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. Last Updated: 07/27/2016

Russia's Appeal to Ease Debt Payment Burden

Russia's coffers are so depleted it cannot even afford to pay reduced debt payments to foreign lenders, and creditors should consider easing the burden, a top economics official said Monday.


Oleg Davydov, minister of foreign trade, said Russia plans to pay creditors about $5 billion this year, while next year's payments are expected to be $6.5 billion.


"The load on our budget linked to debt repayment under the agreements reached with the London and Paris Clubs exceeds the capabilities of our economy today," Davydov said. "The West should think about this."


Davydov told a news conference his views do not reflect those of the government.


He said he was pushing for at least some of the debt to be written off.


"I don't think this question is off the agenda," he said.


A decision could be taken in the next few months, once the 1995 budget is decided. Since the collapse of the Soviet Union, Moscow has avoided seeking debt forgiveness, fearing the effect it may have on Russia's credit rating.


Instead, Russia has sought and won rescheduling deals with official lenders, grouped in the Paris Club, and commercial banks in the London Club. Russia's total debt is about $85 billion, according to official estimates.