Share this article

print logo

LEADING ECONOMIC POWERS URGE RUSSIA TO KEEP FAITH WITH REFORMS IF IT WANTS HELP

The world's leading economic powers urged Russia on Sunday to keep faith with market reforms if it wants more Western help to stave off the threat of financial meltdown.

British Prime Minister Tony Blair discussed the Russian crisis by telephone with President Clinton, who is due in Moscow for a summit meeting Tuesday.

"There was clear agreement (between Clinton and Blair) that we're ready to help Russia, but only if Russia is ready to pursue further economic reform," Blair's spokesman said.

German Finance Minister Theo Waigel said confidence in the Russian economy could only be restored after Moscow carries out promised reforms.

"I can only appeal to the Russian government to go along the path of reform, difficult as this might be," Waigel told Germany's ZDF television.

The collapse of the ruble and declaration of a moratorium on some Russian debt have rattled global markets and sent Russians scrambling to banks to withdraw their money.

The International Monetary Fund and the United States made clear Friday that further payments from a previously agreed $23 billion rescue package for Moscow were on hold until it was clear what direction reforms would take.

Western economic powers are concerned that Moscow will backtrack on free-market reforms and restore features of the old Soviet command economy, including printing vast amounts of money to pay workers back wages and bail out insolvent banks and companies.

Blair earlier telephoned other leaders of top industrialized nations. Austria, which holds the European Union presidency, said the European Union would work closely with the Group of Seven leading economies to encourage Russia to press ahead with reform.

Officials have said there are no current plans for a special meeting of the G7, which brings together the United States, Britain, Germany, France, Italy, Canada and Japan. But Russia's crisis is likely to dominate Clinton's summit with President Boris N. Yeltsin.

Western economic powers are worried Russia's problems have seriously undermined investor confidence, increasing the risk of a global downturn.

Stock markets around the world plunged last week in reaction to the crisis that intensified after Yeltsin sacked his entire government, which had been packed with reformers, and named Chernomyrdin acting prime minister.

Yeltsin had come under sharp criticism after the Russian government in mid-August effectively devalued the ruble, just three days after he pledged not to.

There are no comments - be the first to comment