Monday, May 21, 2007

Russia not to allow state companies to default: Gref

KAZAN, Russia (Reuters) - Russia will not allow indebted state companies to default, Economy Minister German Gref told reporters on Saturday.

"We have all the possibilities not to allow defaults of state controlled companies," Gref told reporters.

Russian state controlled companies such as Gazprom (GAZP.MM) and Rosneft (ROSN.MM) have been borrowing heavily abroad to go on a spending spree to expand their businesses.

"In order to pay back this debt we will have to sell parts of these companies which will eventually lead to bureaucrats having less influence in the economy," he said.

Gref said Russia "had every chance" of meeting its 8 percent inflation target for 2007.

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