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. Last Updated: 07/27/2016

Exporters Get $500M Guarantee

The government on Tuesday pledged to help exporters of finished industrial products increase foreign sales and become more competitive in international markets.

Deputy Prime Minister Boris Alyoshin told journalists that Russian exporters would receive $500 million in export guarantees in 2004 along with $50 million in guaranteed credits.

"This will allow exports of [finished] industrial products to increase by $2 billion in 2004," he said.

Since the collapse of communism Russia has been unable to maximize export revenues because it sells mainly unfinished goods or raw materials abroad instead of more profitable finished machine goods, and building and transport materials.

Exporters of such finished goods have suffered in the past because they have been unable to obtain long-term financing.

Prime Minister Mikhail Kasyanov said on television that finished industrial production account for only 10 percent of Russian exports, or $10 billion.

"That is a very small part of the structure of our exports. The rest are metals, chemicals and half of them are raw materials," he said on Rossia.

"Unfortunately the structure of exports is not changing and one of the goals of our program of development is to change the structure," he added.

Alyoshin said Russia was mainly interested in expanding sales to countries without investment ratings, including the Commonwealth of Independent States, Cyprus, Mongolia and China.

The Finance Ministry will take the final decision on the guarantees.

The Economic Development and Trade Ministry said that the nation's trade surplus grew 38 percent in the first half of the year to $28.5 billion.

Exports climbed 28 percent to $61.2 billion, boosted by rising prices for oil and metals. The average price of Brent crude oil, the benchmark oil for Russian exports, rose 19 percent in the first six months from the year-ago period.

The country's imports increased 21 percent to $32.7 billion, fueled by economic growth and after the ruble advanced against the dollar, the ministry said.

(Reuters, Bloomberg)