Russia Said to Weigh $2.8 Billion of Budget Cache for Crimea
By Evgenia Pismennaya and Ilya Arkhipov Mar 26, 2014 5:06 AM ET
Russia may direct at least $2.8 billion of emergency budget reserves this year to subsidize Crimea, the Black Sea peninsula it annexed from Ukraine, according to two people with knowledge of the plans.
The government estimates 100 billion rubles ($2.8 billion) to 130 billion rubles are needed to support Crimea and the port city of Sevastopol, home of Russia’s Black Sea Fleet, the people said, asking not be identified as the planning is confidential. The amount may swell to as much as 260 billion rubles to boost pensions and salaries for state officials to match Russian levels, one of the officials said.
President Vladimir Putin, facing the weakest economic outlook since 2009 and first-quarter capital outflows that may exceed the level for all of last year, defied the U.S. and European Union’s threats of sanctions to absorb Crimea, a predominantly Russian-speaking region.
“The spending increase intensifies pressure on the budget,” Evsey Gurvich, head of the Economic Expert Group think tank, said by phone today. “The budget this year is tight but it can be managed.”
Putin last week ordered Crimean pensions to be increased “without delay.”
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http://www.bloomberg.com/news/2014-03-25/russia-said-to-weigh-2-8-billion-of-rainy-day-cash-for-crimea.html
