13:01 GMT +314 December 2017
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    Russia becomes IMF creditor

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    MOSCOW, June 1. (RIA Novosti) - The $204 million that Russia saved by repaying its debts to the International Monetary Fund early will have to be spent on its new IMF commitments, Gazeta, a popular daily, reported today.

    Russia is now a creditor rather than a major borrower: yesterday Prime Minister Mikhail Fradkov signed a resolution, in compliance with which the country will pay 49 million SDRs (special drawing rights used by the IMF as the units of account) to the Fund. This sum is equivalent to about $73 million. In the past, Russia did not have to make such payments because it was a debtor.

    The Finance Ministry explained that Russia was making this payment for the first time. Under the IMF rules, member states make quarterly contributions, which are used as loans provided by the IMF. On January 31, Russia returned its remaining debt of $3.3 billion to the Fund ahead of schedule. Under the original timetable, Russia was supposed to make payments until 2008. Therefore, the country saved money on interest payments. These funds were intended for domestic spending, but these hopes have not come materialized.

    The $73 million that Russia will pay to credit IMF clients equals the amount saved on interest payments for this year, which means the country will have to use other sources to make next contributions. However, there is no other way: the size of contributions is defined by the quota of the member state. The USA has the largest quota (17.16%), whereas Russia is only the 10th place with 2.8%. Nevertheless, the position of Russia in the Fund outstrips its real weight in the world economy: in terms of GDP, Russia is only 16th. This is understandable: in 1992 Russia was admitted to the IMF on honorary terms as the successor to the USSR. At that time, Russia needed loans and, therefore, the larger the quota, the more financial aid it could get.

    The newspaper writes Moscow will now have to pay for a new creditor status. It is impossible to say yet how Russia's contribution will be used. The IMF will make the final decision and Russia does not have the deciding vote. However, countries that get loans from the Fund include Russia's neighbors, for example, Georgia.

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