Debt to be reduced to zero

Ulaanbaatar, Mongolia, /MONTSAME/ The cabinet meeting held Wednesday approved a Mongolia-Russia inter-governmental agreement on regulation of financial responsibility of Mongolia to the Russian Federation (RF) which was signed December 14, 2010 in Moscow, Russia.

The Minister of Foreign Affairs G.Zandanshatar has been obliged to give a report to the Russian side about Mongolia's ensuring rules of validating the agreement.

In accordance with the agreement, the cabinet has suggested L.Purevdorj, a president of the Bank of Mongolia, to establish an agreement on technical rule and keeping settlement account between the Bank of Mongolia and the "Development and foreign economic activity bank" Russia's state corporation.

In order to collect a half of authorized capital of the "Mongolrostsvetmet" Mongolia-Russia joint venture for Mongolian side, the former Soviet Union gave a loan to Mongolia. As of the year 2010, a balance of the debt of Mongolia to Russia was 163.7 million convertible rubles according to Russia-made account. In addition to it, a balance account, which had been opened for the barter between Mongolia and Russia, reached 10.4 million clearing U.S dollars but the sides had not been tackling the debt.

As results of several meetings and talks on tackling the debt issue, the financial ministers of the two countries signed an inter-governmental agreement on annulling balances of the debts during the official visit of Mongolia's Premier to Russia December 13-16, 2010. Accordingly, Russian side annulled 97.8 per cent of the debt which stood at USD 174.2. Thus, Mongolia will pay USD 3.8 million within 30 days from the first day of the agreement. The money has been placed in the state budget for 2011.

B.Khuder

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