Business: The Economy
Russian jobless figures 'to
soar'
The number of Russians out of work looks set to soar
As Russia's economic crisis continues to worsen, Prime
Minister Yevgeny Primakov has put a positive face on
the prospect of agreeing a new loan with the International
Monetary Fund (IMF).
Evidence of the worsening crisis came in a government
report that predicted unemployment would rise by
500,000 this year.
The official number of jobless stood at 1.9m at the end of
1998, although government officials have admitted that
the real figures is probably far higher.
The government needs money to pay off its outstanding
debts, but the IMF has been critical of the country's
financial planning and wary of committing more money.
"An IMF tranche in the amount of $4.3bn is very
important to us for refinancing our debt," said Mr
Primakov.
The IMF as good as scrapped a $22.6bn aid package for
Russia after the country's currency, the rouble,
collapsed in August along with financial markets. The
government also defaulted on some of its debt.
An IMF mission to Russia last week made little progress
towards a new loan agreement.
Mr Primakov said he was doing his "best to meet the
IMF half-way when possible, and when we consider it
advisable."
Banks in spotlight
Mr Primakov said his government was paying more
attention to the banking industry, especially since the
Russian government began transferring its budget funds
to state-controlled banks.
Russian banks were shaken
last week by accusations
that the Central Bank had put
the nation's hard-currency
reserves in a virtually
unknown offshore firm and
reaped lucrative profits.
Former Finance Minister
Boris Fyodorov accused the
Central Bank of corruption.
According to the Moscow
Times newspaper, Mr
Fyodorov said the company
was set up by Viktor Gerashchenko, who headed the
Central Bank from 1992 to 1994 and was appointed to
the job again last autumn.
Former prosecutor general Yuri Skuratov said the
company had startup capital of just $1,000 when it
began working with the Central Bank in 1993, but by
1998, it had managed $50bn of Russia's foreign currency
reserves and credits from the International Monetary
Fund.
Mr Skuratov, who resigned a day after submitting the
report, has accused the Central Bank of being
responsible for Russia's financial collapse last August.
Former Central Bank Chairman Sergei Dubinin described
the accusations as "irresponsible" and said the bank
had used the offshore company as a necessary means
of protecting Russia's reserves.
He said no more than $1.4bn had been put into the fund
in a year.
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