[an error occurred while processing this directive]
BBC News
watch One-Minute World News
Last Updated: Monday, 21 August 2006, 11:55 GMT 12:55 UK
Russia pays off Paris Club debts
Priobskoye oil field in western Siberia
Russia's enormous energy wealth is improving its public finances
Russia has finished paying off its $22.5bn (12.4bn) Soviet-era debt to the Paris Club of international sovereign creditors ahead of schedule.

Its huge oil and gas wealth has allowed it to fast-track the repayments, and this has saved $7.7bn servicing costs.

Moscow also agreed to pay a $1bn premium to certain creditors in compensation for lost interest.

Some, including Germany, had objected to Russia repaying its debt in one lump sum because they would miss out.

The move will cut the debt burden inherited by Russia from the Soviet Union by more than 90% to $3bn.

The Paris Club consists of 19 members including the US, UK, France and Japan.

A default on the debt, built up during the life of the Soviet Union, triggered a Russian financial crisis in 1998.

Earlier, economists said the move would boost Russia's sovereign credit rating, which could help attract inward investment.

G8 ministers voice oil price fear
09 Jun 06 |  Business
Russia to repay its debts early
23 Jun 06 |  Business
Profile: G8
04 May 06 |  Country profiles
Russia 'may cancel African debt'
07 Feb 06 |  Business
G8 Moscow talks focus on energy
11 Feb 06 |  Business
Russia: Energy overview
13 Feb 06 |  Europe

The BBC is not responsible for the content of external internet sites

Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit


Americas Africa Europe Middle East South Asia Asia Pacific