Falling incomes, rising unemployment, but no disasters Putin’s speech at the 2021 St. Petersburg International Economic Forum, in brief
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Speaking at the 2021 St. Petersburg International Economic Forum on June 4, President Vladimir Putin sang the praises of Russia’s coronavirus vaccine, addressed rising unemployment and falling incomes in Russia, and denied claims that Russia isn’t concerned about climate change. Meduza summarizes his speech, in brief.
The global economy is recovering, but there are risks to general security. Vaccination is one example. Today, high income countries (16 percent of the world’s population) are receiving half of all vaccines, whereas hundreds of millions of people don’t have access to them — it’s every man for himself. Every adult Russian can get vaccinated for free. The Russian vaccine is the safest and most effective, and there hasn’t been a single fatality. I experienced it myself: I had a low-grade fever, but it offers such good protection! We need to organize paid vaccination for foreigners in Russia by the end of June. The first pipe string of the Nord Stream 2 pipeline was completed today: the pipes just need to be lifted up and welded. A few words about domestic affairs. In Russia, unemployment rose, incomes fell, but no disasters took place. I propose extending the preferential mortgage program for another year — until July 1, 2022, and extend family mortgages to families with at least one child. Already this year, we began issuing loans to small- and medium-sized businesses under SME Corporation guarantees — this will allow entrepreneurs to attract 600 million rubles [approximately $8.2 million] by 2024. They say that Russia isn’t very interested in resolving the problem of global warming. That’s nonsense! We need to build up the forests and invest in their protection in order to improve the well-being of the environment. We are very concerned about this.
This is a rough summary of Vladimir Putin’s speech at the 2021 SPIEF. First person statements aren’t necessarily verbatim quotes.
Cover photo: Sergey Bobylev / TASS
(1) Real incomes in Russia
According to the state statistics agency, Rosstat, real disposable income in Russia (that is, the post tax and benefit income available to households, adjusted according to the consumer price index) fell by 3.6 percent in the first quarter of 2021, compared to the first quarter of 2020. According to Rosstat data, incomes fell 3 percent in Russia last year (and not 3.5 percent as was initially reported).
(2) The preferential mortgage program
Launched in April 2020, this program initially provided access to loans at an annual interest rate of 6.5 percent for the purchase of new apartments worth up to 12 million rubles (about $164,500) in Moscow, the Moscow region, St. Petersburg and the Leningrad region and new apartments worth up to 6 million rubles (about $82,250) in other Russian regions. The program required a 15 percent down payment. At Putin’s suggestion, the future interest rate on preferential mortgages will be 7 percent and the amount will be lowered to three million rubles ($41,130).
(3) Family mortgages
Launched in 2018, this program initially allowed families with two or more children to access loans at a 6 percent annual interest rate. The maximum housing cost was 12 million rubles (about $164,500) in Moscow, the Moscow region, St. Petersburg and the Leningrad region, and 6 million rubles (about $82,250) in other Russian regions. This also required a 20 percent down payment. At Putin’s suggestion, the program will be extended to families with at least one child born after January 1, 2018, and the interest rate will be raised to 6.5 percent per annum.