In 2020, the Russian government will have to answer to the question where to get from 4 to 5 trillion. RUB., which will not appear in the Federal budget due to falling oil prices and crisis in the economy. For the last three months the Ministry of Finance found two solutions to this: the sequestration of the budget by 10% and the increase in government debt of only 20% of GDP. Until recently, the Ministry of Finance was able to take the office attracted a record 1.08 trillion RUB during a pandemic. Encouraged by the success, the Ministry of Finance decided from July to September to sell the debt by 1 trillion rubles. But suddenly it turned out that those wishing to give Russia debt is no more.
Buyers of the debt are nowhere to be seen
- Russia is harder to borrow money to Finance the budget deficit, which this year promises to be the largest in a decade. The auction for the sale of Federal loan bonds (OFZ) on 29 July was a failure: the Ministry of Finance failed to sell the entire issue of 5-year OFZ and OFZ 26234 29014 with a floating rate and maturing in 2026.
- The five-year OFZ bought 8.6 billion rubles. the offer of 30 billion, half went to one buyer. OFZ bonds with floating rate have been proposed at 193 billion roubles, but sold was only 19.2 billion rubles., because 90% of the applications received discounts up to 98.5% of the value of the securities.
- In total auction brought about 28 billion rubles, less than half a week earlier, when the Treasury took a 60 billion At the same time, to carry out the plan of borrowing, the government needs to sell at 80-85 billion rubles of debt every week. Since this is not happening, the question is: who will buy Russia’s state debt. Despite the fact that Russia has a low level of debt (just 20% of GDP), demand for it not.
- The success of the second quarter when they managed to occupy 1.08 trillion rubles, was explained by coincidence. On the one hand, the Central Bank reduced the key rate and making money cheaper. OFZ yields, by contrast, was growing and was much higher than papers from developed countries. However, the cycle of decline in the key rate came to an end, the ruble started to devalue, losing significantly from the end of June.
- In turn, the Finance Ministry aims to sell medium – and long-term debt, says the head of the Center of the development strategies of Gazprombank Yegor Susin. But the capacity of such a market given the potential investors – pension and insurance funds, private investors, banks and population – 1-1,5 trillion And the Finance Ministry have already chosen this volume.
- To take and further, says the analyst, the Finance Ministry need to increase premiums for private investors, reduce the term and to connect to the public debt of the Central Bank as a buyer. But the Finance Ministry is not going to pay big bonuses and to reduce the term of the bonds. So he will have to part with the idea of financing the budget deficit through public debt and spending budget sequestration. In 2021 it is going to 1,428 trillion in 2022-m – 1,892 trillion, and in 2023 – at 1,364 trillion. The economy and the Russians will feel it for yourself.