Russia says may report Mongolia to Paris Club

Reuters - Wednesday, October 7
ISTANBUL, Oct 6 - Russia may report Mongolia to the Paris Club at its next meeting if there's no progress on the repayment of an outstanding loan worth around $180 million, Russian Deputy Finance Minister Dmitry Pankin said on Tuesday.

"Talks are going on," Pankin told reporters on the sidelines of an IMF meeting in Istanbul.

"We have not yet raised this issue at the Paris Club meetings, but have informed the Mongolian side that if we have not solved the debt problems by the next Paris Club meeting, we will be forced to inform the club that we have unresolved questions with them and that Mongolia has unresolved debts."

The resolution of the debts is a key stumbling block to any further Russian investment in Mongolia, which has been hard-hit by the fall in metals prices during the global economic crisis.

Pankin, who was due to meet Mongolian representatives in Istanbul on Tuesday, said Mongolia had received the credit from Russia for a joint venture in the metals sector.

"Their position is that in 2003, Russia wrote off Mongolia's Soviet era debt and this should also be written off," he said.

"Our position, as we have repeatedly said, is that in order to further develop our cooperation in the financial sector, we need to resolve the existing financial problems."