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Russia to print billions to pay off its debts

Phil Reeves
Friday 04 September 1998 23:02 BST
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IGNORING BILL Clinton's pleas, delivered in person only three days ago, Russia made clear yesterday it intended to print money to try to avert its hastening economic collapse.

Efforts by Washington and the International Monetary Fund to persuade Moscow to pursue tough monetarist remedies appear to have failed. Instead the country will churn out roubles to pay off its debts, before trying to bring the currency back under control by tying it to foreign reserves.

When Mr Clinton was in Moscow this week, Boris Yeltsin indicated he might have to make some "tactical adjustments", although the US leader urged him to stick by reforms, and to avoid stoking inflation.

Boris Fyodorov, a deputy prime minister, and one of a small coterie of economists heading efforts to salvage Russia from its crisis, made the strategy clear last night: "We will pay just about all the debts that can be paid. Then we will balance the budget."

Whether it is implemented depends on the fate of Russia's unloved acting premier, Viktor Chernomyrdin, who intensifiedhis election campaign by announcing that he would create "an economic dictatorship".

As he laid the plan before the upper house, the Kremlin made a new attempt to secure him in his job by flourishing a power-sharing offer at parliament.

Further report, page 13

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