RUSSIAN GOVERNMENT WORKING ON DEBT TO DEFENSE SECTOR.

Having caught up on most of its wage payments to the military and civilian personnel in the armed forces, the Russian government is now grappling with the its enormous debt to the country’s defense plants. An unnamed government spokesman yesterday put this debt at 15.1 trillion rubles ($2.58 billion). He indicated that the government had paid 11.8 trillion rubles ($2 billion) in partial payment of its 1996 debt and would repay the rest by the end of the year.

The 1997 defense order is said to be on a sounder footing but the priority to date has been to clear up the older debts. Therefore payments on current orders are just beginning, with 500 billion rubles ($85.6 million) to be allocated in the first half of this month.

These efforts are long overdue. On September 6 a top trade union official warned that there is a serious threat of a social explosion, especially in those cities whose economy depended on arms production. Mikhail Shmakov, chairman of the Federation of Independent Trade Unions of Russia, said that his organization was considering proposals for protests actions in the months ahead. He also put the total government debt to the sector at more than 15 trillion rubles. (Russian agencies, September 7; Itar-Tass, September 8)

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