The IMF has to increase borrowing up to 1 trillion rubles.

Net borrowing of the Ministry of Finance on the domestic market in 2017 could increase three times — up to 1 trillion rubles, said Finance Minister Anton Siluanov said Friday in an interview . In such a scenario banks — buyers OFZ could force the Finance Ministry to place a “short” paper, it is fraught with the risk of “slip” to the GKO pyramid, as it was in 1990-ies, warned Siluanov.

This year the amount of net borrowing (attracting of new securities minus repayment of old) is projected at 300 billion rubles.

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“Next year it could rise to a trillion and more, the question is — how will this affect the market?”, — said Siluanov. “Not all the banks in such large borrowing would be willing to invest in 10-year and 15-year bonds of the state. Say: “based on our capital, risk-based is preferable for us short of paper.” And the risk that we may be headed to t-bills — as it was some time ago — also is one of the key risks and factors, why are we talking about the need to reduce the budget deficit,” — said the Minister.

Siluanov not the first time warned of the dangers of debt financing of the budget deficit. Yesterday, speaking at a session of the St. Petersburg economic forum, the Minister said that the Finance Ministry does not want to spend the Reserve Fund to zero and will “gradually” to increase borrowing in the domestic market. But steady increase of public debt is not the answer, as it could lead to the unwinding of the “debt spiral,” said the Minister.

conducts online broadcast of the St. Petersburg economic forum