IMF Talks Prolonged, Progressing

A delegation from the International Monetary Fund has prolonged its stay in Moscow to hammer out the details of an economic program that could pave the way for a crucial multibillion-dollar loan, a source close to the talks said Friday.


The IMF delegation, which arrived two weeks ago to discuss conditions under which Russia could receive a $6.4 billion standby loan to finance its budget deficit, had earlier been expected to wind up talks with a Russian government team by Friday.


But the source said the negotiations were making progress, and the IMF team was likely to stay until the fine points of the program had been agreed.


"However long these talks take, the view is to resolve all the technical points," the source said, adding that "some small problems" remain. He declined to discuss what these were. He added that the biggest difficulty would be convincing the IMF that Russia would stick to any plan that is agreed.


Last Wednesday, a Finance Ministry official had described the talks as "deadlocked," citing IMF skepticism that Russia could maintain a commitment not to use inflationary Central Bank credits to finance its budget deficit.


But a Finance Ministry official later said that First Deputy Prime Minister Anatoly Chubais had agreed on the "political aspects" of the deal with IMF Deputy Managing Director Stanley Fisher in talks in the Swiss resort of Davos and that an agreement could come as early as next Thursday.


Attention will turn to Toronto this weekend when a meeting of finance ministers and central bankers from the Group of Seven leading industrial nations is expected to discuss the loan.


German Finance Minister Theo Waigel said Friday that the G-7 will urge Russia to affirm its commitment to democratic reforms despite the conflict in Chechnya


"We will appeal to Russia not to depart from the path of democracy," he told German television, Reuters reported. "The events in Chechnya have started a very controversial and very negative discussion. We want the economic process to continue."