DUSHANBE, November 24, 2009, Asia-Plus — The remission of debts for cotton producing farms will not affect the country’s national budget, Asia-Plus has learned at the National Bank of Tajikistan (NBT).
Cotton farmers’ debts will be written off due to a special fund of possible losses on loans to cotton producing farms, the source said.
We will recall that the Government of Tajikistan has begun issuing certificates of debt remission to cotton-growing farms. Under this document, all their debts that arose before January 1, 2008 are written off. All farming units having arrears that arose before January 1, 2008 will receive such certificates before the end of this year.
In all, 548 million U.S. dollars will be written off. The government will write off 435 million U.S. dollars given to cotton farmers through the investment company Credit Invest under guarantees from the NBT and a 113 million U.S. dollars debt to commercial banks and direct investors not connected with Credit Invest. According to Tajik authorities, these debts to commercial banks and investors will be cleared through providing long-term state securities to them.
On the repayment of 435 million U.S. dollars given to cotton farmers through Credit Invest under guarantees from the NBT, the source noted that Credit Invest was currently operating and all procedures connected with drawing up package of documents necessary for debt liability accounting would be implemented with support from this company.
“The remission of debts for cotton producing farms will not affect the budget for short-term period (three-four-year period),” said the source, “For the long-term outlook, state securities will be issued; payments on them will be made step by step.”
