Soskovets Pushes Return To Soviet-Era Farm Loans

First Deputy Prime Minister Oleg Soskovets on Monday urged the government to revert to an old system of issuing soft loans to agriculture. Soskovets, a moderate conservative with strong links to industrial directors, gave the Central Bank and finance and economics ministries one week to decide on the issue. "Regional leaders expressed their dissatisfaction with the credit policy conducted by the government when they recently met President Boris Yeltsin," he told a government meeting. Soskovets, a Soviet-era heavy industry boss, has in the past demanded a partial confiscation of Russian banking profits to force banks to invest in industries. His call for preferential credits for farmers is likely to be opposed by Prime Minister Viktor Chernomyrdin, whose policies this year have resulted in a more or less tight monetary policy and lower inflation, at 8.1 percent in May after January's rate of 22. The Central Bank has phased out soft loans to agriculture since a deflationary agreement with the International Monetary Fund in May 1993. Since then, many private farmers have been forced to borrow at commercial bank rates, now around 200 percent a year.