ANNOUNCEMENT 03 Jan 2014In January 2014, the government of the Russian Federation announced a change to private-sector financial support.
NUMBER OF INTERVENTIONS
On 3 January 2014, the Russian Government dopted Decree 5 thus granting federal budget subsidies to Russian chemical companies for partial reimbursement of the interest payments on loans in 2014 to 2016. Only loans issued by Russian credit organisations and the state-owned Vnesheconombank are eligible for the scheme.
In total 418.7 million Roubles (USD 12 million) in state subsidies will be allocated. Their annual distribution is planned to be as follows: 70.2 million Roubles (USD 2 million) in 2014; 168.5 million Roubles (USD 4.8 million) in 2015 and 180 million Roubles (USD 5.1 million) in 2016.
The subsidies for Russian Rouble-denominated loans will cover two thirds of the beneficiary's interest payments for the respective accounting period, but no more than two thirds of the Central Bank's refinancing rate on the day of respective interest payments. Subsidies for foreign-currency denominated loans will be allocated in Roubles and will cover two thirds of a company's interest payments for the accounting period, based on the exchange rate for the rouble established by the Central Bank of Russia on the day of the respective interest payment, but not more than 4% p.a. on foreign currency loans.
This state measure has the aim to reduce the import dependence in the high-tech chemical industry, which has a high added value for the local market, and to facilitate the creation of new highly productive jobs.