Germany takes hard line on Russian debt

By Vladimir Radyuhin

MOSCOW, JAN. 8. Germany, Russia's main creditor, has reiterated its opposition to a partial write-off or restructuring of multi- billion Russian debts to the West.

Russia has enough economic strength to service its debts in full, the NTV television quoted the German Chancellor, Mr. Gerhard Schroeder, as saying at the end of an unofficial visit to Moscow for talks with the Russian President, Mr. Vladimir Putin.

For its part, Moscow insists that repayment of its $ 160-billion- odd debts to the West could ruin its economy. A senior Government official said last week that Russia would press for a partial write-off of its $ 48-billion debt to the Paris Club or creditors. Russia has announced that it is unilaterally delaying payment of the next tranche of $ 3.5 billion, pending talks with the Paris Club. Germany's stand on the issue of debt relief is essential considering that Moscow owes Bonn about 40 per cent of its Soviet-era debt to the Paris Club.

Mr. Putin had invited the German leader and his wife to Moscow for the Russian Christmas, celebrated on Jan. 7, to try and soften Bonn's hard line. However, despite a very warm reception, which included a traditional ride on a troika sleigh, a ballet at the Bolshoi Theatre and a midnight Christmas mass, Mr. Schroeder remained unrelenting.

When translated from diplomatic into normal language, Mr. Schroeder's statement means that Germany rules out any restructuring, let alone writing off, of Soviet debts, NTV said.

Mr. Putin admitted his failure to sway Mr. Schroeder, quoting his German guest as saying: ``Business is business and friendship is friendship.''

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Section  : International
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