BERLIN (AP) - Germany's Finance Ministry dismissed a published report Sunday that Chancellor Gerhard Schroeder had agreed to slash Soviet-era debt owed by Russia.

Russia and Germany have been deadlocked for years over how to value Soviet debt run up with former communist East Germany before German reunification in 1990.

Capital, a German business magazine, reported Sunday that Schroeder was now expected to offer Russia an exchange rate that would cut the amount owed from a previously assumed $6.9 billion to some $1.8 billion.

A Finance Ministry spokesman said Russian and German officials are in negotiations to settle the debt, but insisted that no such offer was in
the works.

``There is no decision,'' said the spokesman, speaking on customary condition of anonymity.

``No such offer has been made.''

The Soviet-era debt amounts to 6.5 billion transferable rubles, an accounting unit used in the former Soviet bloc's trade accounts. The two sides have disagreed over which exchange rate to apply.

Schroeder and Russian President Vladimir Putin have discussed debt at four summits since last year -- most recently this month -- but the topic has remained a persistent obstacle toward better relations.

After their last summit in St. Petersburg, both leaders said only that their finance experts would continue talks. Plans to settle part of the Soviet debt to East Germany by offering German companies shares in Russian enterprises have also failed to get off the ground.