Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

U.S. Russia Investment Fund To Increase Lending by $150M

The U.S. Russia Investment Fund said Tuesday that it plans to pump at least $150 million into Russia over the next year and a half as it boosts lending to small and medium-sized business and expands its mortgage program.

But the $440 million fund, set up by the U.S. Congress in 1994 to promote investment here, could invest much more if the economy continues to grow at a rapid clip, fund president and CEO David Jones said.

"It's not so much what we make available but what the demand is," Jones said in a telephone interview. "The economy is the determinant, not us."

The government expects the economy, which grew 7.9 percent in the first quarter according to the State Statistics Committee, to jump 5 percent to 8 percent this year.

"There's been a big increase in demand because the economy is rebounding [from the 1998 financial crisis]," Jones said.

The fund expects to invest $60 million to $70 million in 2000, at least double the $30 million invested here in the October 1998 to October 1999 fiscal year. Officials couldn't give an estimate for the 1999 calendar year. The fund expects $100 million to be invested in 2001.

Well over half of the lending will be spent on businesses and home buyers, while the rest will go toward buying stakes in telecommunications and Internet companies.

About $200 million in stocks and loans has been invested to date. Among the fund's biggest projects are a $31.5 million investment in second-tier television station TV-3 and a $7 million investment in St. Petersburg hotel Nevsky 49.

Mortgages, which the fund started handing out through partner banks in 1999, are expected to account for at least $30 million of the lending this year, said James Cook, the fund's senior vice president. "We'll put out at least $30 million, but it is hard to say because demand is picking up and [disbursements] could be as high as $50 million," he said.

Some $15 million in mortgages have been approved so far this year through partner banks in Moscow, St. Petersburg and on the Far East island of Sakhalin.