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MOSCOW, December 28 (RIA Novosti) – China has agreed to write off Soviet debt totaling 1.57 million Swiss francs ($1.7 million), in a move that will restart a helicopter delivery program, Russian Deputy Prime Minister Dmitry Rogozin said on Friday.
“It is pleasant when partners stick to their words,” Rogozin wrote on Twitter.
Moscow and China had previously agreed to retire $408 million in Soviet debt to China with deliveries of Russian goods, including 20 Kamov helicopters worth about $355 million. However, the project stalled after China failed to write off the $1.7 million in debt following deliveries of goods and services by one of the Russian organizations involved in the project.
Rogozin said Russia is now ready to finance the contracts signed between China’s State-Research Information Technology and Russian Helicopters on the delivery of the helicopters.
Earlier this month, Rogozin said that Russia and China planned to settle the debt issue by the end of 2012.
The total debt of the former USSR to official bilateral creditors is $2.2 billion, according to a July 2012 report by Russia’s Finance Ministry.
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Any response would likely boomerang on Russia – the partnership between Rosneft and ExxonMobil is a case in point. The United States has hit Russia with a third round of sanctions. This time the Americans went with a higher caliber weapon, targeting Russia’s biggest energy companies (Rosneft and Novatek) and banks (VEB and Gazprombank).