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The Moscow Times Moscow Guide – Winter 2008

Since the middle of autumn one of the most important topics of discussion, could only be … no, not the financial crisis… New Year! The winter issue of The Moscow Times Moscow Guide is entirely devoted to New Years celebrations. Seven great ideas for celebrating the “Night of Nights” will help readers finalise their plans and choose how and where to party, give fresh ideas and lots of practical advice.

And don’t forget – problems will come by themselves, but happiness and luck need an invitation. That why the more cheerful and light-hearted your celebration of the coming holiday is, the happier and more successful 2009 will be for you.

The Crisis: Signs of a Kremlin Fearful Of Unrest
Sociologist Yevgeny Gontmakher has painted a disturbing picture of what might emerge from the financial crisis, forecasting continued unemployment, huge protests and spreading violence.

Market Matters: Huge Grain Harvest No Boon for Farmers
This year Russia is enjoying the biggest grain harvest it has ever seen -- and farmers couldn't be more worried.



Tuesday, January 06, 2009 Updated at 31 December 2008 22:36 Moscow Time.

The Moscow Times » Issue 4001 » Business

Sergei Karpukhin / Reuters

Ulyukayev attending a business conference Wednesday on capital markets.

New Steps Proposed for Liquidity

02 October 2008By Tai Adelaja / Staff WriterThe Central Bank on Wednesday announced a series of measures aimed at shoring up liquidity and helping to cope with the effects of the ongoing financial crisis.

Central Bank First Deputy Chairman Alexei Ulyukayev said the turmoil in the country's financial markets had been localized but that liquidity problems created in its wake could last for another 15 months.

Speaking at a conference on capital markets, Ulyukayev said the $50 billion that the Central Bank is to make available to the state-owned Vneshekonmbank, also known as the Development Bank, to help refinance the debt of Russian banks and companies would be released by the end of next year.

He said Russian banks and companies would need to pay back up to $40 billion to foreign creditors before the end of 2008 and another $80 billion in 2009.

The Central Bank may also ease requirements on loan collateral by one percentage point to stimulate domestic banks, Ulyukayev said.

A draft bill is also being prepared that would allow the Central Bank to offer unsecured loans to rated banks for up to six months to supplement the regular banking auction organized by the Finance Ministry, he said.

As an additional measure to shore up liquidity and push down interbank credit rates, Ulyukayev said Sberbank, VTB and Gazprombank would maintain credit on the market at a minimum of 60 billion rubles ($2.3 billion).

A draft law is being prepared for the Central Bank to share credit risks with the three state-controlled banks should their counterparties default on their obligations.

Ulyukayev said the three banks would also receive partial compensation for losses incurred on the interbank market.

He said, however, that measures directed at propping up the financial market might raise inflation by one or two percentage points.

The Central Bank would also need to adjust its net 2008 capital inflow forecast, earlier set at $40 billion, because of the ongoing global financial crisis.

Ulyukayev said the Central Bank would not adjust its two-currency basket limits soon.

"The Central Bank must be neutral with regard to the exchange rate, and pricing should depend on the balance on the forex market."