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Strategies & Market Trends : Investment in Russia and Eastern Europe -- Ignore unavailable to you. Want to Upgrade?

To: Real Man who wrote (367)	7/21/1998 3:15:00 AM
From: Real Man	Read Replies (1) \| Respond to of 1301

WASHINGTON, July 20 (AFP) - The IMF executive board on Monday approved financial assistance for Russia worth 11.2 billion dollars, of which 4.8 billion dollars will be available immediately, the Fund announced here in a statement. "The International Monetary Fund has approved financial support totaling 11.2 billion dollars for the Russian Federation," the statement said. It added that "about 4.8 billion dollars is available immediately." About 8.3 billion dollars in the IMF bailout will be used to support the government's economic program for 1998, with 2.9 billion dollars earmarked to compensate a shortfall in export earnings. The Fund had planned to released a first installment of 5.6 billion dollars. But that amount was scaled back to 4.8 billion because the Russian parliament failed to approve laws reforming personal income tax procedures as well as measures to bolster the finances of the pension fund, according to IMF Deputy Managing Director Stanley Fischer. "I welcome the government's intention to seek parliamentary approval of measures in these areas in a special parliamentary session scheduled for August," Fischer said. He added that the amount by which the first tranche was reduced, about 800 million dollars, was likely to be made available in September, "assuming that the measures are satisfactorily implemented in the future." Fischer nonetheless hailed action taken by the Russian government and parliament in the last few days as "a solid basis for a fundamental improvement in Russia's fiscal position and a revitalization of structural reforms." The reform program had been sought by the IMF in exchange for its assistance in helping Moscow cope with a weakening currency and improve the operations of its tax collection and banking systems. "The government will need to ensure full implementation of the policies envisaged in the program and its associated legislation," Fischer warned. "Weakness in implementation has been the Achilles heel of Russia's economic policies in the past." Russia earlier this month secured an overall aid package arranged by the IMF worth 22.6 billion dollars, with the World Bank and Japan joining the Fund in the effort to salvage the Russian financial system.