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Russia to extend aid to troubled sectors

Russia to extend aid to troubled sectors

An aide to Russia's president on Tuesday pledged financial help for the crisis-stricken construction, retail and agriculture sectors of the economy.
Russian banks will make more loans to grocery chains and pharmacies, said Arkady Dvorkovich, a top aide to President Dmitry Mdevedev, according to Russian news agencies.
Highly debt-dependent Russian supermarkets are feeling the strain of the credit crunch that has come amid the decline of the Russian economy and the world's economic troubles. Shoppers have encountered shelves empty of even the most basic items at two Moscow retail chains; suppliers are refusing to deliver goods because of the supermarkets' outstanding debts.
The government also is ready to help avert a construction crisis. Dvorkovich said Russia would offer developers to buy some of the housing which has not been completed "so that banks feel safer when lending money for construction."
Construction has been hard hit, with many projects put on hold or canceled. Analysts estimate that at least 15 percent of housing under construction risks being frozen because of a limited access to financing.
Russia also will extend financial aid to agriculture, one of the country's most booming sectors. "We will boost subsidizing interest rate payments for agriculture and animal farming," Dvorkovich said. The national development bank VEB also will be instructed to make additional loans.
Although officials report the harvest is the biggest in decades, agriculture feels the impact of limited credit. Major agriculture corporation Razgulyaya said Tuesday it is freezing investment projects worth more than $US188 million, the Vedomosti daily reported.
Russia's five-day war with Georgia and concerns about Kremlin interference in business hammered Russia's stock markets and economy. Some US$33 billion left the country in August and September, according to official estimates. Some industries have slashed production and many companies have laid off staff.


Updated : 2021-10-26 04:36 GMT+08:00