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Russia to loan $300 million for Mongolian agriculture PDF Print E-mail
News - General News
Wednesday, 18 March 2009 09:56
russia flagRussia is to provide a $300 million loan to Mongolia, it was announced on Tuesday. The announcement came following an official visit to Russia by Mongolian Prime Minister S.Bayar.

The money is meant to be used to support Mongolian agriculture through funding the purchases of Russian machinery and fertilizers.

The money will be distributed by the state-owned Rosselkhozbank, also known as the Russian Agriculture Bank, and will be distributed as a discounted loan to a consortium of Mongolian banks, Russian Prime Minister Vladimir Putin said.

'The loan will go towards the development of agriculture in Mongolia, ... on providing the sowing of this year, on the development of animal farming,' Putin said.

Prime Minister S.Bayar said he hoped to receive half the money this year.
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roydongen
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reply written by Roy Dongen , March 20, 2009

Undoubtedly Prime Minister Bayar and the other members of the delegations have tried to reach the best results during their visit to Russia.
But like usual the Russian help is hardly any help, just opportunity grabbing, but wrapped nicely in "help & support" printed gift paper, misleading the receiver.
Let's read what is the case:
300 Million will be given as a discounted loan (how much interests is left, what about currency risks?) and...to be spend on solely Russian products, which as everybody knows are usually not of the best quality in this world.
The conclusion is that Russia is giving an export credit to Russian companies for export to Mongolia BUT placing the risks on this credits on the Mongolian government.
Its brilliant but if this is a good second neighbor can be questioned unlike the third neighbor countries like the US (285 million in grants in the millennium challenge project) import tax free export of hundreds of products to the EU, etcetera.
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