Clinton rallies support for Russia Bigger aid program from West planned

THE BALTIMORE SUN

WASHINGTON -- President Clinton moved quickly yesterda to gather support for his "aggressive" new aid program for Russia from U.S. lawmakers and cash-strapped foreign leaders.

He talked to Prime Ministers John Major of Britain and Brian Mulroney of Canada, members of the Group of Seven leading industrial nations, but released no details of how willing they were to share the load. He will seek German Chancellor Helmut Kohl's support tomorrow, although Germany already has contributed more to Russia than has any other Western country.

The president also dispatched Secretary of State Warren M. Christopher to Capitol Hill to persuade skeptical legislators that additional aid extended to Russia would be money well spent. Mr. Clinton plans to invite key legislators to the White House zTC before his summit with Russian President Boris N. Yeltsin in Vancouver, Canada, early next month.

The aid package would funnel billions of dollars more in bilateral and multilateral support to the battered Russian economy, which received $20 billion in Western help last year.

According to a congressional staffer who was present at Mr. Christopher's closed-door session with more than 100 congressmen of both parties, the secretary of state received a generally sympathetic hearing from the bipartisan group of representatives. But they told him that if the administration wants to spend more on Russia, it should make sure that other nations, particularly the Saudis and the Japanese, dip deeper into their pockets.

Mr. Christopher stressed that giving more aid is vital to the survival of democracy in Russia, and he asked the legislators to convince their constituents of this. Foreign aid is not a popular issue with deficit-conscious legislators and voters these days.

Asked at a White House meeting with Russian Foreign Minister Andrei Kozyrev how he would overcome popular resistance to giving more aid to Russia, Mr. Clinton said: "I would tell the American people what I've been saying for well over a year now, that it is very much in our interest to keep Russia a democracy, to keep moving toward market reforms, and to keep moving toward reducing the nuclear threat."

Mr. Clinton said supporting democracy would save the United States billions of dollars in defense outlays, and enable it to make billions more through future trade, while also making the world a safer place. He added: "So I think it is a good investment for America."

Mr. Kozyrev, asked what aid Russia needs, replied: "We don't call it aid. Today, in the United States, the thought of aid is not popular, and in Russia also. We're talking about mutual cooperation." Among the areas of possible cooperation, he said, were atomic energy, space programs and defense conversion.

The package Mr. Clinton will propose to Mr. Yeltsin is likely to include both bilateral and multilateral initiatives on debt relief, humanitarian aid and technical assistance.

Among the moves currently under consideration are:

* A rescheduling of at least $18 billion of the $80 billion debt left by the old Soviet Union, an increase of $3 billion over last year.

* An increase in direct aid from the industrial world, from $11 billion last year to up to $14 billion this year;

* An increase in U.S. aid to Russia from the $700 million provided in the Clinton budget to as much as $1 billion;

* A program to finance the sale of U.S.-manufactured oil and gas drilling equipment to Russia, a market estimated to be worth as much as $2 billion. The equipment could be paid for directly from the sale of the oil and gas. But an estimated one in six wells is reported to be idle because of a lack of replacement parts.

* An increase in the shipment of U.S. food stocks, military surplus medical supplies and field hospitals, and in housing for troops returning from Eastern Europe.

* Technical assistance through increased sponsorship of business, industrial, commercial and student exchange programs to speed Russia's transition to a free-market, modern democracy.

But it won't be easy. With its politics in chaos, its economy in tatters and its future in question, Russia presents a major challenge to donor nations.

"My general feeling is that it's a rat hole," said Richard Starr of the Hoover Institution, Stanford University, Calif. "You can dump millions and millions down there, and it isn't going to help any. They just are not in a position to absorb the funds."

Aid to Russia last year from the industrial nations amounted to $12.6 billion, $1.6 billion more than expected because of escalating need. Deferred debt payments amounted to $7.2 billion, $4.7 billion more than anticipated as a cash-strapped Russian government urgently and successfully sought more relief from its creditors.

But the International Monetary Fund (IMF) has advanced just $1 billion of the $4.5 billion credit earmarked for Russia because of a lack of progress in economic reforms. The other $3.5 billion would become available once the reforms are in place.

The World Bank, impressed with progress in the privatization program, signed a new line of credit for the Russians earlier this month.

A $6 billion ruble stabilization fund made available by the World Bank and the IMF has not been activated because the market value of the ruble has yet to be firmly established. But the funding could be tapped once the Russian currency finds a firm footing, a prerequisite for economic stability.

The Russian government has not yet presented its economic plan for 1993 to the World Bank and the IMF, but the IMF estimates that Russia will need at least as much financial support in 1993 as in 1992 -- $20 billion.

"The idea we are going to take this enormous entity [Russia] and with $24 billion, or $100 billion, and turn it around in a year or two, I think is nonsense," said Paul Goble, senior assistant at the Carnegie Endowment for International Peace and a former State Department analyst on Soviet nationalities.

"That doesn't mean we should not help. I am in favor of helping . . . but I don't think we can matter nearly as much in the short-term as we think we can. Our ability to save Yeltsin, or save Russian democracy, is profoundly limited in the short-run. Nothing we can do would cut into the Russian political system enough to override the forces at work there."

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