Many leading economies worldwide have finally overcome the recession caused by the pandemic, and the world is gradually emerging from the global economic crisis caused by the lockdown. Meanwhile, with the new economic paradigm come new challenges. These topics were discussed by the participants of the “Macroeconomic Policy after the Pandemic” session, which was part of the second day of the Gaidar Forum-2022 at the Russian Presidential Academy of National Economy and Public Administration.
The session was attended by Maxim Oreshkin, aide to the President of the Russian Federation, James Kenneth Galbraith, professor at the University of Texas at Austin (USA), and Kenneth Rogoff, professor of economics at Harvard University. Pavel Trunin, Director of the Center for Central Banking Studies, RANEPA, was the moderator.
Maxim Oreshkin noted that the Russian government took extraordinary measures and stimulus spending to support the population and the economy during the COVID-19 pandemic crisis, which helped curb unemployment. But now, in the presidential aide’s opinion, Russia’s budget policy is back to normal. “We have a surplus budget in 2021. Russia is back to a balanced fiscal situation,” he said.
In addition, Oreshkin spoke out on the issues of lending. “My opinion is that given the normalization in fiscal policy, considering the monetary policy actions that have already been taken, lending will go down, and all together this will ensure that the inflationary situation will be relieved and stabilized,” he said.
Kenneth Rogoff noted that Russia had more margin for maneuver in terms of monetary policy than many other countries, and it managed to take advantage of its position to reduce the impact of the coronavirus crisis.
The Harvard professor also emphasized that now it is vital for economies to preserve jobs and wellbeing, and therefore to focus on reducing social inequality. Maxim Oreshkin also believes that this problem remains fundamental and must be addressed as a priority. “Inflation is not the most important thing we have to talk about. The problem of global inequality is much more important and relevant. And the inflation of assets is largely a consequence of the inequality that has developed in society,” he summarized.