officials and their Russian counterparts finally reached agreement on humanitarian food aid for Russia. The package consists of 1.5 million tons of wheat, which will be given for nothing, and 1.5 million tons of meat, dried milk, animal feed and other food products–which will be given as a long-term credit, to be paid back over twenty years, with no payments required for the first five and at 2 percent annual interest. Another 100,000 tons of various goods will be sent to charity organizations. The total price tag on the deal is US$625 million, and another US$260 million for shipping costs. The deal became unsnagged when Russia graciously agreed not to apply taxes and tariffs to the shipments (as it has done with past aid shipments) and to put profits made from the sale of food shipments toward Russia’s ailing Pension Fund and other social payments. Deputy Prime Minister Gennady Kulik said the United States is prepared to send additional food aid. The credit for food aid will go to several state-controlled companies, including Roskhleboprodukt, which was in charge of receiving food shipments in the early 1990s. Critics charged that much of this aid was diverted to the black market.
Meanwhile, parts of Russia last week were experiencing acute energy shortages. The Kamchatka peninsula in Russia’s Far East was left without heating and electricity. The situation was so bad in Chukotka, just across the Bering Strait from Alaska, that emergency officials were forced to evacuate 1000 of its residents.