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Russia mulls $2 bn loan for cash-strapped Belarus

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(Globalpost/GlobalPost)

Russia said Friday it might give Belarus a $2.0 billion loan to help the cash-strapped country avert a debt default and possible currency devaluation.

Economy Minister Anton Siluanov said the issue was being discussed during talks in Saint Petersburg between Russian President Vladimir Putin and his Belarus counterpart Alexander Lukashenko.

"Our leaders are studying this issue," Russian news agencies quoted Siluanov as saying.

He added however that Belarus had not followed through on an earlier promise to privatise $2.5 billion worth of state property last year -- a condition under which Minsk had secured an earlier loan from Moscow.

"If Belarus was able to sell property worth this sum, it would not lead to a loan," Siluanov noted.

Media reports said Lukashenko was asking for finances to spend on modernising five large enterprises that could then be sold to Russian firms.

Belarus will need to pay off $3.1 billion in foreign loans to Russia and the International Monetary Fund this year -- something made difficult by state's need to also pay for crucial imports such as Russian oil.

Russia has turned into one of the isolated nation's last sources of funds following the breakdown of talks with the IMF at the end of 2012.

The IMF said it would no longer consider extending programmes to Belarus because of the authoritarian Lukashenko's refusal to reform.

zak/ma/wai

http://www.globalpost.com/dispatch/news/afp/130315/russia-mulls-2-bn-loan-cash-strapped-belarus