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Wednesday, 13 June, 2001, 11:34 GMT 12:34 UK
IMF mission arrives in Moscow
Russians in queue
The IMF should be happy with some of Russia's reforms
An International Monetary Fund (IMF) mission arrives in Russia on Wednesday, to assess the progress of economic reform, which might pave the way for future loans.

The mission members, led by Gerard Belanger, will have meetings with Alexei Kudrin, Vice-Premier and Minister of Finance, and other members of the Russian government.

Sustained economic growth is not possible without decisive acceleration of structural reforms

Alexei Kudrin, Finance Minister

In October last year, the IMF suspended its existing programme of loans because of the Russian government's delay in implementing reforms and continuing worries about corruption.

Earlier this year, Russia declined to enter into further negotiations with the IMF. Russia's bargaining position is strengthened by the strong price of oil, which lessens its dependency on IMF money.

It nonetheless chose to renegotiate its commercial debt with the Paris Club.

Russia has sought to develop a modern market economy since the financial crisis of 1998, which rendered many banks insolvent, saw Russia default on its domestic debt and resulted in the devaluation of the rouble.

Last year, President Vladimir Putin introduced a radical programme of reforms including a shake-up of the tax system, simplified business procedures and a fight against corruption and money laundering.

Even finance minister Alexei Kudrin has admitted that reform is necessary.

Denis Rodionov of Brunswick Securities in Moscow, told BBC News Online that the IMF would be pleased to see that overall, most of the reforms were moving forward - particularly on taxation.

However, Mr Rodionov also said that there were two areas that will disappoint the IMF:

  • Restructuring of Gazprom, the state-run gas company, has been delayed until after the autumn
  • Reform of the banking sector has faced problems as the Central Bank has been reluctant to move in a new direction.

One issue likely to be on the agenda is Russia's role at next month's G8 summit, the annual meeting of heads from the seven leading industrial nations of the world plus Russia.

The next meeting of the G8 group is in Geneva on 20 July.

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28 Mar 01 | Business
Russia rejects IMF loan
21 Nov 00 | Business
IMF: No deal with Russia
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