Russia, Greece to sign $12 mln Soviet-debt agreement in Oct.

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MOSCOW, September 27 (RIA Novosti) - Russia and Greece will sign an agreement to settle the debt of the former Soviet Union and the Russian Federation to Greece, worth about $12 million, a Russian government source said Wednesday.

The agreement will be signed during Prime Minister Mikhail Fradkov's October 5-7 visit to Greece and follows moves undertaken by the country earlier in the year to clear its debt to the Paris Club of creditor nations in full.

The Soviet-era debt to Greece includes a commercial debt of $10 mln and a social security debt of about $2 mln, which accrued under a Soviet-Greek agreement on pension support for ethnic Greeks who repatriated from the Soviet Union.

The official said the debt would be cleared within 30 days after the agreement is signed.

Russia's Finance Ministry said earlier it expected to swap the second tranche of its Soviet-era commercial debt by November.

The Soviet-era debt to commercial lenders accrued as a result of the export of goods and services by foreign companies. The Finance Ministry estimates the principal sum of this debt at more than $1.7 billion.

At the second stage, Russia will swap debt claims worth about $600 million. Creditors' claims will be swapped on the terms of the London Club of commercial lenders, i.e. for Eurobonds with a maturity in 2010 and 2030 and partially for cash, the ministry said.

The Finance Ministry swapped the first tranche of Russia's Soviet-era debt to commercial creditors for its Eurobonds in December 2002. Claims worth $1.28 billion were recognized for the swap, and as a result, Russia's Eurobond issue totaled $1.37 billion.

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