The Russian government has warned the Duma that failure to pass the new laws could lead to forced devaluation and financial collapse. It would almost certainly undermine Russia’s chances of receiving the additional support loan of US$15 billion, over which the government is currently negotiating with the IMF and other international institutions. But IMF managing director Michel Camdessus warned yesterday that the IMF is itself increasingly strapped for cash. The IMF is believed to have US$40 billion in usable reserves, of which half can be raised quite quickly. Russia’s Finance Minister Mikhail Zadornov responded to Camdessus’ warning last night by saying that the IMF’s cash-flow problems would not put potential lending to Russia in doubt. The US$15 billion that Russia is seeking would not all come from the IMF: Other lending institutions such as the World Bank would also be involved. There is also some suspicion the Camdessus’ warning was pitched mainly at the U.S. Congress, which is currently holding up payment of the U.S. contribution to IMF’s funds. (NTV, BBC, July 1)
MASKHADOV DENIES THAT CHECHNYA WILL SEND TROOPS TO KOSOVO.