Socialist Forum: Russia’s Bondholders

Reply to P. L., Poplar.

In addition to commercial credits obtained by the Russian Government abroad, and unofficially estimated at between £200 million and £300 million, the Russian Government has raised large sums at home to help finance the new industries. The total sum so obtained, according to information given in the Moscow Daily News (Weekly Edition, January 5th, 1933), has exceeded the original estimate of 6,000 million roubles (£600 million) and has reached a total of over £1,000 million. £800 million of this is held by the Government direct, and the remainder by Government industrial undertakings. The interest paid to the bondholders is in most cases at 10 per cent., or more; on some issues there is no interest, but in its place the chance of winning a big lottery prize. The Moscow Daily News states that the bondholders number 40 million persons, “the vast majority of whom are workers and collective farmers.” No figures are given showing the extent to which a minority of wealthy individuals have large holdings. While the Russian Government is now trying to sell its bonds abroad it is certain that the major portion of the £1,000 million is held internally.

ED. COMM