Russia Resents Lag in Western Aid Moscow Insists That Meeting West's Strict Conditions Could Spark a Social Explosion. GROUP-OF-SEVEN SUMMIT

By Justin Burke, | The Christian Science Monitor, July 6, 1992 | Go to article overview
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Russia Resents Lag in Western Aid Moscow Insists That Meeting West's Strict Conditions Could Spark a Social Explosion. GROUP-OF-SEVEN SUMMIT


Justin Burke,, The Christian Science Monitor


RUSSIAN President Boris Yeltsin, preparing for a crucial meeting with the leaders of the industrialized world, is stressing that Russia will not put its foreign aid needs ahead of domestic political and economic considerations.

The topic of aid to the former Soviet Union is expected to dominate the agenda of the G-7 summit, which begins today in Munich. Mr. Yeltsin is scheduled to attend the gathering Wednesday to argue his case for Western aid to Russia. The West has promised Russia a $24 billion aid package, but so far the money has not been forthcoming.

Though Western assistance could play an important role in helping Russia rebuild its crumbling economy, the country can survive without the foreign aid injection, Yeltsin said at a news conference over the weekend.

"We won't get down on our knees for {aid}," Yeltsin said. "Russia is a great power and will not allow itself to do that." Rising frustration

The president's comments hinted at a growing sense of frustration among Russian leaders with the West and its financial institutions, particularly the International Monetary Fund.

The IMF insists on fulfillment of strict conditions before Russia can become eligible to receive loans. The Russian government revised its economic reform program last week in an attempt to meet IMF standards. (Reform plan, left.) Nevertheless, IMF officials are saying more must be done. The IMF's two biggest remaining concerns are Russia's ability to control its money supply and Moscow's reluctance to lift price controls on energy resources.

"The outlines are correct, but we need more explanation," said one Western financial official in Moscow of Russia's latest reform plans. "Western leaders don't want to see billions thrown into the Russian economy without a firm plan being in place."

Yeltsin, who met with IMF Managing Director Michel Camdessus on Saturday, says domestic conditions rule out the liberalization of energy prices anytime soon. Such action, the president said, could touch off hyperinflation and possibly culminate in a social explosion.

Russia should not be held up to the same IMF standards as those for other nations, Yeltsin argued. "Russia is unique and the reforms here are unique," the Tass news agency quoted him as saying. Mr. Camdessus said after the meeting that the IMF would work out a "special approach" on aid to the former Soviet Union, according to Tass.

Russia already seems to have stretched itself to the breaking point. In addition to revising its overall reform blueprint, the Russian government made some risky moves last week to demonstrate to the IMF its commitment to a market system.

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