Saturday, August 15, 1998 Published at 00:03 GMT 01:03 UK
Business: The Economy
Clinton urges Russian reform
The United States President Bill Clinton has telephoned his Russian counterpart, Boris Yeltsin, to discuss the economic crisis in Russia.
An American official said Mr Clinton urged Mr Yeltsin to take decisive steps within the next few days in order to reassure the financial markets and improve prospects for the release of the next instalment of a multi-billion dollar loan from the International Monetary Fund.
"It was a phone call about doing the things necessary to right an economy that has been struggling to move forward."
Another US official, who asked not to be identified, said that President Clinton felt that the onus was on Moscow to take further action on its economy, rather than on the West to provide more cash.
The two presidents spoke for 40 minutes at the end of a week of wild gyrations in Russia's markets.
On Thursday, trading on the Moscow stock exchange had to be suspended after share prices lost more than 11% within one hour.
Traders reacted to comments by a US official who said that the G7, the world's seven richest countries, had not given up on Russia yet.
The leading Russian Trading System (RTS) index finished 13.67% up on Thursday's close and well clear of the two-year lows set with alarming regularity earlier in the week.
Mr Soros, one of the world's most influential investors, wants the rouble to be pegged to the US dollar or a European currency.
In a letter to the Financial Times newspaper, he also called on G7 to provide a further $15bn to shore up confidence in the country's troubled financial system.
He believes that the best way to resolve the crisis is for a 15-25% devaluation of the rouble and the setting up of a currency board.
Crisis despite bail-out
Russia's economic turmoil comes despite the promise of a $22bn financial bail-out lead by the International Monetary Fund.
Russian shares have collapsed in recent months amid fears that the government will struggle to pay off its debts.
The government has some $20bn in short-term debt that must be redeemed by the end of the year. It has been finding it difficult to collect taxes, especially from the energy companies whose profits have been hit by the fall in the oil price.
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