Europe

Belarus 'to get Russian bail-out' worth $3bn

Russian Prime minister Vladimir Putin (left) in Minsk with his Belarusian counterpart, Mikhail Myasnikovich, 19 May
Image caption Vladimir Putin (left) met his Belarusian counterpart, Mikhail Myasnikovich

A Russian-backed $3bn (£1.8bn; 2.1bn euros) loan has been agreed for Belarus, the struggling ex-Soviet republic's prime minister has said.

However, Russia's finance minister warned that the loan was tied to privatisation and would be ready no sooner than early June.

Analysts predict conditions for any bail-out will be stringent.

Russian Prime Minister, Vladimir Putin, has been visiting Belarus for talks with President Alexander Lukashenko.

A currency crisis is currently gripping Belarus, eroding rouble savings and causing a shortage of imported goods such as medicines.

Russia is one of the country's few allies while its authoritarian political system under Mr Lukashenko has estranged it from the West.

Three-year term

Prime Minister Mikhail Myasnikovich said conditions had been agreed to provide a crisis loan of $3bn-$3.5bn over three years at a below-market interest rate.

It would be released, he said, through the Eurasian Economic Community, a six-nation group led by Russia.

Speaking after talks in the Belarusian capital Minsk, Russian Finance Minister Alexei Kudrin said: "We have a condition.

"In the next three years a certain privatisation should be carried out."

Moscow is said to have its eye on Belarusian assets, including oil refineries, the gas pipeline system, the main mobile phone provider and the potash production complex.

Russia already subsidises the Belarusian economy in exchange for it smoothly delivering Russian oil to Europe.

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