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. Last Updated: 07/27/2016

A Look Inside the Russian Aid Proposals

President Boris Yeltsin returned to Russia on Monday with promises of nearly $2 billion in aid from the U. S. , Britain and Canada, as well as $15 billion in debt rescheduling.


Though the $1. 6 billion U. S. aid package dwarfed the offers of Britain and Canada, a substantial proportion of the U. S. funding is old aid recycled.


Most of the $159 million in Canadian aid and $180 million in British aid, announced Friday, will go toward training and assisting Russians in their transition to a market economy, embassy officials said.


Neither Japan nor Germany, which has already given more than half of Russia's foreign aid, came forward with new aid packages.


Though Japan has committed $2. 8 billion in aid to Russia, the bulk of the assistance is held up in the dispute over ownership of the Kuril Islands.


Of the $1. 6 billion in aid that U. S. President Bill Clinton pledged, more than $600 million is actually old aid -- including $215 million that was allocated last year to help Russia, Ukraine, Belarus and Kazakhstan dismantle nuclear weapons. The largest single part of the U. S. assistance will be in the form of credits for purchases of grain. It comes at a cost to Russia, since 75 percent of the grain must be shipped in U. S. freighters at higher rates than Russian ships would charge.


A deputy chairman of the parliamentary economics committee said in an interview Monday that these credits would offer welcome relief to Russia's troubled agricultural sector.


Another $82 million will be loaned to Russia to finance the sale of Caterpillar Inc. construction machinery to Gazprom, the Russian state gas agency. The Polar Lights oil development project, part of DuPont Conoco Inc. , has been granted $100 million in insurance coverage, as well as a $50-million guarantee, Reuters reported.


British Foreign Secretary Douglas Hurd announced Friday that Britain would increase spending on bilateral assistance by $90 million, mostly through the British Know-How Fund for assistance projects in Russia.


Since 1990, the Know-How Fund has provided about $150 million for training and assistance projects in privatization, finance, energy and agriculture in the former Soviet Union.


Of the $159 million in Canadian aid, two-thirds will be allocated for the Technical Assistance Program. The program will fund training for engineers in the oil and gas sector and business courses for young Russian managers at a Canadian university.


An additional $8 million is to be spent to encourage joint ventures with Canadian companies. Canada also promised some humanitarian aid and offered a $24-million credit line for the purchase of Canadian medical, health and educational equipment and services for Russia's young people.