ST PETERBURG, Russia Russia's Finance Minister Alexei Kudrin called on the European Union on Saturday to make a clear commitment to a common economic policy that would aid debt-ridden countries and keep the euro zone crisis from spreading.
"The European Union should focus on saving its countries. Weakness and giving up on someone will create additional risks," Kudrin said while attending a conference on Russia's reforms in St. Petersburg.
"Perhaps the price is great, but if we don't (save the countries) we will be faced with a greater crisis, which will detonate in other countries, including ours."
Russia, the holder of the world's third largest gold and foreign reserves, boasts a healthy sovereign balance sheet, with debt level below many developed countries.
But its stock markets lost nearly a fifth of their value in the recent wave of global market turmoil, the rouble has weakened and yields on sovereign bonds fell to 2011 lows.
Friday's departure of the European Central Bank chief economist Jürgen Stark increased worries of about the euro zone euro zone financial crisis and spread fears and that European leaders will not be able to prevent further debt problems in Greece, Italy and Spain.
TOUGHGER DOMESTIC FISCAL POLICY NEEDED
Thanks to high crude prices, Russia, the world's top energy producer, will be able to balance its budget this year, but it will return to carrying a hole for the next three years, according to a newly revised budget plan.
And only if crude prices remains above $100 a barrel in 2015, the deficit will disappear.
For Kudrin, the longest serving Finance Minister in the Group of Eight industrialized countries, the high break-even oil price is a failure.
"Even with $100 a barrel we will have a small deficit and we need a much tougher policy," he said.
"But those are the challenges of a pre-election period and of course, if something happens, they will be looking for a scapegoat."
Russia's parliamentary elections will take place in December, while presidential elections will be held in March. Both President Dmitry Medvedev and Prime Minister Vladimir Putin are yet to declare their intentions.
(Writing by Lidia Kelly; Editing by Toby Chopra)