National projects had to be extended due to coronavirus

The national projects will be changed and partially extended until 2030. The decision, released a couple of weeks after the vote on constitutional amendments giving the president the opportunity to run for another two terms, but it has more economics than politics: the coronavirus crisis has made the initial parameters impossible.

What happened

The day before, at the Council for Strategic Development and National Projects, Vladimir Putin proposed adjusting the national projects within three months. Now the goals of national projects until 2024 are spelled out in the May 2018 decree. The President presented the extension as an extension of the 2030 planning horizon.

The government and presidential administration should prepare a draft presidential decree in September 2020, and by October 30, the government must determine how to achieve the set goals, writes . Kommersant

There are no specifics yet, but among the changes are additional investments in the healthcare system, new investments in education, resolution of environmental problems, employment stimulation and widespread digitalization.

What you need to know about new national projects

Such a shift is the recognition of the impossibility of plans agreed before the coronavirus to spend 25.7 trillion rubles on accelerating economic growth until 2024, writes Forbes.

Due to the oil and coronavirus crisis, Russia has lost at least a year of economic growth, Anton Tabakh, chief economist at Expert RA, told Forbes. In terms of household incomes, the rollback is even stronger: by the end of the year they will be 15% lower than in 2013, says Natalia Orlova, chief economist at Alfa Bank. Closing this gap even by 2030 will be very difficult, she said.

Before the pandemic, it was assumed that national projects would launch investment growth, accelerate the growth of household incomes and add 0.6-0.8 percentage points. to annual GDP growth. Now part of the budget expenditures are aimed at compensating for the reduction in real incomes of the population.

For some of the national projects, the transfer of goals has already been announced. Thus, according to the "Digital Economy", access of 97% of households to broadband Internet is assigned to 2030 instead of 2024, and to achieve the commissioning of 120 million square meters. m of housing per year is possible only by 2026-2027.

What's next

In the coming years, the authorities will focus on mitigating the collapse in household incomes, and will not return to investment until 2022, Forbes experts say. National projects will fade into the background for now, giving way to the government's plan to support the economy - which, however, is rather stingy.

What is happening symbolizes the end of the "transitional period" between prime ministers Dmitry Medvedev and Mikhail Mishustin, Kommersant believes. The new government receives its own medium and long-term work priorities and two action plans until 2022 and until 2024.

The operation of the mechanisms of national projects has been extended until 2030, and this cannot be considered optimal. An anti-crisis mechanism, by definition, should not be a source of growth in the post-crisis period, but it will nevertheless be extended over ten years.

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