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Georgia Proposes Advanced Repayment of Debt to Azerbaijan

Business Materials 1 October 2007 11:59 (UTC +04:00)

Azerbaijan, Baku / Trend corr. I.Khalilova / The Georgian Finance Ministry has proposed an advanced repayment of the $16,189,573 debt to Azerbaijan. The issue is currently being considered.

In compliance with an intergovernmental agreement on restructuring Georgia's debts to Azerbaijan, Georgia will compound the debt in 2025. The agreement came into force in February 2007. Georgia will pay Azerbaijan $22mln taking into account an old debt and accrual of interest. Georgia ran into debt as a result of housing operations between state enterprises in 1992 and 1994.

The intergovernmental agreement on restructuring Georgia's debts to Azerbaijan was signed in Batumi in August 2006. Repayment will be implemented in three stages. Georgia paid some $2.7mln at the end of 2006. Some $3.239mln will be paid from 2007 to 2021. Georgia will pay the remaining sum from 2010 to 2025. The interest rate of the loan is 3% per year.

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