Russia to grant Cuba $350 million credit
Campaign News | Friday, 29 September 2006
Russian Prime Minister Mikhail Fradkov on offical visit
HAVANA -- Russia agreed on Thursday to grant Cuba credit worth $350 million and restructure some of its recent debt during a visit by Russia's prime minister, officials said. The two countries also signed a military cooperation agreement.
Cuban Defense Minister Raul Castro, who is acting president while his elder brother Fidel recovers from intestinal surgery, gave red-carpet treatment to Mikhail Fradkov, the highest-ranking Russian official to come to Cuba since a visit by President Vladimir Putin in 2000.
Wearing a gray suit instead of his customary military uniform, Castro escorted Fradkov through the halls of Havana's Palace of the Revolution, past rows of soldiers playing Cuba's anthem.
The two met privately and did not speak to the press about the encounter.
But Alexander Bochanov, the press liaison at the Russian Embassy in Havana, said that Russia had agreed to restructure some $166 million of debt acquired in recent years.
The $350 million line of credit will be used to buy Russian goods and services. It is a 10-year loan with annual 4-percent interest, according to Russia's RIA Novosti news agency, which reported that Fradkov said the credit would be used to help modernize Cuba's energy sector and transportation system, reconstruct water conservation facilities and railroads, and design and deliver air navigation systems.
Under an ideological and economic alliance that lasted three decades, Cuba once relied on Soviet Union subsidies for about 20 percent of its gross national product. Its economy has since become more self-sufficient, though it now benefits from strong relations with Venezuela, its current leading trading partner.
Bochanov said Raul Castro and Fradkov did not discuss Cuba's Soviet-era debts with Moscow, which Russian media reports have estimated at more than $20 billion. Havana puts the amount at closer to $11 billion.
Fradkov arrived in Havana late Wednesday as the head of a delegation looking to increase business with Cuba in the aviation, transport and energy sectors.
The group will visit Russia's pavilion at the International Transport Fair taking place in Havana through Saturday. Fradkov will also go to the island's Center for Genetic Engineering and Biotechnology, and is scheduled to meet Friday with Parliament Speaker Ricardo Alarcon.
Relations between Russia and Cuba chilled after the Soviet Union's collapse but warmed with Putin's visit in 2000.
The Caribbean island exports sugar to Russia, as well as vaccines and other products from its advanced biotech industry.