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. Last Updated: 07/27/2016

Russia Asks Korea for Debt Relief

Russia is asking South Korea for talks on rescheduling the repayment of $1. 47 million in owes to Seoul, South Korean officials have said.

Officials at the Finance Ministry said Thursday that they have not decided how to respond to the Russian request, made recently through the South Korean Embassy in Moscow.

One official, speaking on condition of anonymity, said Russia wants to hold the first such meeting this fall.

In 1990, when it was opening formal relations with the former Soviet Union, South Korea promised to lend Moscow $3 billion.

When Moscow failed to make interest payments, South Korea suspended the loan package in 1991 after providing $1. 47 billion.

The amount disbursed to the former Soviet Union included $1 billion in cash and $470 million in loans for imports of Korean industrial and consumer goods.

By this year's end, Russia is to pay back $257 million of the principal plus $104 million in interest.

Russia has paid $19. 3 million in interest for the $470 million tied loans. On the $1 billion cash loan, Russia shipped aluminum ingots in June to cover $12. 4 million in interest payments.

Korean critics denounced the government's decision to extend the soft loans, saying it was as an attempt to "buy" recognition from what was then an ally of Seoul's arch-foe, Stalinist North Korea.