#6 - JRL 7302
Russian, U.S. Presidents Advised To Concentrate On
Economics, Set Politics Aside
Izvestiya
22 August 2003
in Russian 22 Aug 03
Article by Aleksandr Livshits:
"RAFTA? (Russian-American Free-Trade Agreement)"
Vladimir Putin and George Bush became presidents in 2000. They announced new relations. They have been building them for three years. What are the first results?
Let's look in the portfolio of economic assets. We will see the market status of the Russian economy. The United States recognized it in 2002. The step was remarkable. Without exaggeration. We will also find several announcements and declarations. Also decisions on working groups and other useful papers. American agencies are slowly increasing our ratings. And every year the politicians suspend the Jackson-Vanik amendment. Although they never revoke it. The U.S. Eximbank has again guaranteed credits for Russia. However, in extremely moderate doses.
Trade? It is practically not growing. Although it is not falling. Neither one nor the other. Although business dialogue is adjusting. We meet more often. Things are good, and recognized as such. Investment, true, is declining. Last year America fell to eighth place. Even Cyprus and Luxemburg ended up ahead. In Russia the oil companies, General Motors, Ford, United Technologies, and Boeing are noticeable as before. Familiar faces. Known projects. And we have added our own. LUKOIL bought a network of gas stations. Norilskiy Nikel bought property.
That is apparently all. We close the portfolio. What do we feel? Yes, not much. Of course, there is no reason to talk about a collapse or decline. Economic relations are no worse than in the Yeltsin-Clinton period. The situation is stable, calm. As in any period of stagnation...
But, indeed, movement is possible. For a beginning it would be good to finish what we did not manage to do in the 1990s. Let's say, the agreement on protecting capital investments. It was drawn up 11 years ago, but still has not been ratified (by us). It is already obsolete. We should return to it. Change some things. Resign it. Pass it through Congress and the State Duma. Another example is outer space. Th
ere are still restrictions in the United States on deliveries to our enterprises. Old. From the time of the USSR. Are these all really up to date? Verify, sort through them, reduce the number -- this would be a real contribution to trade. They will not lift the prohibition on the sale of American supercomputers, although this was probably introduced under Brezhnev. Who needs it now?
The Americans swear at us because of chickens. But we also take offense at them. Since they suppress Russian steel. They let in titanium, ferrovanadium, and many other things unwillingly. They will not meet us halfway in the WTO. They continue to look at our banks askance. They subject them to discrimination. They say our banks fight badly against money laundering. And this is after Russia's having joined the FATF! It is incomprehensible.
It is noteworthy that the majority of problems are in trade. Earlier the Gore-Chernomyrdin Commission worked on this. However, like everything else, it passed into history. And an empty spot was left. Afterward, the Americans said, "Leave it that way. There is no need to develop a bureaucracy. Businessmen will get together and shake everything out themselves." Three years have passed. It turns out that there were many sessions, bit few needed decisions. It would be good to refill this place. For example, the Gref-Evans Commission. Make it specialized, but only on trade.
There is more. In 1994, the North American Free Trade Agreement (NAFTA) was created. The United States, Canada, and Mexico joined it. I note: no politics, no economic union and no common currency. Only the removal of barriers in the way of trade and services. For 15 years. The figures are surging ahead. Mexican exports in NAFTA have already been freed by 80 percent. And America and Canada trade with no import duties. The effect of integration is high. For everyone.
Why not think about joining it? The creation of a Russian-American Free-Trade Agreement (RAFTA). If, of course, the pluses exceed the minuses. Indeed, we respect trade liberalism. We carry it in front of ourselves, like a banner. Since we are approaching the WTO. We want freedom in our trade with Europe. We are drawing several CIS countries there. The United States, Canada, and Mexico are no worse, and in some cases may be better.
The moment is felicitous for NAFTA as well. Russia for now is alone. It is not joining any zones. It has no obligations. The bride is ready for marriage. Moreover, as they say, with room to spare. But there are many suitors. But only talk. This is the time to court. To get ahead of the others. There is already a precedent. The United States once passed ahead of the European Union. When it gave Russia market status first. They could try again. The Americans love being first...
Specialists will smile: a fantasy. No. It is a topic for thought. If, of course, we want a new quality of relations with America and are ready for it. What will, in fact, happen? We will find out in September. When the promised meeting between the leaders of Russia and the United States takes place. The first leaks are already appearing. The main thing: much about economics is expected. That would be good. Should politics rush ahead, balance is lost. It is time to even things up.
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