Putin assumes direct control over Wealth Fund allocation • Медуза • RIMA — архив российских независимых медиа

Putin assumes direct control over Wealth Fund allocation

As of now, funds from the Russia's sovereign National Wealth Fund will be allocated only after direct approval from President Vladimir Putin. Before, to use funds from this source it was enough to gain the approval of the government, which is comprised of the Prime Minister, the deputy prime ministers, and federal ministers of Russia.

At the meeting with the president it was decided to invest about 600 billion rubles ($9.7 billion) in various projects, while all additional spending will be approved by Putin from now on.

An administration official told RBC that in the middle of last year, the sum of applications for funding fro the National Wealth Fund was higher than the sum of money available in the Fund. From those applications, the government selected to fund projects amounting to 800 billion rubles ($12.9 billion). But sanctions, the collapse of the ruble and falling oil prices have compromised the federal budget.

RBC

The Russian National Wealth Fund is the sovereign wealth fund of Russia which is controlled by the Russian Ministry of Finance. Most of the fund is comprised of foreign securities. The Fund is responsible for supporting the Russian pension system, but officials have been using it for other purposes as well. The aggregate amount of money in the National Wealth Fund is about 4.59 trillion rubles ($74 billion).
When Russia entered the economic crisis, several companies applied for aid from the National Wealth Fund. Deputy Prime Minister Arkady Dvorkovich warned in 2014 that there are “definitely not enough funds to go around.”
Rosneft, the largely government-owned leader of Russia’s oil industry, has been trying to get funds from the National Wealth Fund for its investment projects since 2014. The company’s initial application asked for more money than the Fund had. It was later cut back. At the end of February, it was announced that Rosneft would get a total of 300 billion rubles ($4.9 billion) worth of financing for five of its projects.