Armenia: Crisis-Squeezed Yerevan Seeks Russian Financial Help

Russian Minister of Finance Alexei Kudrin and his Armenian counterpart Tigran Davtian on May 20 signed an agreement on a 15-year, $500-million Russian "stabilization" loan.

The credit will be used primarily to develop infrastructure and to stimulate small and medium-sized businesses in Armenia, the Interfax news agency reported.

"We are providing a five-year grace period before repayment of the principle debt, during which we will only be paid the interest on credit," said Kudrin, echoing the speaking style of a commercial bank's loan officer. The interest rate on the loan is London Interbank Offered Rate (LIBOR) plus 3 percent, the RIA Novosti news agency quoted Kudrin as saying.