Caution Tempers Expectations on Aid to Russia Funding May Help Restore Economy, but Some Resist IMF's Conditions, Say Analysts. GLOBAL FINANCE

By Amy Kaslow, writer of The Christian Science Monitor | The Christian Science Monitor, April 29, 1992 | Go to article overview
Save to active project

Caution Tempers Expectations on Aid to Russia Funding May Help Restore Economy, but Some Resist IMF's Conditions, Say Analysts. GLOBAL FINANCE


Amy Kaslow, writer of The Christian Science Monitor, The Christian Science Monitor


RUSSIA and 12 other ex-Soviet republics earned some capitalist credentials here April 27, as their applications were approved to the world's premier market-oriented institutions - the International Monetary Fund (IMF) and the World Bank.

United States Treasury Secretary Nicholas Brady called the new memberships, which provide the former republics access to billions of dollars in aid, "a far-reaching turning point in the history" of global financial organizations.

But Mr. Brady, other international finance officials, and private analysts offer a guarded view of just how quickly a pledged $24 billion in IMF, World Bank, and bilateral assistance will be parceled out to help transform the shattered communist systems into market economies.

Some analysts caution that while an influx of capital will spur reform, the conditions attached to the aid give those who oppose change a clear target.

"One of the sentiments on the rise is the IMF as Satan," says one US Soviet-policy analyst who is active in a number of technical-assistance projects in Russia and who also maintains close contacts with the Bush administration. "Politicians believe that the IMF is forcing Russia into more unemployment and a lower and lower standard of living."

Russian Deputy Prime Minister and economic reform architect Yegor Gaidar, whose tough policies were endorsed on April 27 by the world's leading industrialized countries, has promised to move ahead with his efforts.

The IMF could approve a $4 billion standby loan for Russia as early as July, when Mr. Gaidar says he wants to start the process of pegging the ruble to a leading currency, possibly the dollar. But there are signs, duly noted by IMF managing director Michel Camdessus, that the reforms are softening. One example is the Russian government's recent plan to meet the demands of the Congress of People's Deputies for higher civil-service salaries. More government spending only balloons the deficit and devalues the ruble further.

World Bank Senior Vice President Wilfried Thalwitz says he is confident about Russia's moves to a market economy. He estimates that the bank will lend $2.5 billion during the next year to the former Soviet republics for sorely needed imports. Foreign-exchange reserves are perilously low at $60 million, says Gaidar.

"Now we are in a very difficult period in our economic history," Gaidar told reporters here this week. Last week the Russian State Statistic Committee published a report stating that roughly a third of all Russians are impoverished. Moreover, industrial production has fallen 13 percent, joblessness is on the rise, and food shortages are more commonplace.

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
Loading One moment ...
Project items
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited article

Caution Tempers Expectations on Aid to Russia Funding May Help Restore Economy, but Some Resist IMF's Conditions, Say Analysts. GLOBAL FINANCE
Settings

Settings

Typeface
Text size Smaller Larger
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

While we understand printed pages are helpful to our users, this limitation is necessary to help protect our publishers' copyrighted material and prevent its unlawful distribution. We are sorry for any inconvenience.
Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.

Are you sure you want to delete this highlight?