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The Government of the Republic of Serbia

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Serbia, Russia to sign contract regulating Russia’s clearing debt on April 27

Belgrade, 25 April 2007

Serbian Minister of Energy and Mining Radomir Naumov announced today that representatives of the Serbian and Russian governments will meet on April 27 in Belgrade to sign an agreement regulating the $288.6 million clearing debt of the former Soviet Union towards Serbia.

Author: Fonet

At a press conference held at the Ministry’s premises, Naumov said two documents will be signed – an agreement on the settlement of the former Soviet Union’s clearing debt towards former Socialist Federal Republic of Yugoslavia (SFRJ) and a protocol on the delivery of goods and services between the Serbian Ministry of Energy and Mining and Russian Ministry of Finance and Commerce.

Naumov stressed that the agreement on the clearing debt envisages that Russia finances the reconstruction of the Djerdap 1 hydroelectric power plant with $105.5 million and writes-off a portion of Serbia’s $188.2 million debt to Russia’s Gazprom, from the period 1994–2000.

Part of the funds will be used to procure a new accelerator for the Vinca Nuclear Institute.

Naumov recalled that similar debts towards the IMF, the Czech Republic and Poland have already been settled, as well as the debts of the Serbian Oil Industry towards China.

General Director of the Serbian Electric Power Company (EPS) Vladimir Djordjevic said that the renovation of six aggregates in Djerdap 1 will be carried out by Russia’s Silovie Mashine, with whom a contract was signed in 2003.

He said the company has already produced a quarter of the equipment and the delivery will begin a few months following the signing.

According to Djordjevic, the renovation will begin in the spring of 2008 and will last six years since a year will be needed for each aggregate.

He also recalled that the power plant is 35 years old and the renovation is necessary if it is to last another 35 or 40 years.

A $20 million worth of the renovation works will be performed by domestic companies Lola, MIN and Termoelektro.

General Director of the Serbian gas company Srbijagas Milos Milankovic emphasised the significance of settling Serbia’s debt for the delivered gas, adding that this will enable better business terms and improved cooperation with Russia’s Gazprom.

In November 2004, representatives of Russia and the then state union of Serbia-Montenegro signed an agreement on the clearing debt of $306.8 million, of which $288.6 million is towards Serbia proper.