MOSCOW AND TEHRAN TO SETTLE DEBTS.

Russia and Iran will sign a protocol on the settlement of mutual financial obligations during Deputy Prime Minister Oleg Davydov’s official visit to Iran of December 26-29. Davydov is also Russian minister for foreign economic relations. As of late July 1995, Tehran owed Moscow $582 million, including $380 million to the state-run defense company Rosvooruzheniye and $170 million to the foreign trade company Tekhnoexport. Iran has justified its failure to repay the debts by its tight financial situation and Russia’s unsettled debt to Iran of about $195 million. Both countries have now agreed to settle their financial obligations. According to the Russian Ministry for Foreign Economic Relations, Iran will repay its debt in cash and oil within the next four and a half years. (13)

Iran accounts for approximately 85 percent of Russia’s overall machinery and equipment exports for energy (chiefly nuclear) facilities. In 1994, Russia exported 104 million dollars’ worth of military equipment to Iran, as well as 333 million dollars’ worth of equipment and services, mostly in the area of energy facilities. Provided the financial situation remains favorable, Russian government experts expect exports to Iran to rise to $4 -$4.5 billion in the next ten years.

Russia Seeks Debt-For-Equity Swap.