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IMF Visit to Moscow to Assess New Government

  • Robert Lyle

Washington, July 18 (RFE/RL) -- The visit to Moscow this week by the First Deputy Managing Director of the International Monetary Fund (IMF), Stanley Fischer, was designed to get a reading of the intentions of the new Russian government after the election rather than to assess the country's adherence to the current three- year program of economic reforms.

Sources at IMF headquarters in Washington say Fischer went in the place of Managing Director Michel Camdessus who is currently visiting several Asian nations. They say the top officials of the Fund always like to meet personally with new leaders after an important election to make sure the government is willing to continue working closely with the IMF.

Fischer met with Russian Prime Minister Viktor Chernomyrdin Wednesday. He also met with Finance Minister Vladimir Panskov and the head of the Central Bank, Sergey Dubinin during his two-day stay.

Fischer's visit to the Russian capital was independent of a team of IMF experts and officials who arrived at the week-end for a monthly assessment of Moscow's compliance with economic and reform targets agreed to for the three-year credit of around 10,000 million dollars approved earlier this year.

IMF sources say Fischer's visit was to be unpublicized but that he decided to make at least two public appearances to comment on the current Russian economic situation after media criticism of the IMF.

IMF officials were furious over a recent article in the British magazine the Economist which suggested that the IMF was purposefully overlooking what the article said was Russia's failure to comply with conditions so as to assure Russian President Boris Yeltin's re-election.

The officials said they want to make clear that the IMF holds Russia to the conditions first agreed to, and takes a number of different steps to check on compliance.

Fischer told reporters on Tuesday that the election itself was "little short of miraculous," because through a very hot campaign, inflation continued to decline and the exchange rate for the ruble remained steady.

Fischer said that contrary to the assertions of some "observers," Russia had "come very close" to meeting the overall targets agreed with the IMF, had not exceeded ceilings on the adjusted budget deficit and had only slightly overstepped monetary targets.

"The notion that Russia is being treated leniently is not right, fundamentally," he said. "Despite the popular perception, they have come very close to meeting targets."

Fischer said that "financial stabilization is basically in reach."

Wednesday, Fischer again met with reporters after his meeting with Chernomyrdin and said that inflation and budget targets had been fulfilled "at a very good level."

Fischer acknowledged that Russia has a real problem with lagging state revenues, a situation that he has said previously must be addressed quickly and substantially to avoid serious financial difficulties later in the year.

The IMF regular assessment team remains in Moscow looking into the current situation while Fischer returns to Washington to share his impressions of the intentions of the Russian leaders with other top IMF officials. IMF sources say his visit is part of a process that keeps the global financial institution closely in touch with its member nations and often helps prevent problems before they arise.

Russia will be due for its next monthly drawing of around 300 million dollars from the IMF credit line at the end of the month, but will get it only after the assessment team satisfies the IMF's Board of Executive Governors that Russia remains on the right economic track.