A New Model For Russia?
In a move that could have far-reaching implications, President Boris Yeltsin is going ahead with a novel deal in which nine Russian banks will lend the government about $2 billion in exchange for state-owned shares of some 100, yet-unnamed companies. This could mark the beginning of an emerging economic structure similar to Germany's or Japan's in which banks have close ties to big business.
The scheme is aimed at giving the hard-pressed Kremlin budgetary relief. Anatoly B. Chubais, the Deputy Prime Minister in charge of economic policy, says foreign firms are welcome to take part in the loan, but their initial interest appears lukewarm. Special restrictions will supposedly keep the banks from stripping company assets or making big changes in management.