OREANDA-NEWSThe International Monetary Fund (IMF) recommends that the Russian authorities oblige all state enterprises to publish annual financial statements, as well as include their aggregate indicators in the consolidated budget statements. This is one of ten recommendations addressed to Russia in the fund’s report on financial transparency of budget policy, government effectiveness and reducing vulnerability to corruption. Now the data of more than 30 thousand Russian state-owned enterprises remain outside the framework of the consolidated budget of the state, and many of them do not publish audited reports, the IMF states.

Other IMF recommendations include compiling a 50-year budget and macroeconomic forecast and strengthening Rosstat’s institutional independence from executive bodies. The fund also notes poor information on the long-term obligations of the state through public-private partnerships (PPPs), of which there are about 2.5 thousand. The total cost of PPP projects is estimated by the IMF at 2.2% of GDP in 2017. The IMF recommends the publication of annual assessments of such commitments.

There are six state-owned corporations in Russia, the largest being VEB.RF, Rostec, Rosatom, and Roskosmos. S&P Global Ratings recently called VEB the “quasi-budgetary unit” of the government. The Ministry of Finance does not explain why it was decided to include only state corporations in the budget reporting.

Among the aspects of fiscal policy that require increased openness, the IMF highlights the opacity of spending on national projects and a large share of classified federal budget items. The share of closed budget expenditures on national defense and security increased from 10% in 2010 to 17% in 2018, the fund indicates.