Finance Ministry forecasts fall in inflation

Inflation will be falling 1-2 percent annually over the next two or three years in Russia, Russian Senior Deputy Finance Minister Bella Zlatkis announced at the round-table meeting "The credit standing of Russian regions" today. She noted that this forecast would be taken into account in the 2004 and 2005 budget drafts.

The Deputy Finance Minister reported the successful implementation of the 2002 budget and stated that the positive balance of state loans on the open market was 3bn rubles (about $94m). The total volume of loans attracted by the government on the open market in 2002 reached 120bn rubles (about $3.77bn).

According to Zlatkis, the Cabinet's policy on the open market was becoming a benchmark for Russian regions and republics. "Over the next several years, in the event the situation on the debt market is positive, regions will be able to take loans for five to eight years at a 14-15 percent interest rate," the official was quoted as saying.