Russia's foreign debt as of January 2003 was $122.1 billion, which equaled 35.7% of its GDP. It has reduced by over 30% against the start of 2000, when it was $158.4 billion, or 89.5% of GDP.
"The current indicators of the 'debt stability' of the Russian Federation, drawn up in keeping with international methods, show that the country has eliminated the consequences of the 1998 financial crisis and has reduced substantially the state debt burden," the document says.
In 2003 the problem of the foreign debt, of its repayment and servicing, no longer has a determining influence on the country's economic development and its budget policy, the document says.
"An important result of the budget policy pursued in 2000 to 2003 has been the timely repayment and servicing of the state debt," it is indicated in the materials. In 1999 the total state debt was comparable with the country's GDP, and by the start of 2004 it went down to 35% of GDP.
"Today one can say that the Russian Federation has not only solved the problem of peak debt repayments but has also created necessary reserves and preconditions for reliably meeting budget commitments in the middle term perspective," it is pointed out in the document.
The increase in the internal debt share in the structure of Russia's state debt will help decrease the dependence of the federal budget on outside factors. This share will exceed 20% by the end of 2004 (compared with 15% at the start of 2003) and in the future it will reach 50%.
Nonetheless, the main problem associated with the state debt still is the impossibility of conducting stable refinancing of the state debt at the expense of domestic and foreign borrowings in required amounts and on favorable terms. The possibilities of guaranteed attracting of state loans for refinancing the debt are limited also by the terms of cost in these borrowings. As estimated by the Finance Ministry, the Russian Federation will be capable of annually borrowing not more than $5-6 billion on foreign markets in the coming few years.