RUSSIA TO ISSUE DEBUT EUROBONDS WORTH $500 MILLION.

Russia’s first eurobond issue will be launched between November 21 and 25 and will be worth about $500 million, according to Russia’s finance minister. (Interfax, November 9) Aleksandr Livshits said the government plans to make a small and cautious initial issue and to follow it up with a second issue in 1997. Officials from the Russian Finance Ministry, J.P. Morgan and SBC Warburg, who are handling the issue, will hold a series of presentations to investors between November 11 and 20 in Luxembourg, Geneva, Zurich, Paris, London, Frankfurt, Singapore, Seoul, Tokyo and Hong Kong. It is hoped in Moscow that by increasing the share of foreign financing of Russia’s budget deficit and reducing sales of Treasury bills in the domestic market, the cost of domestic debt servicing, which is being pushed up by the high yields of state securities, will fall.

Livshits also said that federal tax collection rates improved in the second half of October, after reaching an all-time low in September, and that the chances are good that the IMF will agree to issue the November tranche of its budget support loan to Russia. Last month, the IMF withheld payment, telling the government that it must first improve its tax collection rates. (Itar-Tass, November 10)

According to Deputy Prime Minister Oleg Davydov, agreements with the London and Paris clubs paved the way for the entry of Russia into the world financial markets. (Interfax, November 8) Another step in this direction took place last month, when Russia received its credit ratings from leading European and American rating agencies. Credit ratings reflect perceived risk of default by a borrower and influence its funding costs. The ratings given put Russia in the same league as Romania and Lithuania, but fell short of the investment grades granted to Slovenia, the Czech Republic, Poland, Slovakia and Hungary. (Financial Times, November 6)

Moscow Again Demands Release of Former Spy.