January 24, 2008 |
|For the first time, Ministry of Economic Growth and Trade anti-inflationary measures include monitoring of the state sector of the economy. A draft plan proposes that state companies' borrowing be monitored as one of 24 measures to contain consumer price growth this year. The plan been conciliated with the Finance Ministry and was submitted to the government on January 18. The Economics Ministry estimates that the consumer price index will rise 1.9-2 percent this month, which already jeopardizes it hopes for 6-7 percent inflation this year.|
Similar proposals were made in November of last year. At that time, Russian Prime Minister Viktor Zubkov sent them back for further development after Finance Minister Alexey Kudrin objected to them. Now the 24 measures include market and price controls, as well as monetary and credit policy suggestions, including debt monitoring for state companies, which Kudrin had pressed for all last year. According to Central Bank data, Russia's foreign debt grew by $120.3 billion, that is, by 38.7 percent, to $430.9 billion, between January and the end of October of last year.
Early repayment has reduced the debt of state agencies to $39.6 billion, but the foreign debt of private and state-controlled companies and banks grew significantly. The debt of state-controlled companies rose fastest of all, by 64.4 percent to $73.5 billion, in the first nine months of the year. Loans to Rosneft and Gazprom accounted for the largest portion of that amount. Non-state-controlled companies' debt rose 35.3 percent, to $156.9 billion. The foreign debt of state banks rose 43 percent to $59.2 billion. Non-state banks' debt rose 48 percent to $88.5 billion.
Theoretically, the monitoring of state companies and banks could turn into control over their foreign financial dealings by the Finance Ministry, to the point of denying them foreign loans, although there is as yet no mechanism for exercising that control.