for his envoys.

Before meeting with Medvedev on Saturday, Presidential Envoy to the North Caucasus Federal District and Deputy Prime Minister Alexander Khloponin suggested that the federal authorities give the envoys more power. He believes that the system whereby one person simultaneously holds the office of presidential envoy and deputy prime minister has proven its efficiency in the North Caucasus Federal District where both political and economic issues need to be addressed.

Rossiiskaya Gazeta: Three-volume football book

In Zurich, Switzerland, the Russian bid committee delegation, headed by First Deputy Prime Minister Igor Shuvalov, submitted the country's bid book for the FIFA World Cup 2018/2022 to FIFA's President Josef Blatter.

The massive bid book, comprising three volumes and 20 chapters, gives a detailed account of Russia's plans for hosting the championships. The second, and largest, volume is dedicated to future stadiums and details 16 venues that meet the FIFA standards in all regards.

Igor Shuvalov emphasized that the book was more than merely a box ticking exercise for FIFA, it was about Russia's future: "Russia's lack of sports infrastructure is an advantage - it allows us to build eco-friendly stadiums which will become an example for football in the future."

In early February, World Football Insider, an Internet portal about football, rated countries that are bidding for the world championship. They placed Russia slightly behind England: the Russian bid's main disadvantage being the absence of infrastructure, while the advantages included the country's vast financial resources and the fact that no Eastern European country has ever hosted the world cup. This last point is very significant for FIFA: the organization would get a new region which it would be able to rely on in the future.

May 17, 2010 

RIA Novosti




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