State to support failing companies only in exceptional cases - Russian minister
RIA-Novosti
Moscow, 29 September: From now on, the state will provide support to inefficient enterprises only in exceptional cases and on condition of their compulsory restructuring, Russian First Deputy Prime Minister and Finance Minister Aleksey Kudrin told journalists on Tuesday (29 September) on the fringes of the Russia Calling forum.
Replying to a question about why the state was spending "trillions of roubles" to support inefficient enterprises, he said state support "amounts not to trillions but to R200bn (6.6bn dollars), without taking banks into account, and half of this money goes to the energy industry". The amount, according to Kudrin, is not that significant on the scale of the Russian economy.
On the other hand, the finance minister admitted, budget infusions go to "enterprises whose efficiency we have not yet improved". As an example Kudrin mentioned Avtovaz, which has not succeeded in its restructuring but at the same time is socially important.
"From now on state support will be strictly linked to further restructuring of companies. Our assistance should be limited and targeted," the finance minister continued.
He agreed that the state should support such enterprises only in exceptional cases when the enterprises in question are socially important or are the main employer in a town.
"In other cases the market should give its own assessment to such enterprises," the deputy prime minister said. In particular, according to him, this might include bankruptcy.
