Updated at 23:33,12-02-2020

Moscow rejects Minsk’s request to change terms of loan for NPP project

Zachar Ščarbakoŭ, Naviny.by

Moscow rejects Minsk’s request to change terms of loan for NPP project
It is impossible to accept Minsk’s request for changing the terms of the Russian government’s $10-billion line of credit for the construction of the Belarusian Nuclear Power Plant, Russian Deputy Finance Minister Sergei Storchak told reporters on Tuesday.

“Our Belarusian colleagues are urgently asking us to revise the terms of the loan agreement currently in force,” Mr. Storchak said.

Simultaneously extending the repayment period for the loan and cutting the interest rate “does not comply with financial theory,” he noted. “That is why it is necessary to look for compromises in another field.”

“Consultations on the issue are underway.” Mr. Storchak said. “This issue is complicated. It depends on resolving several interconnected issues.”

The issue was reportedly discussed at length during talks between government delegations led by Aliaksandr Lukašenka and Vladimir Putin, which were held in Russia’s Sochi on February 7.

As Belarusian First Deputy Prime Minister Dzmitryj Kruty told reporters following the talks, Belarus will suggest that the start of the repayment period for the loan should be postponed because the end dates for the project have already been postponed.

In addition, Belarus will suggest that the repayment period be extended, and that the interest rate on the loan be “somewhat reduced” and brought into line with the interest rates on loans provided to other countries where Russia’s Nuclear Energy State Corporation (Rosatom) builds nuclear power plants, Mr. Kruty said.

The Belarusian Nuclear Power Plant has been being built since November 2013 in the Astraviec district, Hrodna region, some 10 miles from the Lithuanian border.

The general contract provides for the construction by AtomStroyExport (Rosatom’s subsidiary) of two 1200MW power units, which will have VVER-1200/491 (AES-2006) pressurized water reactors.

Under the loan agreement, signed in November 2011, the Russian government’s $10-billion line of credit was provided for the period until 2020 and is to start to be paid back in 30 equal installments six months after the nuclear power plant is put into operation but no later than April 1, 2021, with the payments to be made every six months.

Half of each borrowed amount is to be repaid at an annual interest rate of 5.23 percent and the other half is to be repaid at a floating rate equal to the six-month U.S. dollar London Interbank Offered Rate (LIBOR), plus a spread of 1.83 percent per annum.

The Belarusian leader earlier suggested that the interest rate should be no higher than those on loans for other countries, such as Armenia, Bangladesh and Hungary, and that it should be lowered to three percent.