Russia has paid about $900m to the IMF in 2004. This year, Russia is due to pay about $1.7bn (SDR 1.2bn) to the Fund. As of January 1, 2004, the debt to the IMF was about $5.1bn.

Russia’s total public debt would drop to 18 percent of the GDP by 2007, Sergey Kolotukhin, Director of the Finance Ministry’s Department for International Financial Relations, Public Debt and Government Financial Assets, said on Wednesday.

He said the country’s public debt was expected to be 26.5 percent of the GDP by the end of 2004, which was a “very moderate figure compared with some industrially developed countries”. As the Russian economy is more vulnerable to risks, the public debt should be significantly lower than in industrially developed countries, according to Mr. Kolotukhin.

Sergey Shokhin, Chairman of the Audit Chamber, said Russia’s foreign debt was expected to drop to $115bn by January 1, 2005. Indeed, the country’s foreign debt keeps reducing. In 2000, it was $139bn, and it was $120bn by January 1, 2004. According to Me. Shokhin, about 45 percent of its foreign debt Russia owns to the Paris Club of creditor nations.

Meanwhile, Germany plans to securitize part of Russia’s debt for sale to private investors in the form of 3, 5 and 10-year bonds. According to Reuters, it will be about EUR 2bn. Revenues from the deal will go to the budget.

The 3, 5 and 10-year bonds, denominated in both dollars and euros, will be issued in three tranches. Standard & Poor's assigned a “BB+” rating to the bonds, while Moody's Investors Service assigned primary long term ratings of (P) Ba2 to the three bond issues.