TASS. The Finance Ministry of Russia does not rule out the possibility of floating yuan-denominated federal loan bonds (OFZs) in 2017, but a lot depends on the ability of Chinese financial authorities, Konstantin Vyshkovsky, head of the Finance Ministry's Debt Department, said at the Russian Investment Forum in Sochi.
According to him, the ministry's previous statements that the flotation of these securities this year is unlikely are not the ministry's final decision.
"This is not a final decision. We said that the likelihood of placement this year is not very high or substantially lower than we previously planned. And this is mainly driven by the position of Chinese authorities. We are ready to execute this project. But, as fine-tuning of this issue showed, our idea, to a certain extent, runs counter to the overall policy pursued by Chinese financial authorities in order to limit a capital flight from China," Vyshkovsky said.
Meanwhile, he noted that the Finance Ministry does not consider any alternatives to yuan-denominated OFZ because this instrument was engineered not as a means to fund the budget deficit, but as an attempt to draw a new category of investors to the Russian market.
"This is an attempt to test a new market segment, to bring to our market, Russian infrastructure a new category of domestic Chinese investors, the so-called mainland investors. It is not advisable to consider this as any instrument designed to replace other current ones. This is just the aspiration to develop the market, an attempt to find any alternative sources of funds. We are not going to take this project off the agenda completely, we'll continue cooperation with our Chinese counterparts to explore this option," Vyshkovsky said.
