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Hungary repays first drawdown of Paks loan

Hungary will make an early repayment of EUR 78.2 million previously drawn for financing the upgrade of the Paks Nuclear Power Plant, Minister for National Economy Mihály Varga told Tuesdayʼs issue of business daily Világgazdaság.

The repayment allows Hungary to save interest and is made possible by the strong performance of the Hungarian economy and the favorable situation on international money markets, Varga told Világgazdaság. Hungary is paying 3.95% interest on the Russian financing for the upgrade while two more reactors are built at the Paks plant, he added.

Under the loan contract with Russia, Hungary may make early repayments without penalty, Varga said, adding that Russian Minister of Finance Anton Siluanov was informed of Hungaryʼs intention to make the early repayment on Monday.

The payment must be transferred within 90 days. However, maintaining the credit line provided by Russia is necessary in the long term as it ensures stability for the Paks 2 project, Varga noted.

The investment at Paks aims at providing cheap and safe electricity to Hungarian private and industrial consumers for decades, the minister said.

Hungary started drawing down the EUR 10 billion loan from the state of Russia last November.