MOSCOW Jan 23 Russia will tap into a rainy-day
fund for most of the $15 billion bailout it promised Ukraine
after Kiev scrapped plans for European Union deals that would
have pulled it further from Moscow's orbit, Finance Minister
Anton Siluanov said.
President Vladimir Putin agreed the aid package with Ukraine
in December, throwing the ex-Soviet state a lifeline in what was
widely seen as a reward for a U-turn that prompted protests
which persist in Kiev and have been marked by violence.
Russia will turn to its National Welfare Fund for $10
billion, Siluanov told Ekho Moskvy radio on Thursday.
The other $5 billion is coming from special drawing rights
(SDRs), a reserve asset created by the International Monetary
Fund, he said. Officials had said both sources would probably be
used for the bailout, but had not given a breakdown.
"A decision was taken to support our neighbour's economy,"
Ekho Moskvy quoted him as saying. "It is not in our interest
for the situation to worsen sharply."
Some in Russia have grumbled about using cash that is
supposed to be kept for helping its growing population of
pensioners to aid its neighbour.
Kiev needs cash to cover its external funding gap, while the
central bank's currency reserves are depleted by efforts to
support the hryvnia and repay foreign debt.
The Ukrainian government owes around $8 billion in foreign
debt payments this year. Ukraine owed $2.7 billion for gas at
the end of 2013, according to Russian gas company Gazprom, so
some of the money will come back to Russia.
Siluanov said the rate on the package of credits was 5
percent and that they would come due on Jan. 1, 2016, Ekho
Russia closed a deal in late December to buy Ukraine's
newly-issued $3 billion Eurobond, the first part of the bailout.