Bush Aid Plan Aims to Bolster Yeltsin Reforms
President says United States can't afford setback in mending former soviet economy. HELPING FORMER SOVIETS
WASHINGTON — IN a strong endorsement of the Yeltsin-driven reform process in the former Soviet republics, the Bush administration announced this week a long-awaited plan to assist the reformers with roughly $4.5 billion to $6.5 billion.
Unveiling the package on Wednesday, President Bush warned that the United States cannot afford a setback in the former communist empire's transition toward democracy and market economics. "The cost of risking doing nothing could be exorbitant," he said.
Neither Secretary of State James Baker III nor Treasury Secretary Nicholas Brady could provide exact figures on US commitments, but both stressed that the pledges are part of existing appropriations and require no new outlays.
Joined by the Group of Seven major industrialized countries, which includes the US, Britain, Canada, France, Germany, Italy, and Japan, and global financial institutions, the US will contribute toward an $18 billion international fund to cover shortages in Russia's balance of payments.
Congress is expected to ease cold-war trade and finance laws that have prevented the US Export-Import Bank and the Overseas Private Investment Corporation from expanding their operations in the now-defunct Soviet Union.
Through its contribution to a rainy-day fund administered by the International Monetary Fund (IMF), the US has already authorized roughly one-fourth, or $1.5 billion, of a $6 billion fund now needed to stabilize the ruble.
On April 28 and 29, when the world's finance ministers convene here for IMF/World Bank meetings, Russia is expected to work out an IMF-managed economic austerity program that will soon make the country eligible for the stabilization fund.
Mr. Bush has vowed to press Congress to honor the $12 billion US share of the IMF's capital replenishment. Bush also calls for an additional $1.1 billion in credit guarantees for the purchase of US grain. Russia will receive $600 million (adding to $450 million announced earlier this year), leaving $500 million for Ukraine, Armenia, and other states.
According to a top administration official, "It's no coincidence that the package was proposed before April 6, when the Russian parliament meets." At that time, fast-paced economic reforms led by Russian President Boris Yeltsin and former Finance Minister Yegor Gaidar may be subject to a disabling no-confidence vote. (Clinton's foreign policy address, Page 3)
To help stave off that possibility, two top members of the Russian parliament have made the rounds in Washington in recent days to solicit a strong US commitment to democratic reforms, now under attack in Moscow.
The visiting legislators, Lev Ponomarev and Russian Orthodox Church leader Father Gleb, spearheaded the investigation into the roles of the Communist Party, the KGB, and the military in the August 1991 coup attempt. The two men co-chair the Democratic Russia Party. They impressed upon Bush's national security adviser Brent Scowcroft the imminent threat of a resurgence of hard-line rule.
"The burning issue right now is whether Russia's Democratic forces win or lose. It's whether the government stays or goes," Mr. Ponomarev said in a Monitor interview. If Mr. Gaidar is voted out, "there will be another government, with a far more conservative agenda," he says.
According to Ponomarev, an ominous sign is that Gaidar's investigation was recently stopped by the speaker of the Russian parliament "because we were exposing those who remain very involved in politics and the security apparatus." Domestically, US politicians have been flashing their own warning signs at the White House. Former President Richard Nixon gained national attention with his recent attack on intransigent US policymakers whom he blamed for risking crisis in the former Soviet Union.
And a bipartisan congressional group - including Armed Services Committee Chairman Sen. Sam Nunn (D) of Georgia and prominent foreign policy broker Sen. Richard Lugar (R) of Indiana - has lobbied hard for the White House to take a more active role. Mr. Lugar expects the plan to win congressional approval by June.
"All of this can be seen as pressure on Bush, but it's also been good in preparing the [public opinion] ground for the White House package," says the administration official. "It's now easier for us to do something without being attacked for wasting money on foreign affairs when the focus should be on repairing the domestic economy."