MOSCOW (Reuters) - Russian lawmakers on Tuesday cleared the government to raise state borrowing this year beyond budgeted limits, as the country scales up its crisis response to the coronavirus epidemic.
The economy is on the brink of recession as Russia battles the twin shocks of a crash in the price of oil - one of its key exports - to an 18-year low and the rapid depreciation of the rouble.
Broader business activity is taking a hit from a partial lockdown enforced to stem the outbreak. The number of cases jumped by 500 to 2,337 on Tuesday, with 17 deaths, authorities said.
President Vladimir Putin has praised Russia’s traditionally low public debt levels as an economic strength. But the lower house of parliament, or Duma, voted to allow the government to exceed its borrowing ceilings on both domestic and external bond markets next year.
Before the coronavirus-driven global market selloff sliced more than 20% off the rouble’s value, the finance ministry had planned to borrow 2.3 trillion roubles in OFZ rouble-denominated bonds and up to $3 billion in Eurobonds in 2020.
The respective ceilings for outstanding debt this year had been set at 12.98 trillion roubles and at $64.6 billion and 56.4 billion euros for hard-currency bonds.
The Duma also approved sales of precious metals and gems from state coffers to cover budget needs, beyond a previous limit of 6.5 billion roubles ($83 million), and freed regional authority budgets from the need to repay loans in 2020, which could save an estimated 78 billion roubles.
Russian regional governments rely heavily on tax revenue from sectors that are most exposed to the effects of the coronavirus outbreak, rating agency Moody’s said this month.
($1 = 78.4853 roubles)
Reporting by Andrey Ostroukh and Darya Korsunskaya
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