The city of Moscow will end up spending a total of 250 billion rubles ($3.1 billion) on fighting the coronavirus outbreak but will lose double that amount in revenue, Mayor Sergei Sobyanin said Thursday.
The epicenter of Russia’s outbreak with over 40% of its 441,108 cases, Moscow allowed shops to reopen and residents to leave homes for short walks from Monday after nine weeks in lockdown. Combined with a sharp fall in oil prices, the lockdown measures that Sobyanin has extended until June 14 have badly hit Moscow’s and Russia’s economy.
“According to preliminary estimates, the city has spent and will continue to spend a quarter-trillion rubles on problems related to the pandemic,” Sobyanin told the state-run TASS news agency.
“City budget revenues will lose another half a trillion [rubles],” the mayor said.
His economic deputy previously placed the overall losses at 600 billion rubles with a 7% drop in revenue.
Before the coronavirus outbreak battered the economy, Moscow’s revenues were due to total 2.8 trillion rubles and expenditures 3.15 trillion rubles.
In the TASS interview, Sobyanin forecast the end of the outbreak by mid-2021 but warned that masks could remain mandatory until next February.
Russia’s prime minister introduced a 5-trillion-ruble ($73 billion) recovery plan due to be put into action in July to offset economic damage from the pandemic.
The package — envisioning “stabilization” by the end of the year, “recovery” by mid-2021 and growth starting in late 2021 — is the largest yet announced by the Kremlin. It had faced criticism for steering clear of more ambitious spending plans.