Debt swapping as a tool for economic and social stabilization in Russia's closed nuclear cities

The magnitude of Russian foreign debt, both official bilateral and commercial, compounded by collapse of the Russian economic system, is an obstacle in preventing the Russian Federation from effectively increasing the domestic priority of drawing down its nuclear weapons complex and providing a healthy, competitive environment to its nuclear cities. Debt-for-nature swaps, introduced in the early 1980s, provide debtor nations with a means of converting a portion of foreign debt into local currency, often at steep discounts, to use for purposes such as environmental protection that serve both a domestic and international need. This paper presents the debt-for-nature concept as a model for providing an infusion of funds to further U.S. and international nonproliferation objectives to help stabilize Russian closed city economic conditions through direct work on proliferation problems and remediation of the environment. A specific proposal is presented to demonstrate the utility and efficacy of the dept swap concept through initial collaboration with the city administration of Ozersk. The purpose of the proposal is to facilitate making Ozersk a safe, healthy competitive city, providing useful employment for its scientists and population and converting its superior infrastructure into productive activities.