Sergey Nikolayev: The Ulyanovsk region may go bankrupt

Mezhprombank (International Industrial Bank) applied to the arbitration court, asking for it to hand over the control of the budget of the Ulyanovsk region to the Ministry for Finance. If this requirement is upheld, then it will be the first time when the external control is introduced on the territory of a unit of the Russian Federation.

PRAVDA.Ru reported earlier that the office of the presidential envoy in the Volga federal district prepared a draft decree pertaining to the introduction of the external control. However, the document was about the relations between the regions and powee companies. The Ulyanovsk region may become “the pioneer” in this respect, but for absolutely different reason.

The story of the conflict is as follows. In March of 1996, the administration of the Ulyanovsk region with Yury Goryachev at the head raised a loan from the finance ministry “for good purposes” - for deliveries of combustive-lubricating materials and fodder. The sum of the loan totalled 234.988 million rubles. In the beginning of the next year, the finance ministry developed a scheme to make up for the debt, on which the units of the Federation were offered to put the arrears in the form of securities. As spokesmen for the regional administration said, a region could be deprived of funds allocated for the governmental programs if a region decided to reject the scheme.

The region managed to clear only a part of the debt, and the remaining 217.53 million of the debt was turned into the bonds of the regional administration. They say that the securities from Ulyanovsk were bought within rather a short period of time.

Mezhprombank – the International Industrial Bank - became the owner of those bonds. The bank had the whole region as its debtor. For the time being, the Ulyanovsk region is not capable of paying back the remaining part of the debt, and the bank is trying to settle this question at the arbitration court.

The new administration with Vladimir Shamanov at its head has to pay the debts of the old regional administration. The citizens of the region have already got used to the idea that all the largest enterprises of the region are no longer within the borders of the Ulyanovsk region. There is an opinion that the region has lost its economic independence. Now, it is time for the regional budget. If the administration fails to come to terms with Mezhprombank or regulate this issue at the arbitration court, then the region may turn to a certain “training ground” to exercise the external control there. If some other regions will have to face this “horrid experience” in the future, then Russia may probably turn into a unitary state, in which the budgets of the regions will be supervised and manipulated from the center. -dos-

Sergey Nikolayev PRAVDA.Ru Ulyanovsk

Read the original in Russian: http://www.pravda.ru/main/2001/11/27/34276.html