Russia considering loan to Iceland

RussiaThe Russian press is beginning to speculate about the reasons for potential upcoming strengthened relationship between Iceland and Russia.

The Moscow News informed that Russia received the official request for a loan from Iceland late on Tuesday.
“We will consider it. Iceland has a reputation for strict budget discipline and has a high credit rating. We’re looking favourably at the request,” said Alexei Kudrin, the Russian Minister of Finance.

“This is looking like the beginning of relations between Russia and Iceland,” Jon Thorisson, CEO of an Icelandic investment bank, told The Moscow Times daily.

On the other hand, Vladimir Krendel from the Institute for Financial Research in Moscow does not consider it a beginning of relations. “We had a long-standing relationship with Iceland in the times of the Soviet Union, when we provided them with oil. This was very unusual because Iceland was part of NATO, and NATO was the enemy”, he said.

Marina Pustilnik, a reporter from The Moscow News, wrote: “Providing Iceland with a much needed loan would hardly dent Russia’s huge currency reserves. This is purely political, there is nothing economic in it”.
“And although Russia is now looking for friends in strange new places, it is clear that should Moscow approve the loan to Reykjavik, it would not be doing so in the hope of becoming great friends,” she continued.

In fact, Russia has given away much more money in forfeited loans to numerous third-world countries, while Iceland actually stands all chances of being repaid.

The Icelandic delegation is to fly to Russia this weekend and negotiations on the loan are supposed to start on Tuesday, October 14th.

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