Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, April 4, 1993 TAG: 9304040157
SECTION: NATL/INTL PAGE: A1 EDITION: METRO
SOURCE: FRED KAPLAN KNIGHT-RIDDER/TRIBUNE
DATELINE: MOSCOW LENGTH: Medium
GOVERNMENTS MAY GET IN WAY OF RUSSIAN ECONOMIC PROGRESS
As President Clinton makes his big pitch for helping Russia, the biggest obstacles to economic progress for the onetime Communist superpower may prove to be the U.S. and Russian governments themselves.A U.S. Commerce Department official, for instance, recently told Russian aerospace executives not to charge such low prices for their products because they were hurting American firms.
"The U.S. and European governments are not interested in Russian below-market pricing unfairly disadvantaging our companies," Sally Bath, director of the Commerce Department's aerospace office, told the English-language Moscow Times while on an official visit here recently.
At the same time, the U.S. State Department has been ready for nearly a year to launch a center that would give money to out-of-work Russian weapons scientists, so they can apply their skills to high-tech civilian projects. Yet the center has been unable to get off the ground because the Russian parliament has not yet approved its operations.
As Russian President Boris Yeltsin meets Clinton amid high promises and expectations of aid, both of them face major dilemmas.
Yeltsin must bring home a genuine U.S. commitment to help excavate the Russian economy out of its deep pit. Yet for political reasons, he must do so without appearing like a beggar, without letting the West set too many conditions on the money's release.
Clinton must reverse the widespread impression here that Western aid is a joke, in order to boost Yeltsin's political fortunes as the leader who can save Russia. Yet he must do so without simply throwing money away.
"You don't want to pour money into this country," said George Marquart, the head of Polaroid's Moscow office. "It will wind up in the wrong hands and do so very efficiently."
Marquart has long advocated what is fast becoming conventional wisdom in U.S. policy circles: carefully directed funds for very specific projects, which would remain completely under the donors' control.
Building houses for decommissioned military officers, mechanizing farms, repaving roads - any kind of construction "would be a very good thing here," Marquart said, since such projects would provide jobs, training and infusions of capital.
The problem is that projects here often take a long time to get moving.
For example, the World Bank has a project on the shelf to renovate the corroding gas pipes under the streets of Moscow. The undertaking would more than make back its costs with the energy saved by patching up the leaks. But the idea has been shuffled among various Russian ministries and the Moscow City Council. Nothing has even started to happen.
In this case, the inaction is due mainly to confusion or incompetence. However, in many cases it is due to active hostility.
For example, some U.S. officials believe, the project to help Russian weapons scientists has been held up by the Russian parliament because it was endorsed by the foreign minister, Andrei Kozyrev, whom the parliament's leaders despise.
The power struggle between Yeltsin and the parliament has also taken its toll on foreign aid.
One issue in this power struggle is the charge that Yeltsin and Kozyrev have allowed the West to dominate Russia - first by subjecting it to harsh economic austerity in exchange for fictitious aid, then by easing Russia out of export markets.
Yet even some Western economists here say Russia's low prices are more the consequence of the low value of the ruble than of any deliberate attempt to "dump" goods on the world market.