THE GOVERNMENT SCRAMBLES FOR ADDITIONAL FUNDING SOURCES, JUST IN CASE.

Gaidar, who heads Russia’s Democratic Choice party, said Russia’s left had not “the slightest idea” how to pull the economy out of crisis. He would, he added, be “extremely surprised” if the Primakov government received further IMF funding (Russian agencies, October 22). Yet Deputy Finance Minister Oleg Vyugin said yesterday that he believes Russia will eventually receive all of the IMF’s promised US$22.6 billion dollars (Russian agencies, October 22). However, it turns out that the government’s hopes for keeping the tax base from disappearing completely look futile, given that the economy continues to shrink. The IMF’s own chief economist, Michael Mussa, said yesterday the latest data coming out of Russia suggests that its economic decline will be greater than recently predicted. While Mussa refused to give a projection, the fund’s “World Economic Outlook”–which was published last month–forecast that Russia’s gross domestic product would drop 6 percent this year and next (Reuters, October 22). For his part, First Deputy Prime Minister Yuri Maslyukov, also speaking yesterday, said that Russia’s industrial output will have dropped 20 percent by the end of the year. With such bleak economic prospects, the government may try to squeeze out some further revenues by selling off stakes in state enterprises.

Russian agencies, citing sources “close to the Russian government,” reported Thursday that the government is considering the sale of a 5 percent stake in the Gazprom natural gas monopoly, which is partially state owned. A planned auction for a 5 percent Gazprom stake was postponed last August after the collapse of the ruble and the government T-bill market. Government experts also say the government may announce a new auction for a 25 percent-minus-two-shares stake in Svyazinvest, Russia’s giant telecommunications holding company. Only last week, the government canceled the planned auction of the Svyazinvest stake. Prime Minister Yevgeny Primakov, in a tacit criticism of the government of his predecessor, Sergei Kirienko, argued that the starting price for the stake was a “give-away.” Sources told Interfax that the Svyazinvest sale will probably not take place in time to replenish the 1998 budget (Russian agencies, October 22).

GOVERNMENT LOOKS TO ALCOHOL MARKET AND OIL BARONS FOR ADDITIONAL FUNDS.