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By Darya Korsunskaya
MOSCOW, March 20 Russia will not bail out
companies who may face financial difficulties, Finance Minister
Anton Siluanov said, as business owners worry about the impact
of western sanctions over the government's moves to annex
German Chancellor Angela Merkel said on Thursday that
European Union leaders would signal at a summit later in the day
their readiness to ramp up punitive measures against Russia,
including politically sensitive economic sanctions.
The west is responding to Moscow's decision to make the
Ukranian region of Crimea part of Russia.
"We will watch how the situation develops, in what direction
both our economy and the situation in the financial sector go,"
Siluanov told a local business conference on Thursday.
The European Union is the top trading partner for Russia,
accounting for half of total exports and imports, according to
the latest data from the economy ministry.
Siluanov said the government would, if necessary, support
the country's most important companies and institutions as it
did following the 2008/9 global financial crisis.
But it did not have the resources to give financial support
to the vast majority of companies.
"We do not want all the time to be helping company owners,"
Russian government and central bank used billions of dollars
from its gold and foreign exchange reserves to help the
country's largest companies, such as carmaker Avtovaz
and aluminium producer Rusal, through the financial
Siluanov estimated the aid at 8 percent of gross domestic
The reserves, although still the world's fifth-largest at
$494 billion, are more than $100 billion smaller than at the
beginning of the 2008 crisis.
Siluanov said the government is ready to help businesses in
terms of retraining workers, stimulating job creation, but not
more than that. Companies have had the opportunity since the
crisis to get themselves in better shape, he said.
"There has been time to look into problems, get rid of
excess property, reduce costs, improve capitalisation, profits,"
"Those who have not done it, well, sorry, friends. We will
aim primarily to ensure social stability to help businesses and
(Reporting by Darya Korsunskaya; Writing by Lidia Kelly;
Editing by Erica Billingham)