Moody's Agency Rises Russia's Rating

This change in the forecast also applies to eurobonds and Russian bonds nominated in rubles. In the opinion of experts of the agency, the political situation has improved significantly due to the results of the presidential elections. The main economic indices for 2000-2001 testify to the significant strengthening of the economic situation in Russia. For example, experts noted positive growth rates and the preliminary surplus of the consolidated budget. Owning to the restructuring of various Russian debts, the terms of the redemption of the corresponding bonds have been postponed. This had a positive impact on Russia's gold and currency reserves. Experts from the Moody agency think that the improvement of the economic situation in Russia became possible mostly due to high oil prices on world stock exchanges. As a result, the Russian budget gets additional revenues. Nonetheless, in the experts' view, despite this improvement, Russia still needs serious structural reforms in the spheres of taxation, land use, labor legislation, bankruptcy legislation, social protection system and the restructuring of industries. This increase of the rating implies minuses too. Thus, Japan, the world's largest creditor, announced an intention today to fully write off debts of the poorest countries and also to give additional funds of $200 million to the World Bank for coping with poverty in the third world countries. Having a positive rating, from now on Russia can hardly count on its debts being written off.