COVID-19: Russian government drafts plan to support economy amid coronavirus spread - Vedomosti

The government will come up with a plan to support Russia’s economy, which is expected to be approved this week, Vedomosti writes citing two federal officials. It provides for the creation of a fund of 300 bln rubles ($4.1 bln), tax breaks for businesses and paid sick leave for quarantined individuals.

The government suggests supporting businesses, regions and state-run companies, but taking care of the population is a top-priority issue. Plans are also in store to monitor the labor market situation in order to prevent any rise in unemployment.

To stop the spread of the epidemic, government officials propose providing the necessary materials for the production of test systems to detect the infection, the draft anti-crisis plan says. That’s the document’s core value, the paper quotes Alexandra Suslina of the Economic Expert Group as saying. Until a full-scale epidemiological assessment is carried out, all measures will be inaccurate and will not work to their fullest.

For his part, Professor of the New Economic School Oleg Shibanov described the proposed measures as useful and proportionate. He noted though that some of these steps, such as tax cuts, investment support measures and regional issues could not solve the problem quickly.

The attempt to help businesses and the public overcome the crisis will not compensate for all the losses, warned BCS Global Markets Chief Economist Vladimir Tikhomirov. If the situation evolves along the lines of a worst-case scenario, the government will have to come up with additional measures and earmark more funds. It may also have to cut costs to compensate for anti-crisis measures, he added.

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