Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

First-Quarter Audit Paints Dismal Economic Picture

In an indication that Russia remains mired in economic depression, the State Audit Chamber released a report Wednesday for the first quarter of the year with figures slumping across the board.

Industrial production fell 3 percent in the first quarter of 1999, compared with the same period last year; agricultural production dropped 7 percent; and Russian salaries shrank 30 percent, the State Audit Chamber said.

Government revenue in the first three months totaled 90.3 billion rubles ($3.73 billion), or 19.1 percent of the target for 1999, Audit Chamber chairman Khachim Karmokov said at a news conference Wednesday. The figure includes 80.3 billion rubles of tax revenue, or 20.1 percent of the target.

The revenue is bigger in both absolute figures and annual target figures compared with the same period in 1998 (59.1 billion rubles, or 16.7 percent) and 1997 (51.4 billion rubles, or 12.1 percent). With inflation factored in, however, this year's sum is a fraction of 1998's $9.67 billion and 1997's $8.98 billion.

"The most worrying situation is in the funding of the investment sphere. Only 232.8 million rubles were provided as state investments, which is only 3.5 percent of the target figures [for the year]," the chamber said in a statement.

"Out of 155 federal programs, investments were provided only for two. What we have now is the primitive erosion of the budget," Karmokov added.

The poorest collection rate came from dividends on state stocks in commercial enterprises, which totaled merely 1.5 percent of the goal. While the target figure, 1.5 billion rubles, "is 10 times less than it should be," Karmokov said, only 22.2 million rubles was collected.

Rents on government property were also an offender, with revenue totalling 255.5 million rubles, or 3.2 percent of target figures for 1999.

The part of the budget that received the best financing was "international activities," which includes allowances for diplomats traveling abroad. Some 11.3 billion rubles were spent - 30.9 percent of the yearly target.

Other items that were funded close to targeted levels included courts (565 million rubles, 11.7 percent) and law enforcement activities (7.1 billion rubles, 13.9 percent).

Also on Wednesday, the State Statistics Committee reported its first-quarter findings, which showed that Russia's leading economic indicators dropped an average of 3.7 percent quarter-on-quarter. Industrial output slumped 2 percent, agricultural production dropped 5.4 percent, and retail trade volume fell 15.8 percent. On a more positive note, railroad transportation grew 6.1 percent and communication services rose 17 percent, the State Statistics Committee said.

The committee plans to detail its findings Thursday.


First-Quarter Scorecard

Federal Budget Revenues and Expenditures for January-March 1999

(preliminary figures of the Audit Chamber, in billions of rubles)

Target Fulfilled

figures sum share of total


Revenues 399.5 80.3 20.1

Taxes, including excises 87.1 21.1 24.2

Non-tax revenues 33.0 5.1 15.6

dividends on state stocks 1.5 0.022 1.5

rents from state property 4.1 0.135 3.3

Expenditures 575.0 113.7 19.8

International activities 36.6 11.3 30.9

National defense 93.7 16.6 17.7

Law enforcement and state

security activities 51.3 7.1 13.9

Education 20.9 4.0 19.2

Culture, art, cinematography 3.0 0.373 12.2

Social policies 41.9 10.5 25.0

Servicing of the state debt 166.8 30.4 18.2

Finance aid to the regional

budgets 43.4 10.9 25.0

Target budget funds 44.0 4.5 10.2

Deficit 101.3 - -

Sources of domestic finance 55.4 -4.5 -8.1

Sources of external finance 45.9 28.4 61.9