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. Last Updated: 07/27/2016

IMF Seen Granting Next Credit

An International Monetary Fund team is generally satisfied with Russia's progress under a $10 billion loan deal and is expected to recommend the release of the credit's next tranche, officials close to the talks said Monday.


The mission is expected to leave Moscow on Tuesday to report back to IMF headquarters in Washington. Russian officials said they hope the IMF board will vote to make the next disbursement by Sept. 10.


Last week, the Fund approved the previous tranche, which had been delayed for several weeks due to concerns about a catastrophic fall in government revenues. Only after the government put together an emergency plan to boost income did the Fund release the money.


Under the three-year loan deal, reached last March, the IMF checks on Russia's performance monthly, releasing money only if key monetary and budget targets have been met.


A Western official close to the talks noted that while Russia has missed deadlines on many structural reforms, "we get the sense that work on this has accelerated recently."


As a result, the mission is "reasonably positive" about Russia's overall performance, he said on condition of anonymity.


The loan program calls for aggressive steps to privatize state property, stimulate land reform and stabilize Russia's shaky banking system.


So far, the most notable progress has come in the banking sector, where the Central Bank has moved actively to tighten regulation and limit the damage from a continuing shake-out.


But privatization and agricultural reform have largely been stalled in the charged political environment surrounding the June presidential elections. The government has drawn up ambitious plans for the fall to sell off state property and stimulate restructuring in the largely unreformed farm sector.