Russia's economic contraction slowed in the first two months of 1995, with GDP down just 4 percent from the same period in 1994, after declines of 15 percent in 1994 and 12 percent in 1993, the State Statistics Committee reported. The Russian daily, Finansovie Izvestia, adds that during January and February, real disposable income fell by 13 percent from December 1994. The volume of capital investments dropped by 28 percent from the corresponding period in 1994.

Russian Finance Minister Vladimir Panskov has announced that the budget deficit for 1995 has thus far been kept to about half the planned level, a result that should help reduce inflation. Monthly inflation in March is expected to be 6 to 8 percent, down from 11 percent in February and 18 percent in January. And for April and May it should be about 5 percent a month. Panskov said the deficit for the first two months of this year is six trillion rubles, or 8 percent of the 73 trillion rubles targeted for the whole of 1995. Sales of treasury bills raised 2.8 trillion rubles over this period, enabling the government to use only 3.2 trillion rubles in (inflationary) central bank credits—1.8 trillion rubles below planned ceilings. The figures show the government was realistic in planning to raise 32 trillion rubles on the domestic bond market this year, Panskov said.

External Economic Relations Minister Oleg Davydov has said that Russia plans to sign restructuring agreements with all its foreign creditors by the end of 1995. Davydov announced that deals would be struck, in turn, with the Paris and London Clubs, and then with individual creditors. He said talks with the Paris Club concerning about $34 billion of debt will begin in May. Russia wants to restructure its approximately $120 billion foreign debt total over at least twenty-five years.

Russia's Parliament has approved a budget for 1995. The budget envisages expenditure of 248.34 trillion rubles and income of 175.16 trillion rubles ($37 billion), leaving a deficit of 73.18 trillion rubles, or $15.4 billion at the current exchange rate.

The Governmental Center for Studies of Economic Conditions said 1.84 million Russians were officially unemployed in February this year, and projected the May jobless total at 2.24 million. Women and young people account for two-thirds of Russia's unemployed. But according to Ministry of Economy data cited by Radio Rossii, the number of unemployed and partly unemployed in fact totaled 10 million, or more than 13 percent of the working population.

The Russian government anticipates non-CIS exports to rise for 1995 to $49.1 billion, and total non-CIS imports to rise to $32 billion. Even allowing for a further rise in shuttle trade and other unrecorded imports, this would leave Russia with another substantial trade surplus. Exports for January-February were around $8.5 billion and imports about $5 billion. While exports were up 10 percent year-on-year, imports rose by only 3 percent. However, the poor 1994 harvest will lead to a significant rise in centralized imports of grain and sugar.

Russia's trade surplus for 1994 exceeded $10 billion. Exports to non-CIS markets rose 8.4 percent to $48 billion. Oil, gas, and petroleum products remained the principal sources of export earnings, bringing in a total of $20.3 billion, up from $19.3 billion in 1993. Export earnings of the entire machine-building sector amounted to $2.5 billion, as against $2.9 billion in 1993. The sector's share of total exports fell from 7.2 percent to 5.3 percent. The rise in exports to non-CIS markets came largely at the expense of CIS markets; oil exports to other CIS states fell by 20 percent last year, to 34 million tons. Imports from outside the CIS rose 5.2 percent to $28.2 billion. While wheat and corn imports fell roughly 80 percent, to 1.2 million and 900,000 tons, respectively, and cane sugar imports from Cuba were down 28 percent, at 1.2 million tons, imports of fresh-frozen meat rose 4.6 times to 387,000 tons; poultry imports rose 5.6 times to 411,000 tons; and butter imports rose 2.4 times to 171,000 tons.

Bulgaria's socialist-led government in March approved the state budget for 1995. The final draft of the budget provides for a deficit of 47 billion leva ($700 million), or 5.6 percent of GDP. Expenditures are estimated at 387 billion leva ($5.8 billion), and revenues at 340 billion leva ($5.1 billion). GDP is expected to amount to 800-850 billion leva ($12.0-$12.8 billion), while inflation is expected to drop to some 40 to 50 percent from a rate of 121.9 percent in 1994. The estimated budget deficit has risen from the previous year's 42 billion leva, because the government wants to allocate more money to the army and police. It also needs funds to finance its social projects. According to the daily, Otechestven Front, 20 percent of the budget deficit will be financed directly by the Bulgarian National Bank.

The final version of Bulgaria's privatization program was approved by the government in March; 20 billion leva ($300 million) in privatization revenues are expected for 1995. The government wants to privatize 600 enterprises, or 20 percent of all state-owned firms, by the end of 1995. Yosif Iliev, director of the Center for Mass Privatization, said that every Bulgarian citizen over 18 will receive privatization vouchers worth a total of 50,000 leva ($750). The final mass privatization scheme will be approved by the end of August or the beginning of September. A list of enterprises to be included in the first privatization wave will be drawn up at the same time.

Bulgaria will have to pay nearly $1 billion in principle and interest in servicing its foreign debt in 1995, according to National Bank of Bulgaria Governor Todor Valchev.

The Hungarian government announced that it would dismiss 19,000 civil servants as part of radical plans to slash state spending. Lajos Bokros, Hungary's finance minister, said the cuts would mean that budget-funded institutions would have to reduce their staff by around 15 percent in 1995. As part of a large-scale austerity package, the forint was devalued by 9 percent against a basket of currencies on 12 March. An 8 percent surcharge on all imports was introduced on 20 March and is to be levied until mid-1997. The government also implemented measures to cut consumption, including a limit on pay increases and the abolition of family allowances except for those to people with low incomes. Other elements of the program that are aimed at improving export competitiveness and curtailing consumption must be approved by the Parliament.

China should heed the lessons of the Mexican financial crisis and further restrain foreign borrowing, which reached $100 billion at the end of 1994, Zhou Shijian, deputy president of the International Trade Research Institute, has warned. China's debt-service ratio is deteriorating and Zhou urged the Chinese government to clamp down on enterprises and institutions raising capital abroad. (China's foreign exchange reserves, nevertheless, totaled $51.6 billion at end-1994, up $30.4 billion from 1993, and are at a suitable level, according to an official in the State Administration of Exchange Control.)

China has set its economic targets for 1995. The State Statistical Bureau has announced that inflation will be cut from 24.4 percent in 1994 to 15.0 percent, and that growth will be curtailed from 11.4 percent to 9.0 percent. The country's foreign trade is expected to grow by 12.2 percent to $275.35 billion in 1995. Exports will account for $143.88 billion, up 11.6 percent, and imports will reach $131.47 billion, up 13.5 percent.

Record imports forced Viet Nam's trade deficit up to $900 million in 1994 from $200 million the previous year. Exports grew marginally from $3 billion to $3.6 billion, while imports shot up from $3.2 billion to $4.5 billion.

In Slovakia real GDP growth for 1994 was 4.7 percent, after a 4.1 percent decline in 1993. The government has based its current budget on the assumption that this growth rate will be sustained, if not raised, in 1995.

The Cambodian government has discovered that its civil service rolls include 3,487 employees who don't exist but are being paid some $55,000 each in monthly salaries that end up in the pockets of corrupt officials, the Wall Street Journal (Europe) has reported.

Georgia will introduce its national currency, the lari, in the first half of 1995.

More than half of Ukraine's $4.4 billion debt to Russia has been rescheduled. The $1.4 billion owed to Gazprom will be paid out over twelve years with a two-year grace period. Russia has also agreed to reschedule $1.1 billion in official debt, accepting repayment over thirteen years with three-years' grace.

Estonia's Minister of Reform Liia Hanni told a news conference on 28 March that the majority of state-owned companies have been sold into private hands. The Privatization Agency sold 339 companies for 1.4 billion kroons ($112 million) in 1994, but as most contracts provided for payment by installments, privatization income amounted to only 431 million kroons. Among the major companies still to be privatized are Estonian Energy, Estonian Shipping Company, Estonian Railways, Estonian Air, and Estonian Oil Shale.

Oil-rich Kazakhstan is attracting more long-term foreign investment than any other country in the former Soviet Union or Eastern Europe, according to a United Nations survey released in late March. The study, by the United Nations Economic Commission for Europe, said Kazakhstan has attracted more than $46 billion in foreign investment commitments over the past five years, or 39 percent of the region's total. The largest long-term investor was the United States, followed by Turkey.

Slovakia has received an offer from the Czech firm Skoda Praha to finish two reactors at the nuclear plant in Mochovce. The European Bank for Reconstruction and Development (EBRD) was to have decided on 27 March whether to grant a loan to Slovakia to allow a Slovak-French joint venture to complete the project, but Slovak Deputy Premier and Finance Minister Sergej Kozlik asked the EBRD to delay its decision until April. The Czech offer undercuts that of Electricite de France by one-third. Russia offered in February to put up $150 million to help complete the plant.

The rump Yugoslav currency, the "super dinar," has come under intense inflationary pressure. The super dinar, which was introduced by National Bank Governor Dragoslav Avramovic in January 1994, has been pegged officially to the German mark at a rate of 1:1. Dealers in Kragujevac were selling one German mark for 2.7 dinars on 27 March, while in Novi Sad the mark fetched 3.5 dinars, and in Belgrade, 4.7-5.0 dinars.