ACRA confirmed the credit rating of Tyumen Region at the level of AAA(RU), with Stable forecast.
This credit rating of Tyumen Region is due to high indicators of regional economic development, minimal debt burden and high levels of budget liquidity. The rating indicator has been supported by high flexibility of the budget (coupled with a large share of capital expenditures financed by the region itself) as well as substantial financial reserves accumulated by the regional budget.
The economy of Tyumen Region is characterized by a high level of GRP per capita. In 2016–2019, the average value of this indicator was 1.3 times higher than the average national value.
The economy of Tyumen Region is based on production and processing of hydrocarbons, which provide the largest share of tax revenues. In 2020, however, the share of revenue from the oil refining sector has decreased; a significant share of tax revenues now comes from public sector organizations, scientific and technical activities, the construction industry, wholesale trade, as well as from on-land and pipeline transport.
The deficit execution of the budget is in part due to increase in expenditures with simultaneous decrease in corporate income tax revenues. In 2020, tax and non-tax revenues (hereinafter – NTR) of the regional budget decreased by 26% year on year. The major influencing factor in this development was the 35% decrease in revenues from the corporate income tax. Despite the growth of gratuity revenues (164%), the total revenues of the region decreased by 22%. At the same time expenditures increased by 7%. As a result, by the end of 2020, the budget was executed with a deficit of 27% of NTR, which was financed mainly from the region's liquidity reserves.
Budget expenditures are highly flexible: the average share of capital expenditures in total expenditures (excluding subventions) in 2017–2021 will amount to 27%. The region finances about 95% of its capital expenditures from its own funds, which, according to ACRA, serves as an additional contributing factor for cutting expenditures.
The budget of Tyumen Region is characterized by a high share of its own income in the total income volume (excluding subventions); the average ratio of these indicators in the period from 2017 to 2021 will amount to 96%.
In 2020, the ratio of the region's debt to current income amounted to a minimum of 2%, and as of 01.01.2021, the debt of Tyumen Region stood at the level of RUB 2.8 billion. The cost of servicing the public debt is not burdensome for the regional budget.
As follows from the Law on the Regional Budget, in 2021 the public debt will grow to 21 billion rubles, but the debt burden will remain at a low level and will not affect the credit rating of the region.
Tyumen Region has maintained a significant balance on budget accounts and deposits, which as of 01.03.2021 is many times higher than the total debt and more than three times higher than the average monthly budget expenditures for 2020.
The Stable forecast indicates that it is highly probable that the rating will not change over 12 to 18 months.
The next review of the credit rating and a new forecast on the credit rating is expected within 182 days from the date of publication of the press release by ACRA in accordance with the Calendar of Planned Review and Disclosure of Sovereign Ratings.History of Tyumen Region ratings