Russia grants Hungary deferral on loan to build Paks-2 NPP

MOSCOW. Aug 17 (Interfax) - Russia has granted Hungary a deferral for payments on a loan to build the Paks-2 Nuclear Power Plant, changes to the schedule of the intergovernmental agreement, which were published on the official website for legal acts, showed.

The deferral applies to payments from the period from March 1, 2022 to the date on which the schedule goes into effect, so it covers interest and commissions on the unused amount of the loan for 2021-2022. In the case of 2021, interest on the unused amount is accrued from April 1, 2022 and in the case of commissions for 2022 interest is accrued on debt from April 1, 2023.

This debt must be paid "no later than 30 calendar days after the date on which the present schedule goes into effect." If Hungary pays it on time, it will not be considered overdue, so interest will not be accrued on it, the document said.

The document also stipulates that all payments on the loan will be made in euros.

The schedule with the changes will go into effect "as of the fifth calendar day after the date of the receipt of written notification through diplomatic channels about the parties' fulfilment of internal government procedures necessary for it to take effect."

Bloomberg reported that on August 15 the Hungarian government published a document that mentioned the deferral.

Hungary's parliament approved the expansion of the country's only nuclear power plant, the Soviet-designed Paks, in 2009 with the construction of another two generating units. The cost of the project was estimated at 12.5 billion euros. In 2014, Moscow and Budapest signed an agreement on a long-term loan of up to 10 billion euros for the construction of Paks-2.

Hungary's Atomic Energy Authority granted Russian state corporation Rosatom a permit to build the fifth and sixth generating units of the Paks plant at the end of August 2022. In May 2023, the European Commission approved amendments to the agreement on the construction and financing of the project.

Rosatom said earlier that the first concrete at Paks-2 could be poured in 2024.