Russian Budget: A Surplus of Fantasy

By Tony Karon Friday, Jan. 15, 1999
  • Share
  • Read Later
Economics is always an inexact science, but Russian economics is about as realistic as SimCity. Prime Minister Yevgeny Primakov spent Friday bullying regional governors to adopt his budget, but their skepticism pales against that of the IMF. "The Russian budget is an exercise in virtual reality, with a large blank they're assuming will be filled by the IMF," says TIME Moscow bureau chief Paul Quinn-Judge. "Everything hinges on receiving a massive chunk of aid, but the IMF is unimpressed by this exercise in wishful thinking."

To coax the IMF into paying up, Primakov will try to scare them with images of a cataclysmic economic meltdown. But that may no longer work. "The IMF knows it's unlikely ever to find the kind of money that would be needed to pull Russia out of the hole," says Quinn-Judge. And with Moscow showing no sign of undertaking the structural reforms demanded as a condition for IMF aid, it's not inclined to throw good money after bad. Which may leave Primakov to make up his budget shortfall at the Xerox machine.