Fitch Said That Domestic Markets Would Be The Basis For Financing The Russian Budget In 2020
Domestic markets will provide the primary part of financing the budget deficit for Russia in 2020, the press service of the international rating Agency Fitch said.
"Domestic markets will be a key source of funding in the region, and we expect them to provide the bulk of funding for Russia and Ukraine, about half for Armenia, and about a third for Kazakhstan and Georgia. Financing from external markets is not an important source of financing the deficit and will remain limited in 2020," the Agency reports.
For example, according to analysts, Russia ("BBB") will use the national welfare Fund to compensate for the loss of oil revenues," but will rely on domestic markets for the bulk of its financing needs."
Fitch also forecasts an increase in national debt by an average of 8.1 percentage points of GDP in the CIS and the black sea region in 2020. Also, most countries in the region will increase their already high shares of foreign currency debt, and except for Russia and Kazakhstan, these indicators will remain higher than those of comparable countries.
Average budget financing needs (national budget deficit plus debt amortization) for the CIS and black sea region are projected by the Agency at 10% of GDP in 2020, which is higher than the peak levels of 7% of GDP in 2009 and 2015. According to analysts' forecasts, the funding needs will be at the level of $152 billion, which is equivalent to 7.4% of the projected total GDP for 2020.