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1. USA Today: Bill Nichols, U.S.-Russian relations chilliest since Cold War.
2. AP: Putin Almost Certain for Another Term.
3. Nezavisimaya Gazeta: IVANOV IS NO LONGER AMENABLE. The Foreign Ministry tries to trade the Strategic Offensive Reductions Treaty for an end to the war in Iraq.
4. AP: Russian Not Happy With U.S. Spy Flights.
5. Kommersant: AMBASSADOR VERSHBOW: FOR SADDAM, THERE IS A PRESUMPTION OF GUILT. An interview with US Ambassador to Russia Alexander Vershbow.
6. Reuters: Russia says to defend post-war Iraq oil interests.
7. Luba Schwartzman: TV1 Review.
8. http://www.inthenationalinterest.com: Yevgeny Verlin, A Most Dangerous Game: Russian Gambles, American Distractions.
9. Gazeta: Ivan Yegorov, IRAQGATE. Who sold American weapons to Saddam Hussein. If Iraq really had our systems, American casualties would be much
10. Wall Street Journal: Robert Goldberg, The Russian Strain.
11. Moscow Tribune: Stanislav Menshikov, BEWARE DANGEROUS PARTNERS. Dragging feet at the UN.
12. Profil: EXPANSION OF THE STATES. Alexander Zinoviev: The Iraqi events are just an episode in the war for global leadership which the United States
has been waging for years
13. pravda.ru: Foreign Investors Forget about Russia. Western experts believe that Russia is still retarded.
14. American Outlook Today (Hudson Institute): Peter Brownfeld, The Afghanization of Chechnya.
15. Moscow Times: Alexander Sokolowski, Putin Should Join the Party.


USA Today
March 27, 2003
U.S.-Russian relations chilliest since Cold War
By Bill Nichols, USA TODAY

WASHINGTON Russia stepped up its criticism of the U.S.-led war in Iraq
Wednesday as foreign policy analysts warned that U.S.-Russia relations are
approaching a post-Cold War low that could have serious repercussions in
the future.

U.S. and British efforts to overthrow Saddam Hussein's regime are "illegal
and doomed to failure," Foreign Minister Igor Ivanov told Russian
legislators Wednesday. "What democracy are they talking about when they are
trying to completely destroy the country?"

The Russian Foreign Ministry released a statement demanding an end to the
war, in light of reports that a U.S. missile attack killed 14 Iraqi
civilians in Baghdad.

The harsh statements came as tensions continue to mount between the United
States and Russia. In recent days, the Russian parliament refused to ratify
a key nuclear disarmament treaty the U.S. Senate has already approved, and
Russian diplomats have blocked U.S. efforts to involve the United Nations
in overseeing humanitarian aid in Iraq. For their part, U.S. officials have
accused Russia of aiding the Iraqi war effort with sales of key military

A serious falling-out between the two nations threatens U.S.-Russian
cooperation on several issues, including Russian help the United States has
counted on in anti-terrorism efforts in central Asia.

President Bush met Russian President Vladimir Putin in Slovenia in 2001 and
famously said he had looked into Putin's eyes and "was able to get a sense
of his soul."

But U.S. officials say their view of Putin's soul is more opaque at the
moment. Washington and Moscow had similar disagreements about the U.S.-led
air attack on Yugoslavia in 1999, but were able to restore good relations.
In the current crisis, however, there is a sense the dispute could spin out
of control. U.S. Ambassador to Russia Alexander Vershbow has said the rift
has created "serious tension."

Not only did Moscow stun the White House by resolutely opposing direct
United Nations backing for the war, but this week, the administration
accused Russian companies of providing Iraq with anti-tank guided missiles,
satellite jamming devices and night-vision goggles. Bush called Putin to
complain about the alleged sales.

Russia denied those charges, though Secretary of State Colin Powell said
Ivanov, in a phone conversation Wednesday, promised a full investigation
and said Russia does not "want this to be an irritant in our relationship."

The public disagreements have led some veteran U.S.-Russia watchers to fear
that if the increasingly heated rhetoric does not cool soon, the
relationship could suffer permanent damage.

"Both sides have lots at stake to not allow the relationship to deteriorate
further," says Ariel Cohen, a Russia analyst at the Heritage Foundation.
"Things are worse than they should have been."

Diplomats representing countries on the U.N. Security Council say a large
part of the problem resulted from a basic miscalculation by the Bush
administration when it assumed Putin would not veto a council resolution
that would lead to war in Iraq.

Veto threats by Russia and France helped force the United States and
Britain to withdraw the resolution without a vote on March 17, a major
diplomatic embarrassment.

Diplomats say Washington assumed Russia would abstain, and never offered
Putin any written guarantees that he would be able to recover more than $20
billion in Russian debt and oil contracts in a post-Saddam Iraq.

Another contributing factor: Putin has suffered strong criticism at home in
the wake of Bush's decision to withdraw from the 1974 Anti-Ballistic
Missile Treaty. Many in Russia feel that Putin has received little in
return for his strong support for Bush since the Sept. 11 terrorist attacks.

Sentiment in Russia has tilted sharply against the United States. A poll
conducted earlier this week found a dramatic rise of anti-American
sentiment, with 55% of Russians saying they view the United States
negatively, up from 15% in a similar poll last summer.


Putin Almost Certain for Another Term
March 26, 2003

MOSCOW (AP) - President Vladimir Putin has failed to end the conflict in
Chechnya or avert war in Iraq, and his term has been marred by the Kursk
submarine disaster and the hostage-taking raid on a Moscow theater. Yet,
his re-election seems assured.

On the three-year anniversary of his election Wednesday, polls and
political analysts suggest Putin won't face much of a challenge if he seeks
a second term next March.

``If nothing absolutely extraordinary happens, I think his re-election will
be almost automatic,'' said Nikolai Petrov, director of the Moscow-based
Center for Political and Geographical Research. ``It's hard to imagine what
could ruin his chances.''

Since his election three months after his predecessor Boris Yeltsin stepped
down on New Year's Eve 1999, Putin has managed to weather much suffering of
the Russian people without suffering much himself.

In August 2000, he was roundly accused of being callous for staying on
vacation after the submarine Kursk exploded and sank in the Barents Sea,
killing all 118 sailors aboard.

In a blow that seemed to make a mockery of Putin's pledges to eradicate
militants in Chechnya and keep order in his country, Chechen rebels raided
a theater near downtown Moscow last October - a crisis that ended with 129
captives dead, most from the knockout gas Russian forces pumped in.

``He promised to swiftly solve the Chechnya problem. It has not been
solved, terrorists come to Moscow, and as a result - Putin's personal
rating rises,'' said Petrov, describing what he said some analysts call the
``mythical nature'' of Putin's popularity.

But both Petrov and Yevgeny Volk, head the Heritage Foundation's Moscow
office, also cited concrete reasons for Putin's popularity: Boosted by high
oil prices, Russia's economy has grown during Putin's term and inflation
has been moderate.

``Relative economic stability has been provided,'' Volk said. Stability is
a key factor for a population buffeted by years of post-Soviet decline
followed by a surge that ended painfully with the ruble's collapse in 1998.

Putin, who met Wednesday with leaders of United Russia, a political party
created to support him, has not announced a re-election bid, but is widely
expected to run. Recent polls offer little reason he should not.

In a survey by the Public Opinion Foundation, about 42 percent of
respondents rated Putin's work as excellent or good. The same amount said
it was satisfactory, with only 10 percent giving him a bad rating.

The group said it interviewed 1,500 people in 44 regions across Russia on
March 22-23. It did not give a margin of error.

A poll by the Agency for Regional Political Research found that 82 percent
of those who voted for Putin in 2000 felt they did the right thing,
according to the Interfax news agency. Six percent said they regretted
their vote.

The group polled 1,600 people in 28 regions, Interfax said. The report did
not give a margin of error.

Volk said no politician has the power or popularity to turn ``the
difference between what Putin promised and what has been done'' into an
election victory. ``I don't see any political figures in the Russian arena
who could really take advantage of that,'' he said.


Nezavisimaya Gazeta
March 27, 2003
The Foreign Ministry tries to trade the Strategic Offensive Reductions
Treaty for an end to the war in Iraq
Author: Yuliya Petrovskaya
[from WPS Monitoring Agency, www.wps.ru/e_index.html]
Ivanov speaks out on the war and the Strategic Offensive Reductions Treaty

Addressing the Federation Council yesterday, Foreign Minister
Igor Ivanov proposed postponing ratification of the Strategic
Offensive Reductions Treaty. "The timing is psychologically wrong,"
the minister said. "We will return to the Strategic Offensive
Reductions Treaty when the resolution of the Iraq crisis has returned
to the jurisdiction of the UN Security Council."
Ivanov repeated President Vladimir Putin's words that the war in
Iraq is a grave political error. (This phrase of Putin's unnerved
Washington a week ago.)
"Russia will continue objecting to all attempts to directly or
indirectly legitimize the use of force against Iraq or shift
responsibility for it onto the international community represented by
the UN," Ivanov announced. Moscow will view all draft resolutions on
Iraq presented to the UN Security Council from this angle.
Ivanov emphasized that "Moscow has the right to strive to ensure
that its legitimate economic interests in Iraq are respected", and
denied Washington's claims that Russian companies had allegedly
exported arms to Iraq in defiance of the embargo.
Observers view Ivanov's speech in the Federation Council as
extremely sharply-worded. There are speculations in Moscow and in the
West that Russia is on the verge of declaring a diplomatic war on the
United States. Russian-US relations deteriorated noticeably over the
allegations that Russian-made military equipment had been exported to
From the political angle, events have taken the worst possible
turn for Russia. By linking ratification of the Strategic Offensive
Reductions Treaty with the war in Iraq, Russian diplomacy is proposing
to shelve a treaty which it acknowledges as being in Russia's own
interests. As for the psychological aspect of the matter (Ivanov
himself mentioned this), it may deteriorate - and will certainly
deteriorate if the United States prevents Russia from taking part in
post-war restoration of Iraq.
"I can tell you right here and now that this treaty promotes the
interests of Russia and the United States. Moreover, it does not
encroach on the signatories' security," Ivanov said on the eve of the
signing of the Strategic Offensive Reductions Treaty. This assessment
of the treaty remains true, war or no war.
The Strategic Offensive Reductions Treaty cannot be a tool to be
used by Russia for the purpose of promoting its interests in Iraq. On
the other hand, Ivanov's statement may well become an additional
irritant in Russian-US relations. Who knows - what if the Americans
decide to take some old files from the shelf and dust them off - the
files on freedom of the press, human rights, Chechnya...
Russian and American observers are using the term "Cold War" more
and more frequently in connection with the future of Russian-US
The United States criticized France and Germany as its least
reliable partners before the war began. But now it is Russia that is
getting all blame. Anti-American rhetoric from Paris and Berlin is not
as loud as before. And damage to trans-Atlantic relations, whose
strategic nature is never doubted by Washington or Europe, cannot be
compared with the political and economic risks Russia is taking. In
short, Moscow is running the risk of being left isolated.


Russian Not Happy With U.S. Spy Flights
March 26, 2003

MOSCOW (AP) - Russian Defense Minister Sergei Ivanov said Wednesday that
Moscow was not satisfied by U.S. explanations of the need for
reconnaissance flights over neighboring Georgia.

Russia scrambled two fighter jets Saturday to track a U-2 spy plane that it
said was flying near the Russian border. The Foreign Ministry delivered a
statement of protest to the U.S. Embassy, accusing Washington of Cold War

``We have asked the U.S. to explain to us the need for such flights,'' the
Interfax news agency quoted Ivanov as saying. ``The U.S. says such flights
are necessitated by the fight against terrorism on Georgian territory. We
cannot accept these explanations ... and will not accept them.''

A senior U.S. diplomat said Washington had informed Moscow in advance about
plans to conduct reconnaissance flights over Georgia and Azerbaijan.

``Aerial reconnaissance is one way to try to track the movements of
terrorist groups,'' the diplomat said on condition of anonymity, adding
that such flights could benefit Russia in its fight against Chechen
separatists, who Moscow claims are aided by international terrorist groups.

But Ivanov said it would be impossible to spot terrorists from the
high-flying U-2, but it would have no problem spotting Russian military

The senior U.S. diplomat said the flights were far from the Russian border.
Russia says the spy plane flew 12 to 20 miles from its territory.

The diplomat said Washington had not decided whether it would take up
Georgia's offer to allow U.S. forces to use its air bases in the war
against Iraq.

Georgian President Eduard Shevardnadze, who has tried to ally his Caucasus
Mountains nation with the United States as a counterweight to its huge
neighbor, last week expressed strong support for the U.S.-British attack on

The United States has identified the Pankisi Gorge, a rugged border region
of Georgia next to Russia's breakaway Chechnya, as a possible haven for
Islamic militants linked to Osama bin Laden's al-Qaida network. Georgia,
which turned down Russian offers to rid the region of fighters, last year
accepted Washington's help in forming its own anti-terrorist units to fight
the militants.


March 26, 2003
An interview with US Ambassador to Russia Alexander Vershbow
Author: Boris Volkhonsky
[from WPS Monitoring Agency, www.wps.ru/e_index.html]

US Ambassador to Russia Alexander Vershbow was interviewed
yesterday at the offices of Kommersant.
Question: How would you comment on the fact that the war has been
underway for five days, but the US has still failed to produce clear
evidence that Iraq poses a threat?
The specific threat is that the Baghdad regime does not want to
give up programs for developing weapons of mass destruction, and
supports terrorist groups. A particular danger is that terrorists
might obtain weapons of mass destruction from Saddam Hussein's hands.
I would describe another threat as a challenge to what is called "law
and order". By ignoring UN resolutions, Saddam Hussein's regime
undermines UN authority. Of course, no one wants to resort to military
force, but at this point all avenues for resolving the problem
peacefully have been exhausted.
We are dealing with a regime that launched two wars of
aggression; and starting from 1991 there have been several resolutions
of the UN Security Council (SC) which Iraq was obliged to carry out.
In particular, the obligation to disarm was the exact condition of the
cease-fire in 1991. If you like, there is a presumption of guilt in
this case, and it is Saddam who is obliged to produce proof of
disarmament. He was lying for four years, until his brother-in-law
fled to the West. So many files proving the existence of weapons of
mass destruction in Iraq were discovered only due to the information
he provided. After 1998 when inspectors left Iraq, Saddam has never
reported on thousands of tons of toxic substances. Finally, when UN
inspectors submitted a report in December last year, Saddam continued
to ignore the will of the international community.
Question: If so, why does most of the UN Security Council hold
different views from those of America?
Alexander Vershbow: None of the UN Security Council members
denied that Saddam did not execute requirements of resolution 1441.
Commission chief Hans Blix noted many incidents of violations or
deviations in Iraq's report from what inspectors had discovered. True,
there are differences between SC members concerning methods and
tactics. And we are very sorry that countries that signed resolution
1441 have presently turned right back trying to interpret it in a new
way. Resolutely declining application of force, therewith they
weakened pressure on Saddam Hussein. Our task presently is to achieve
a consensus to restore the UN authority it lost because of actions of
a number of countries. We see a great role of the UN in the post-war
settlement in Iraq. In particular, concerning humanitarian aspects. On
the whole, we do not feel that we are alone or isolated in the world
because of our policy. The coalition of states supporting our actions
grows every day.
Question: Practically the same charges the US puts forward
against Iraq can be made against Kim Jong-Il's regime. Why don't you
present any ultimatums to North Korea?
Alexander Vershbow: We believe that North Korea is developing
programs to create nuclear weapons, which is a serious threat for East
Asia and the world in general. The UN Security Council should look
into this issue more resolutely, more so, that the International
Atomic Energy Agency (IAEA) raised this issues to the SC a month ago.
The IAEA discovered facts that North Korea violated the Non-
proliferation Treaty. However, so far we assume that the North Korea
problem can be solved diplomatically. By the way, we count on Russia
to be more active in exerting political pressure on North Korea to
bring Pyongyang to the negotiating table. This negotiation should be
multilateral, as the threat directly concerns a lot of countries.
However, if the situation is not improved, we do not rule out any
Question: How would you assess that damage that the war has done
to Russian-American relations already?
Alexander Vershbow: Of course, some political tension has arisen
between the two states, but we managed to avoid specific damage. Both
our presidents confirm their resolve to keep our relationship on
track, and this was part of what they discussed in their telephone
Question: Why does disagreement with France provoke a more acute
response in the US than with Russia?
Alexander Vershbow: France actively participates in the anti-
American campaign. This is very strange, for France supported
resolution 1441, but it has seemingly forgotten what is written there
and started to threaten that it would veto any draft whatever it
should read. You know, Chirac had rejected one of the draft
resolutions before Iraq did this. Our differences with Russia are also
significant, but we allow for President Putin's appeal to minimize
damage to bilateral relations and to keep down emotions to prevent any
rise in anti-American views.
Question: What do you think in this light about charges that some
Russian firms supplied dual-use products to Iraq?
Alexander Vershbow: This is a very serious issue, and we have
definite disappointments connected with it. As far back as last summer
and autumn we raised the issue to Russia about providing Iraq military
technologies, including jamming devices against the GPS system, and we
expected that measures to cease such supplies would be more vigorous.
We are convinced that proofs of such supplies are substantial, in
spite of statements of Russian government representatives and the
chief of one of the companies. Of course, we will cope with Iraq even
when it possesses such technology, but this creates additional
difficulties. This issue is not closed yet though, and President Bush
told journalists yesterday that in their conversation President Putin
had promised to look into that problem once again.
Question: What place do you reserve for Russia in post-war
development of Iraq. Will Russian companies preserve their presence in
that country?
Alexander Vershbow: We hope to involve Russia and other UN
Security Council member states in discussion of political and economic
aspects of reconstruction in Iraq. We take Russian business interests
into account, but it should be noted that oil belongs to the people of
Iraq, so the new Iraqi government will decide how to dispose of it.
Question: But who will install this new government?
Alexander Vershbow: We see three stages of that process. At the
first stage, Iraq will be government by a military administration
formed by the coalition. Then an interim government will be created
like the one set up in Afghanistan. It is to include representatives
of all ethnic and religious groups. It is so far undecided how exactly
this will look; the UN is to say its word yet. Finally, during another
couple of years conditions will be created to conduct democratic
elections in this or that form. Our goal is to restore the self-
government of Iraq and withdraw troops as soon as possible.
Question: The Shiites make up most of Iraq's population. Are you
afraid of getting an Islamic Republic of Iraq, like Iran?
Alexander Vershbow: This would not be the most desirable option.
But a government expressing Shiite interests should not necessarily be
a government of Ayatollahs. Besides, Iraq's Shiite of the present are
more adherent to temporal principles than Iran's 25 years ago. We will
not dictate the people of Iraq what government they should elect, but
world security demands that Saddam's regime should be overthrown.
Question: In one of your recent interviews you threatened that
Russian-American relations would worsen if Russia used its veto. Do
you wish you hadn't said that?
Alexander Vershbow: I just expressed my concern that our
relations might suffer.
(Translated by P. Pikhnovsky)


Russia says to defend post-war Iraq oil interests

MOSCOW, March 27 (Reuters) - Russia on Thursday moved to defend its oil
interests in Iraq, saying it would insist that Russian oil company
contracts with Baghdad be honoured after the U.S.-led war to overthrow the
government of Saddam Hussein.

Energy Minister Igor Yusufov said Russian oil companies should be involved
in the reconstruction of Iraq's oil infrastructure as soon as the war was

"We are currently working on the immediate return of Russian firms, which
have interests in Iraq, to the country as soon as peace is restored,"
Yusufov told local news agencies.

His comments came after some Russian oil bosses said they were sceptical
about the prospects of keeping multi-billion dollar deals in a post-Saddam
Iraq, especially after the United States began this week to hire its firms
to rebuild the Iraqi oil industry.

"They should return to their projects, evaluate the situation with the
equipment left and start working," Yusufov said of Russian firms.

Nikolai Tokarev, the head of Russian state oil firm Zarubezhneft, which has
big interests in Iraq, told Reuters this week he saw no prospects for
Russian firms in post-war Iraq as the United States would squeeze its
rivals out of the region.

He also said he was sceptical about the prospects of using international
law to keep existing deals under a government that might replace Iraqi
President Saddam Hussein's.

U.S. oil services firms, including a subsidiary of Halliburton Inc <HAL.N>,
formerly headed by Vice President Dick Cheney, this week was awarded U.S.
government contracts to assess and extinguish oil well fires in Iraq and
supply well control services.

Halliburton, the world's second largest oilfield services firm, has a long
history of involvement in military logistical support for the U.S. government.

But the biggest deals will be for the development of several giant fields
that make Iraqi oil reserves second only in size to to Saudi Arabia's.


Russian firms have signed contracts worth $4 billion with Saddam's
government to drill oil wells, deliver equipment and develop Iraq's massive
oil reserves.

The key deal is a $3.7 billion contract held for years by Russian oil giant
LUKOIL <LKOH.RTS>, smaller Zarubezhneft and Mashinnoimport to develop a
huge West Qurna field.

Iraq scrapped the contract last year saying LUKOIL was seeking U.S.
guarantees to keep the field under any government change. Baghdad said it
was likely to leave the contract in Russian hands, with Zarubezhneft as a
possible operator.

In January, Baghdad awarded a contract to Russia's oil and gas construction
company Stroitransgaz to develop block four in Iraq's Western Desert.

It also initialled contracts with Soyuzneftegaz, a small company, for the
100,000-barrel-a-day Rafidain field in southern Iraq and with medium-sized
oil producer Tatneft <TNT.N> for block nine in the Western Desert.

It also started negotiations with Zarubezhneft on the giant Bin Umar field
-- news which came as a shock to French oil major TotalFinaElf <TOTF.PA>
which has long been earmarked for the $3.4 billion development.

Russian firms also have contracts worth tens of millions of dollars to
supply equipment to Iraq, including for power generation plants,
agriculture, and transportation.

Oil deals under the UN oil-for-food programme include Zarubezhneft's
contract to drill 45 wells and Tatneft's contracts to drill 33 wells on the
Kirkuk field. Mashinnoimport has a $75-million contract to drill 90 wells.


TV1 Review
Compiled by Luba Schwartzman (luba_sch@hotmail.com)
Research Analyst, Center for Defense Information, Moscow office

Wednesday, March 26, 2003
- Russian polar scientists will carry on the tradition of their
legendary predecessors. In about a month, the North Pole-32
drifting station will be opened. Once the right ice floe is chosen, 12
scientists will spend a year performing experiments.
Iraqi Ambassador to Russia Abbas Khalaf has asked Russia to
recall the humanitarian aid from the Iran-Iraq border, explaining that
refugees are beginning to return home. In response, Russian
Emergencies Minister Sergei Shoigu noted that his ministry does not
participate in any political events, but merely provides help to the
people, regardless of their nationality, faith and political convictions.
Chairman of the International Committee for Pediatric Disasters and
Wars Medicine Leonid Roshal recommended the creation of a "green
corridor" to evacuate children from Iraq to neighboring countries.
- A helicopter fell into the sea during training exercises of the Pacific
Fleet. The four crew members who were onboard are still missing.
- The Strategic Missile Forces carried out training exercises in the
Ivanov Oblast. The main event of the exercises was the testing of
the Topol missiles.
- Russian President Vladimir Putin met with representatives of the
United Russia Party. He noted that, in the few years the party has
existed, it has accumulated significant experience of social-political
work. Putin emphasized the importance of United Russia's position
on salaries to state employees.
- President Putin also met with Prime Minister Mikhail Kasyanov to
discuss socioeconomic issues, including economic growth, incomes
and investment.
- Russian Foreign Minister Igor Ivanov told Russian Federation
Council members that Russia will demand an end to the war in Iraq
at today's meeting of the United Nations Security Council. He
asserted that the US and Great Britain made a great political mistake
when they began the war against Iraq without proper legal grounds.
The senators asked Ivanov whether the actions of the US and Great
Britain should be brought before the International Tribunal in the
Haage. The minister responded that he could not give an exact


Date: Wed, 26 Mar 2003
Subject: Verlin on Russia and Iraq
From: Nikolas Gvosdev <gvosdev@nationalinterest.org>


A Most Dangerous Game: Russian Gambles, American Distractions 
By Yevgeny Verlin 
Yevgeny Verlin is the assistant international editor for Nezavisimaya
Gazeta (http://www.ng.ru).

The U.S. State Department has addressed a protest to Moscow in connection
with the alleged discovery that Iraq has received supplies of weapons
technology in contravention of UN sanctions.  Washington maintains that it
has made representations about this through diplomatic channels over the
course of the last several months.  Now, it has finally been decided to
give these accusations a public character, through the established system
of "leaks" to the press. 

In Moscow, of course, the accusations concerning the sale of weapons to
Iraq were categorically denied.  Some experts have not discounted this
possibility in principle.  For example, the retired commander of the Air
Force, General Anatoly Kornukov, in an interview with the Interfax news
agency, did not rule out the possibility that a supply of Russian
radio-electronic jamming units could have found its way to Iraq through a
third-party country despite a government ban. 

That clouds have begun to form on the horizon of the Russian-American
relationship became very clear this past Saturday, when the Russian Foreign
Minister Igor Ivanov, speaking at the Council for Foreign and Defense
Policy  (CDFP) [editor's note: a prestigious organization akin to the
Council on Foreign Relations in the United States], immediately took the
opportunity to square account by declaring, "We have done nothing illegal
in connection with this country [Iraq]."  But then he slipped up, saying,
"it is possible that private companies have done this, but this would be
the exception."  Interestingly, this little tidbit was not included in the
official text that was reproduced the following day on the Foreign
Ministry's website. 

It is difficult to say how sure (or not) Moscow is that Russian companies
did not deliver completed weapons systems to Iraq.  The country can be
compared to a bordello where it is possible to work up deals like this, as
it suits people--in principle, anything goes.  "There are many businessmen
who would like to warm their hands by selling weapons.  Before, there were
facts about illegal attempts to allegedly transfer military hardware to
governments in Africa and Asia.  But now, in conjunction with the FSB (the
Federal Security Service), we have decisively cut down on this," observed

However, now there has been a ferocious outcry from Washington.  The
Russian president has decided to deliver a blow, guaranteeing to punish any
violators of the UN sanctions regime.  If, of course, any can be
apprehended.   It didn't bother Putin to speak with President Bush on
Tuesday; however, Kremlin sources indicated that Bush struck a "very
adversarial note."

Observers in Moscow are united in their belief that the primary reason for
the current spat between Russia and the United States is a product of the
dissatisfaction of the White House with its relations with Moscow,
strengthened by the first military setbacks faced by the coalition in
Iraq.  The final straw was its stubborn resistance to the realization of
American plans for war with Iraq.  It was not enough that earlier we
opposed war; we have decided to continue this into the future.  In
particular, Moscow has already promised that it will veto any attempt to
legitimize American military action and any of its results in the United

In answer to my question, as to how and in what manner this will be carried
out, Foreign Minister Ivanov said:  "Russia will be very carefully paying
attention to all subsequent resolutions of the UN Security Council
concerning Iraq, and will stand against any attempt to directly or tacitly
legitimize any military operation or any subsequent steps, which will
strengthen a reconstruction of Iraq 'American-style.'" 

In Ivanov's words, Moscow would seek under those circumstances to add a
"legitimization" of Russia's economic interests in Iraq into any subsequent
resolutions of the UN Security Council.  This means in concrete terms that
in the event of "regime change", all contracts concluded under Saddam
Hussein would remain in force, as well as a recognition of Iraq's $8
billion debt to Russia. 

And so, Russia refuses to give America the right to legitimize its goals
and interests in Iraq.  However, in the event of a change--for instance,
the establishment of a pro-American regime in Baghdad--it may be possible
to add, through the UN, some guarantees for the consideration of Russian

It is difficult to say how all of this can be coordinated with
international law.  Yet, if a regime is established in Iraq that Russia
deems "illegitimate", and moreover, if Russia does everything possible to
prevent this from taking place, how is it possible under these conditions
to suddenly add such guarantees for itself?  Who, concretely, would 
safeguard these guarantees? The UN?  It does not appear that Washington
will turn over supreme authority for the reconstruction of Iraq to the UN. 

On the diplomatic front it is already clear that new, heavy battles will be
aroused in the Security Council.  It is doubtful whether Moscow's similar
approach (as before) would be able to produce mutual understanding between
Russia and the United States. 

Washington is irritated by Moscow's confidence that "the Americans will
eventually have to come back to the UN", a confidence bolstered by the
assumption that there will be no quick "blitzkrieg" in Iraq.  The Russians
believe that this first attempt to unilaterally restructure the world
"American style", without the mandate and participation of the UN, will fail.

Russia has a different understanding than America as to the goals that led
to the creation of the anti-terrorist coalition.  For the Americans, it was
simply an "episode", a fortuitous and timely chance to establish a unipolar
world under American hegemony.  Moscow, for its part, does not view this
coalition, in the formulation disseminated by the Foreign Ministry, as "a
prototype of a new system of global security, which permits a joint
approach to such issues, as the spread of the weapons of mass destruction,
organized crime, drug trafficking, regional conflicts, and to solve a whole
host of other complex problems."  This difference opens up a path for the
two powers to be further divided, not only on the basis of values, but
concrete interests as well. Washington wants this coalition to function as
a disciplined "bloc", not a compote distilled from the complementary and
non-complementary interests of the various players. 

Speaking to the CFDP, Ivanov noted: "How this crisis is regulated
determines the principles that will establish security and the global order
for the coming years and decades."  In general, this is a very streamlined
phrase.  But it can imply an even narrower scenario for the way the
situation will develop, more than just a simple trade (of the type: you
respect my interests, I'll take yours into account).  Moscow has come to
the conclusion, however, that Washington is not prepared or now is not even
able to guarantee Russian interests in Iraq (the contracts, repayment of
the debt, and so on).

In the opinion of one of the experts of the CFDP, Moscow is expecting that
the United States, having won the war, will lose the peace--and that the
primary threat to Russia is not the United States itself, but "ineffective
leadership" on the part of America.  No one wants to see America
defeated--it is the current governing elite of the United States--the Bush
team--that they want to see lose, an attitude that prevails especially in
the Russian media.  (For example, a recent headline in the Russian business
newspaper Ekspert read: "Bush's Cowboy Team Has Been Shown to be a Gang of

It is important to point out, however, that this attitude is not decisively
supported at the highest levels in the Kremlin.  Putin cannot demonstrate
any similar sentiments that currently are burning up the airwaves of the
Russian media--that even if Russia cannot engage in a frontal confrontation
with America, active opposition on a broad political front is desirable. 
Partisans of this approach want to harass the Americans--say by holding up
ratification of the strategic arms accord (as this article went to press,
the Russian Foreign Minister was announcing that there would be an
indefinite postponement for ratification), or provoke other "blisters"
while America is tied down in Iraq.  They aren't worried that this would be
a recipe for the American hawks to call for the same with regards to
relations with Russia. 

No, the Kremlin has chosen a different tactic, a softer line, constantly
repeating, "We are now partners with the Americans, near-allies and
friends, but their mistakes do not disturb us; we advised them not to
attack Iraq and become bogged down as happened to us in Chechnya; we think
they should concentrate on respecting more the interests of their partners
in the anti-terrorist coalition, and so on.  In general, we think it would
be wiser for the White House to be a little less 'one-sided'," and so on. 

And this is Moscow's principled stand, from which no deviation is
possible.  Nor is it useful to provoke a confrontation with the most
influential wing--the hawks--of the Bush Administration (even though Ivanov
calls them "our opponents"), which risks provoking an even deeper split
within the international community. 

So Moscow is navigating between the Scylla and Charibdis a bit easier.  In
this regard, Europe has become a key part of any "multipolar" world. 
Ivanov stresses that multipolarity is not some of combination animated by a
spirit of anti-Americanism, and in this regard is satisfied by the closer
coordination with France, Germany and China in the UN Security Council,
building "not on the principle of 'bloc discipline' but on the basis of
complementary approaches to solving concrete problems."  

But this is the question, if we go down some sort of variant of this type
of relationship with the United States--which players in such a multipolar
world will be for Russia?  Does Russia possess the economic and other forms
of leverage needed to buy their loyalty (as it does with its clients in the
CIS)?  And do we think that when we buy them, their loyalty will be firm,
and others will not outbid us?  Can Russia really support a new arms race,
without running the risk that this will degenerate into another Cold War? 

The answer to all these questions is of course in the negative, decisively
so.  Certainly, you find among some extremists, particularly in the ranks
of the former generals, a whiff of even a stronger variant; to bang down on
the table the nuclear card, retarget the missiles, turn back the clock,
mobilize, hide away, resurrect (even if only virtually) superpower status.  

Yet, this frightens the Americans.  They are engaged in Iraq, but not
prepared to take heavy losses.  The Moscow hawks maintain that it would be
even more difficult, psychologically, for the Americans to cope with having
Russia (and perhaps, acting in concert with China), as a strategic
opponent, thus having to face the possibility of having to fight on two

This is why I do believe that Moscow has found a real source of leverage
(and pressure) against Washington.  Moscow's confidence in its ability to
influence the dialogue between Russia and the United States is grounded in
the fact that, with the destabilization of the Middle East, Venezuela and,
in the last few days, Nigeria (as well as Russia's geopolitical overtures
to Kazakhstan and Azerbaijan), Russia's importance for America's energy
strategy increases.  The Kremlin thus believes that it is in the strategic
interest of the Bush Administration to secure a tighter partner ship with
Russia, especially if the United States faces changes in the global balance
of power due to a rising China.  And this leverage, this influence, will
only more powerful as the U.S. war machine becomes bogged down in Iraq, as
the gulf widens between America and Europe, as hostility grows between the
West and the Islamic world, and as the antiwar movement strengthens
throughout the world. 

As I wrote two weeks ago: "For today Russia finds herself in distinguished
company-- with the leading continental powers of Europe--France and
Germany.  And even though it is not as visible, we are also very close to
our "strategic partner," China.  It also does not need to be said that
other players are on the same side of the barricade with Russia --the
majority of Arab and Islamic countries, as well as an influential antiwar
front which is forming in the political and social circles within the
majority of Western countries.  So therefore the goal of Russian tactics
is to minimize the negative fallout of any American action while
maximizing Russia's benefits."

Yet, there is a real risk that, if in pursuing this strategy, the Russian
hawks gain ascendancy within the Kremlin, we could end up sliding into a
new Cold War.


March 27, 2003
Who sold American weapons to Saddam Hussein
If Iraq really had our systems, American casualties would be much higher
Author: Ivan Yegorov
[from WPS Monitoring Agency, www.wps.ru/e_index.html]

America is still accusing Russia of unlawfully exporting military
equipment to Iraq. US Ambassador Alexander Vershbow promised economic
sanctions against the sellers. However, we have obtained a copy of a
classified report from the US State Department which makes it clear
that any sanctions should actually be applied to American companies:
they sold special equipment and weapons to nations included in Bush's
"axis of evil". It is this equipment that enables Iraq to deflect
bombs and missiles from military targets.
"We believe that Russian military equipment (technology) was
transferred to Iraq either directly or via other countries. There can
be no doubts at all that this equipment is in Iraq now," US Ambassador
Alexander Vershbow said yesterday. The diplomat hopes that some
"punitive measures" will be taken against the Russian companies
concerned, since "arms exports to Iraq are banned by the international
sanctions regime." The US State Department sent an official protest
note to Moscow several days ago, accusing Russia of having sold Iraq
antitank systems, night-vision goggles, and GPS jammers.
Arkady Shipunov of the Tula Design Bureau (one of the arms
producers mentioned by Washington as a culprit) was adamant: "We have
not signed any contracts or conducted any negotiations for the sale of
Kornet systems or any other weapons systems with Iraq or any other
countries subject to international sanctions."
Shipunov says this is not the first time Tula has been accused
and threatened by Washington. "All this is a fiction invented for the
purpose of making it more difficult for us to export our military
hardware, which is objectively superior to its American-made
equivalents," he said. Shipunov agreed that Kornet systems are
particularly effective against armored and motorized units. Shipunov
said, "Had Iraq possessed our systems, the US Armed Forces would have
been reporting much heavier casualties now."
According to our sources, weapons were indeed delivered to Iraq -
but by American companies, not Russian ones.
In early February 2003, the US State Department prepared a report
for the US Congress titled FY 2002 End Use Monitoring Of Defense
Articles And Defense Services Commercial Exporters. The document dealt
with monitoring the end use of American weapons by buyers in 2002;
namely, the weapons sold by private defense sector companies on the
basis of export licenses issued by the US State Department. According
to the report, there were 428 inspections of how arms importers were
using the hardware bought from America. Fifty violations were
The report states: "Due to customers' deliberate or unintentional
failure to comply with American requirements for the end use of
exported military hardware, it is impossible to rule out the
possibility that it may reach countries to which deliveries of
American weapons and military hardware are banned."
Of the total 50 violations, nineteen incidents involve deliveries
of light weapons and ammunition, twelve involve communications and
electronics, nine involve deliveries of spare parts for aircraft, and
ten involve deliveries of armored vehicle spare parts, artillery
rounds and bombs, or night-vision goggles. (It may be added here that
this covers the kind of equipment the Americans claim Russian
companies have sold to Iraq.) European countries were involved in 17
incidents, Mideast countries (including Iraq) were involved in 13
incidents. Ten incidents involved countries of the Asia-Pacific
region, and ten more involved Latin America. Experts say that
consignments of American weapons to Iraq might have mostly included
light weapons (M-16 assault rifles) and ammunition, aviation weapons,
communications systems, and TOW antitank missile systems.
According to what information is available at this point, 24
major American companies (including Rockwell, Bechtel, Sparry,
Honeywell, Hewlett Packard, Tetronix, International Computer System,
TI Coating) sold their equipment and goods to Iraq despite the
embargo. Iraqi leaders used all this to advance their defense
Official Washington has not yet promised any sanctions against
American companies dealing with countries included in the "axis of
(Translated by A. Ignatkin)


Wall Street Journal
March 27, 2003
The Russian Strain
Mr. Goldberg is a writer specializing in bioterrorism and medical innovation.

Russia's foreign minister, Igor Ivanov, was decidely testy yesterday,
saying that his country's firms have not violated sanctions on Iraq. "There
is no evidence confirming violations by Russian firms of existing
sanctions," he stated, before aiming sharp words at the U.S. He has reason
to be so defensive. Russia's involvement in the arming of Iraq goes beyond
supplying radar-jamming systems and the personnel to maintain them. Moscow
has supported Iraq's development of weapons of mass destruction and
connived with Baghdad in hiding its role as a main supplier of the
materials and know-how to weaponize anthrax, botulism and smallpox.

Russian support for Iraq is not new. Gary Milhollin and Kelly Motz's July
2001 article in Commentary notes that inspectors found a 300-page file
detailing a 1995 deal for Russian aircraft. The agreement not only included
military craft that the embargo banned, but engines and guidance systems
for remote-controlled drones, which could deliver gas or germ-warfare agents.

In 1999 Russia agreed to sell Saddam Hussein $100 million worth of military
hardware. The deal involved Ahmed Murtada Ahmed Khalil, the transport and
communications minister, who ran the biological weapons program at the
Salman Pak facility outside Baghdad, and who knew exactly what Iraq would
need in order to rebuild its WMD program after the Gulf War. Under his
tenure, Russian involvement in the development of Iraq's WMD program has
increased. Iraq's Scud-C or al-Hussein missiles were acquired from
high-level military officials and Russian arms dealers. The al-Hussein was
retrofitted to deliver chemical and biological weapons with Russian
technology. In 1998, the U.N. Special Commission was prevented from
verifying Iraqi claims that it had destroyed the al-Hussein warheads. At
that time, Russia joined with France and Germany in taking up Iraq's
campaign to weaken the inspection authority and opposed the Clinton
administration's decision to bomb Iraq back into compliance. To this day,
inspectors believe that Iraq retains a stock of chemical munitions,
including chemical/biological al-Hussein ballistic missile warheads, 2,000
aerial bombs, 15,000-25,000 rockets, and 15,000 artillery shells. Iraq may
also retain bio-weapon sprayers for its Mirage F-1s.

Russia appears to be helping Iraq build a better biological and chemical
weapons program. Richard Spertzel, the former head of Unscom's biological
weapons inspectors, points to negotiations in 1995 between Russia and Iraq
for the supply of fermentation equipment, including a 5,000-liter
fermentation vessel. He notes that the vessel that Moscow agreed to sell
Iraq for use in making single-cell animal protein was 10 times larger than
the largest vessel Iraq has admitted using to brew germs. Documents he
uncovered call for an agreement between leaders of Iraq's weapons programs
and Russian experts for the "design, construction and operation of the
plant." The agreement -- which Russia maintains was for the purchase of
equipment to manufacture animal feed -- includes the names of the director
of Iraq's botulinum toxin program, the chief engineer for the Al Hakam
chemical weapons plant, and prominent members of Iraq's military industrial
commission. Iraq publicly admitted producing anthrax and botulinum toxin at
Al Hakam. Though Russia flatly denied involvement, it refused to allow Mr.
Spertzel to interview Russians to determine whether the equipment was
actually delivered. Though inspectors decommissioned Al Hakam in 1996, Mr.
Spertzel believes that the Russian equipment was delivered and stored

Key Unscom scientists were Russians who had been deeply involved in the
Soviet bioweapons program. Tariq Aziz worked with Premier Yevgeny Primakov
to pack inspection teams with Russians picked by Moscow. The manipulation
paid off. Mr. Spertzel recalls the Russians were "constantly giving the
Iraqis the benefit of doubt. They said, 'no way could Al Hakam be a
dual-use facility.'" Yet Mr. Spertzel is "100% convinced that Iraq has
weaponized smallpox," and that the Russians on the inspection team were
"paranoid" about his efforts to uncover smallpox production. They had
reason to be, since it is likely that Russia supplied the original virus.
The CIA determined that in the 1990s, a Russian scientist, Nelja N.
Maltseva, had brought the strain -- named the Aralsk strain after a 1971
smallpox outbreak in the town of Aralsk, at the northern end of the Aral
Sea -- to Iraq. The Soviets hushed up the 1971 outbreak; and their
successors in Moscow now deny that Maltseva handed any virus over to the

In 2002, Alan Zelicofff, an adviser to inspection teams and a senior
scientist at Sandia National Laboratories who has run a hepatitis C
monitoring program with Russian epidemiology units, uncovered a Soviet-era
secret report about the Aralsk outbreak. When forced to admit its
occurrence, Dr. Zelicoff's Russian counterparts claimed it was a natural
outbreak triggered by the "garden variety" smallpox virus. But after
interviews with victims and an analysis of the outbreak's timing and
trajectory, Dr. Zelicoff determined that it was caused by "a new and lethal
strain of smallpox that traveled at least 20 miles from a secret biological
weapons testing site on an island in the Aral Sea to infect people downwind
on a ship." Of the six adults who were exposed to the strain, five
contracted smallpox despite being immunized. Dr. Zelicoff and others
believe that the strain is more communicable, and might be
vaccine-resistant. He asked colleagues in Russia to help him locate the
strain last summer and to determine if the current smallpox vaccine can
protect people from infection. They replied curtly that no such strain
existed, a stance they maintain to this day.

Other countries have -- through carelessness or complicity -- provided Iraq
with the materials and equipment needed to build up its biological and
chemical weapons program. But none have done more to rebuild Saddam's
arsenal, and none have been more aggressive in helping hide the truth, than
Russia . If these weapons are deployed against our troops, or wind up in
terrorist hands, Vladimir Putin might find that he never gets asked to the
Bush ranch again.


Moscow Tribune
March 28, 2003
Dragging feet at the UN
By Stanislav Menshikov

In view of the intensity of diplomatic activities by Russia, France and
Germany preceding the war in Iraq one would have assumed them to become even
more energetic once the war started. However, last week's emergency session
of the UN Security Council proved to be a colourless spectacle. No attempt
was made to table a resolution declaring the war illegitimate. The
resolution, no doubt, would have been vetoed but its very fact would have
made a strong impression on world public opinion.

The Russian parliament did pass a resolution recommending Vladimir Putin to
call for a special session of the UN General Assembly. The majority of UN
members are on record in opposition to the war, and there is little doubt
as to the session's outcome. However, Putin made no hurry in following that
recommendation. Now that a new Security Council session has been called on
the initiative of the Arab League, the General Assembly session could yet

France, Germany and Belgium announced the creation of a new joint body to
which they invited others. But deep silence followed their announcement. It
looks like the pro-peace diplomatic bloc, including Russia, was biding time
waiting to see how events in Iraq turned out. In case of quick Saddam
capitulation, they would jump back on the UN boat to secure seats at the
post-war "reconstruction" feast. If the war stretched out, they could resume
talking about "bringing the crisis back onto diplomatic lines". Such
pragmatic opportunism should have been expected but is always unpleasant to

Now that the Iraqi army has put up hard resistance, it is time for a more
objective assessment of the situation. At least two things have become
clear. First, the Saddam regime is stronger than was thought and the Iraqi
population is not as eager for US style democracy as George W. Bush claimed.
There is practically no domestic opposition willing to join thefighting, as
was the case in Afghanistan.

Second, the US military have yet to provide evidence of Iraqi WMD that they
claimed they would find soon. Even if they turn up some stuff they would
have to convince the world public opinion that they did not place it there

Apart from international law and the UN, the main casualty insofar as Russia
is concerned is the worsening of relations between Moscow and Washington. US
protests against alleged sales of Russian armaments to Iraq, whether true or
not, are one example. Russia's protest against U-2 spy planes flying
dangerously close to Russia's southern borders is another one. Moscow's
decision to delay ratification of the Offensive Potential Reduction Treaty
is yet another instance of the same.

But more important is the drastic change in Russian public attitude towards
the US. So far reluctantly considered a doubtful ally in the war against
terrorism, it is now seen as a very dangerous partner that is already
endangering Russian geopolitical interests and could present a potential
threat to its national security. This is certainly not a unanimous view, but
one shared by a vast majority in the high political establishment.

Consider the unpublicised part of the Duma resolution, which says that the
war in Iraq "has created a situation that potentially threatens national
security of the Russian Federation". The Duma suggests increasing defence
expenditure to 3.5 percent of GDP (or by 35 percent), starting this year, in
order to "speed up modernisation of Russian armed forces". It could be that
the full amount of additional finance for defence will not be immediately
found, but the intention is clear. It coincides with former statements by
Putin to the same effect.

There are two reasons for this assessment. First, US action in Iraq is seen
as the first in a series of wars that America is planning against so called
"rogue states" Iran, North Korea, Syria being next in line and others to
follow. Because these countries are all situated along Russia's southern
perimeter and enjoy good relations with Moscow, US wars against them would
create continuous political crises in US-Russia relations leading eventually
to the resumption of the Cold War. While Moscow is relatively safe behind
its current nuclear potential, it will need to spend more resources in
building a more credible shield for the 21st century.

Second, the US has set a precedent for waging pre-emptive wars against
sovereign nations and created an international order that Putin rightly
called "the rule of the fist". In such a world, the only guarantee of
sovereignty is possession of nuclear weapons. Their wholesale proliferation
is just a matter of time. Also the right to start pre-emptive wars might be
claimed by any nation, not only the US. It is a world in which no country is
safe from aggression.

Some believe Russia's only way to survive in such a world is to be a US ally
and accept its domination. But Russia has a sad history of siding with
superpowers set on creating global empires. Allying with Napoleon and Hitler
eventually led to military confrontation. Beware dangerous partners.


No. 12
March 2003
Alexander Zinoviev: The Iraqi events are just an episode in the war
for global leadership which the United States has been waging for
Author: Vladimir Rudakov
[from WPS Monitoring Agency, www.wps.ru/e_index.html]
An interview with sociologist Alexander Zinoviev

Alexander Zinoviev: World War III has been underway for a long
time now. It is in its "hot" phase now. In my view, the turn of other
countries will come after Iraq. I believe that Asian communism will be
next - North Korea, China, and others. The West led by the United
States will star in this drama. This is a war of conquest, waged to
take over the world regardless of the cost.
Question: What do you mean by World War III?
Alexander Zinoviev: This is a process that may be dissected into
several phases. Phase One is over. That was the notorious Cold War. It
was a war on the Soviet Union and its satellites. The West won the war
and the Soviet Union disintegrated along with the socialist camp.
The "hot" phase followed. The bombing of Serbia was the first
open operation. On the other hand, there was no clear and effective
ideology then, something to justify the aggression and serve as its
driving force.
September 11 changed everything. International terrorism stemming
from the Muslim world was called public enemy number one. Speculations
began on the "war of civilizations" allegedly declared by the Muslim
world. The falsehood of the ideology was apparent (most Muslims
condemned terrorism and did not want wars against Christianity), but
it became instantly popular in the United States and other countries.
The world was told that "the international community" had given George
W. Bush carte blanche for "shooting wars" throughout the world.
Question: The latest events around Iraq make is clear that the
West is anything but monolithic...
Alexander Zinoviev: In my view, the discord among allies over
Iraq is quite shallow and external. It is not to be taken seriously or
relied on.
Question: And what is Russia's place in all these plans?
Alexander Zinoviev: It is not to be envied. Attempts will be made
to use it as an anti-communist bridgehead against China. A Western
political scientist, a specialist on the Soviet Union, told me several
years ago that "The war on China will cost the United States 30-50
million Russians." It is common knowledge, after all, that the
Americans always try to use others to promote their objectives in
order to minimize their own casualties. They will surely try to use
Russia as a source of manpower in the war on China.


March 27, 2003
Foreign Investors Forget about Russia
Western experts believe that Russia is still retarded

The issue of the lack of foreign investments in the Russian economy has
been recently debated at all levels of power in the country. President
Vladimir Putin recommended the government to work on the extenuation of the
investment climate in Russia. On a visit to Germany, Russian Prime Minister
Mikhail Kasyanov called upon Germany businessmen to build factories in
Russia. The Russian government addressed to French companies with the same
request and even offered them to edit the draft of the new customs code,
in order to make it more convenient. However, international research
centers chose the best moment to say that foreign investments are not
coming into the Russian economy.

SRU and Expert Information Group research centers conducted a special
research, which was devoted to Russias appeal for Western investors. They
came to conclusion, which looked like a paradox from the book Alice in
Wonderland: Western businessmen forgot about Russia.

According to researchers, Russia took a lot of efforts to convince English
and American businessmen of the fact that the country was absolutely ready
for the inflow of foreign investments. Yet, the poll, which was conducted
by consulting firms, proved that Russia was still somewhere beyond that.
Forty businessmen, managers and journalists took part in the poll. No one
of them mentioned that Russia was on the list of countries, where they were
supposed to run their businesses in. On the contrary, they said that they
were not going to deal with Russia at all. SRU executive director said that
Russia turned out to be no mans zone.

To be honest, that was rather a strange and not very unbiased conclusion to
make, taking into consideration the fact that there is serious discrepancy
between Russia and the USA regarding the war in Iraq. However, this opinion
gets more and more predominant in the Western business world.

The Financial Times has recently published an article, which was devoted to
foreign businessmens intentions in the Russian economy. As it was said in
the article, the intention of such a huge transnational corporation as
British Petroleum to Acquire 50% of the new joint venture TNK-BP did not at
all mean that other large companies would follow BPs example. In other
words, it is an exception, which confirms the rule even more.

According to the report of the mentioned consulting firm, an oil
manufacturer is supposed to be in the place, where that oil is available.
However, Russia is not the only country, where people extract oil. There is
a lot of oil in other places of the planet. The participants of the poll
said that they had a choice about a place, where they could extract oil.
Russia was mentioned on the bottom of that list.

Russia looks rather colorless when it comes to the investment climate. The
situation is absolutely different with China, though. China has the
strategy of economic liberalism that is secured with political
authoritarian regime. Russia has done the opposite thing. President Putin
is very popular in the West. However, foreign investors are not sure that
Putin's reforms have been implemented completely. Foreign experts say it
sometimes that Russia stepped on this way of its development with the help
of Western advisors, who worked a lot with Boris Yeltsin. Well, foreign
advisors could not advise anything else. It was the USSR, not China, that
was in the opposition to the USA for several decades in a row. Here is the
result of the opposition.

Researchers determined two other aspects, which hindered Russia from
becoming a good place for foreign investments. First of all, Western
businessmen believe that Russia is still a deeply corrupted country. In
other words, all levels of the Russian society do not have any respect for
the power of the law, while the leading role for the economic and political
lives of Russia is played by so-called criminal elements. The authors of
the report think that such a state of things cut any investments
opportunities off.

Second of all, no social changes occurred in Russia over the entire 20th
century. Foreign researchers think that Russia is still a retarded country
when it comes to the living standard of the Russian people. This needs some
explanation, though. Foreign economists do not talk about an opportunity of
another October Revolution to happen in Russia. They talk about the fact
that there is no such notion as middle class in Russia, no private property
cult, no property at all. They think that Russian people do not possess the
pride of an honest tax-payer, that they are not devoted to the idea of
democracy and free business. In other words, foreigners are sure that no
Russian person will live for the sake of paying back a loan and interest to
a bank on time. It just so happens, that Russia is not going to become a
good place for investments until it becomes similar to the living standard
of England or Germany, for instance.

This seems to be rather absurd. Russia will never manage to obtain the
living standard of Belgium or of the USA: the history and the mind-set are
absolutely different, so it is not possible. In addition to that, both
Saudi Arabia, and India and China are absolutely different countries as
well. However, the volume of foreign investments in those countries grows
every year. This means that motives are meant to conceal certain reasons.

Indeed, a respondent of SRU and Expert Information Group gave an absolutely
amazing reason, which was cited in the report. An anonymous foreign
businessman said that Russia used to be an influential country, especially
twenty years ago. However, as a man said, Russia does not raise daily
interest for the West nowadays. It seems that investors can not find
anything special about Russia that would make them be interested. Various
influential experts have been reproaching Russia of the low level of
qualification of management, low level of industrial discipline and many
other sins. This does not mean that Russians do not work well. Competitive
branches of the Russian economy show that Russians can do something really
good. They manage to stand the international competition without any loans,
almost without any support of the state. Although, the reason why is
different: Russian people do not work the same way as foreigners do.

Here is a good example to show it. The National Council for the Corporate
Management has been recently established in Russia. This council
acknowledged that only 53% of Russian managers know, what corporate
management was. Only seventeen percent of them read the Corporate Conduct
Code, which has been passed in the country recently. It should be also said
here that those companies, where those managers worked, were set up in a
Western manner.

Does it mean that all Russian managers are of low qualification? Of course,
it does not. This means that Russian managers think and work in another
way. Foreign methods of working are not good for them. It also means that
billions of dollars have been wasted during ten years of economic reforms.
Foreign experts failed to teach Russian managers to live and work in a
Western way.

That is why all those attempts to present Russia as a retarded country,
which it is absolutely not profitable for investments, are only a
consolation for the vanity of those, who won the Cold War. This is
especially good against the background of no success in Iraq.

Strategic organizations do not leave Russia out of their sight. On They
keep taking a lot of efforts to extend their presence in the country. The
European Bank for Reconstruction and Development announced that it was
going to increase its investments in the Russian economy. Furthermore, it
was said that the Bank was intended to bring investments up to the level of
three or five billion dollars a year. This was said by the Banks President
Jean Lemierre. Mr. Lemierre told Japanese reporters that the countries of
East Europe get integrated in the European Union. That is why, the active
investments policy of the Bank shifts to Russia. The Bank invested a
billion dollars in Russia in 2002, which was 50% as much as in 2001.

Needless to mention that the European Bank for Reconstruction and
Development is a very serious organization. If such organizations as the
IMF, the World Bank, the EBRD come to Russia to work there, this means that
the West is supposed to be there too, from the strategic point of view.
This also means that such places might imperil interests of the West. This
is the reason why scheduled crises and defaults occur.

It is not ruled out that the whole Western world is still afraid of a
possible rebirth of the superpower. However, will the international capital
be good for Russia? Its influence and presence in the country keeps growing

Dmitry Slobodanuk
Translated by Dmitry Sudakov


American Outlook Today
Hudson Institute
March 26, 2003
The Afghanization of Chechnya
by Peter Brownfeld
Peter Brownfeld is a writer and editor in Washington, D.C. He works at the
American Enterprise Institute.

Afghanistan threatened America because it was a lawless country where
terrorists could organize and train. For this reason America destroyed the
al-Qaeda-sponsoring Taliban. Because the lawless parts of the Philippines
and Georgia have given haven to terrorists, the U.S. military is training
the local forces and fighting those threats. A worse problem than Georgia
or the Philippines and a region ripe for Afghanization has been largely
ignored since the war on terror began. That region is Chechnya, which
offers one of the most serious international security threats. Over the
last nine years, and particularly in the last four, the Russian military
has brutalized the Chechen people, thus radicalizing that conflict and
creating an environment where international terrorism could thrive. What
had been a secular and democratic independence movement could now be
changing as extreme Islam and terrorism are becoming attractive to some
Chechens and al Qaedas leadership and operatives appear to be seeking a
greater involvement in that conflict.

In a twist of irony, Russias cooperation in the War on Terrorism has
caused Washington to ignore the growing terror threat in Chechnya. The
almost unbelievable level of suffering the Chechens have endured is
radicalizing them and making terrorism more likely. When one considers what
they have gone through, it is natural that desperation and extremism would
find fertile ground.

Chechnya has been at war with Russia twice, from 1994 to 1996 and from 1999
to the present. It is now a nation of warlords and anarchy. In the last
nine years, between 180,000 and 250,000 people have been killed.
Approximately 350,000 Chechens have been displaced by the fighting. These
numbers are from a population of just 1.1 million. Roughly half of the
population has been killed or displaced by the wars. As a means of
comparison, while about 16 percent (using the conservative estimate) of
Chechens have been killed, during the conflict in Kosovo 0.6 percent of
Kosovars were killed. According to the International Helsinki Foundation
for Human Rights, The numbers of disappeared Chechens in recent months
indicate a continuing assault against the Chechen people that borders on

Chechnya, which is the size of Connecticut and has the population of
Vermont, has approximately 80,000 Russian troops in it, troops that
regularly commit atrocities with no accountability. Almost every village
and town in Chechnya has repeatedly endured so-called mopping up
operations, during which Russian troops loot, beat, rape, extort, and
illegally execute and detain Chechen civilians. One more frightening
statistic: Russian authorities have designated approximately 73 percent of
Chechen territory environmentally contaminated.

If such a hellish environment continues, young Chechens will not reject
terrorism. Carrying their fight abroad and allying with a bin Laden will
seem acceptable. Despite the diaspora of 100,000 Chechens in Russia,
Chechens rarely carry the war outside their borders. The fear of more
attacks like the one at the Moscow theater last fall should cause concern
in the Kremlin. Of greater concern for the West is that Chechnya could
serve as a base and recruiting ground for al Qaeda or other terror networks.

Last week, Chechen foreign minister Ilyas Akhmadov, speaking at a New
Atlantic Initiative meeting in Washington, said that while events like the
hostage standoff in the Moscow theater are now rare, the tenor of the
conflict could make them more likely. Akhmadov is a part of the last
elected Chechen government, which came to power in 1997.

The Russian brutality will continue to evoke a sharp response from the
brutalized. Because Chechens have no right except to die, the path to
radicalization is open, Akhmadov said. Russian policies toward Chechnya
have been a factory for creating terrorism. Every year that passes it gets
worse. More terrorists are created. Akhmadov warned that young Chechens
have no other training but in war. This generation has grown up with family
members being killed and tortured and with much of their schooling done
with Kalashnikovs. In a foreign ministry document, Akhmadov wrote, Four
years of indiscriminate warfare, ethnic cleansing operations, and
international indifference to Russian atrocities has created an atmosphere
of hopelessness and desperation.

In this era of worldwide terrorist networks and alliances among disaffected
groups, such as Colombian rebels and the Irish Republican Army, it should
be clear how this bitter and terrorized people could align with terrorists.
The warning signs are already there. Recent incidents show that Chechnya
should be within the spectrum of Americas anti-terrorism efforts. In
December 1996 al Qaedas second in command, the Egyptian Ayman al-Zawahiri,
investigated transferring the terrorist networks headquarters to Chechnya.
In the fall of 1999, three of the September 11 attackers were intending to
fight the Russians in Chechnya before being told there were enough fighters
there. In November 2002, bin Laden himself invoked Chechnya. In a message
broadcast on al Jazeera, bin Laden said, As you look at your dead in
Moscow, also recall ours in Chechnya.

While Chechnya has attracted the interests of Muslim terrorists, radical
Islam, which had never before been popular in Chechnya, has likewise gained
a foothold there. Long beards are appearing on men, while some women are
wearing the Arab-style hijab, a head-to-toe black dress that leaves only
the eyes uncovered.

Pleading for international attention and action, Foreign Minister Akhmadov
wrote in a peace proposal published on March 18, Moscows policy of
collective terror against the Chechen people is turning some elements of
Chechen society toward irrational and undifferentiated vengeance. While the
government of Chechen president Aslan Maskhadov has and will continue to
condemn any terrorist acts, regardless of who may perpetrate them, a just
peace is ultimately the only way to prevent this deeply alarming trend
[emphasis in the original].

A Chechen ministry of foreign affairs document similarly drew a grave
picture of the potential for terrorism in that country. Russias policy of
collective terror and total lack of accountability is turning Chechnya into
a fertile ground for terrorism. The Moscow hostage taking clearly
demonstrates Chechnyas extreme desperation and fast-growing
radicalization. Undoubtedly, continuation of the war will turn at least a
part of Chechnyas armed resistance to irrational . . . violence of
vengeance independent of the political agenda, which neither President
Maskhadov nor anyone else would be able to control. Ending the war and
solving the conflict are surely the only way to prevent this.

This week Chechens voted on a constitution that would declare the republic
an inseparable part of Russia. The reported voter turnout of about 80
percent and the overwhelming support for the proposal would appear to offer
some hope for a political solution. However, this referendum was taken at
the point of a gun, with 80,000 Russian troops in the country. Human rights
activists have said they suspect large-scale fraud. Additionally, because
of the climate of intimidation and fear, they say a fair poll could not be
taken. Leading Russian human rights organizations, such as Memorial, have
also criticized the poll. One suspect detail is the fact that between
27,000 and 36,000 Russian servicemen stationed in Chechnya were among the

The likelihood of this referendum leading to a final settlement seems
small, because the elected Chechen leadership and the guerillas do not
support it. Chechnyas political leaders consider the relationship with
Russia to be poisoned because of the brutality of the two wars. The Chechen
guerillas have also rejected the Russian proposal and actively campaigned
against it. With the continuing tough resistance, the opposition of the
Chechen political leadership, and the poll being taken in a country
occupied by a brutal army, it is hard to see the ingredients for peace
through this referendum.

The Chechen government offered a different formula for peace. Akhmadov was
in Washington to promote the governments peace proposal, which recognizes
the security threat Chechnya poses to Russia, and the haven Chechnya could
be for terrorists. Because of these concerns, the proposal is for a
conditional independence with a period of several years of international
administration that would include both United Nations peacekeeping troops
and civilian administrators.

Chechnya is not an issue that can be ignored. Should the radicalization and
Islamization of that conflict continue, Western security interests will be
in danger.The irony of Washingtons hesitancy to criticize Moscow for its
record in Chechnya is that this policy has worsened the international
security climate. Past experience in Afghanistan should spur Washington to
address Chechnyas plight before it becomes a terrorist haven.
Opinions expressed do not necessarily reflect those of the Hudson Institute.


Moscow Times
March 27, 2003
Putin Should Join the Party
By Alexander Sokolowski
Alexander Sokolowski, an adjunct professor of comparative politics at
George Washington University, contributed this comment to The Moscow Times.

With the approach of parliamentary elections in December and presidential
elections in March of next year, the Kremlin's political advisors are no
doubt devising and pitching various electoral strategies to President
Vladimir Putin. While it is unlikely that any of Putin's advisors will
recommend it, they should advise him to join a political party and to join
one now.

To the tough-minded political strategists on Staraya Ploshchad, such a
proposal must appear naive and even reckless. It would unnecessarily tie
Putin's re-election prospects to that party's performance in December's
elections, they would argue. Further, by joining a single party --
presumably United Russia -- Putin's popularity ratings would certainly lose
some of their luster, because his party membership would alienate at least
some independent-minded voters. Finally, these analysts would point out
that joining a party would needlessly complicate Putin's ability to build
coalitions in the next State Duma and to attract broad-based organizational
support for his upcoming re-election campaign. Although these concerns are
valid on some level, they inadequately consider the broader and longer term
political challenges the Russian polity now faces.

Putin can put an end to the vicious circle that Russia's presidential-party
relations have been trapped in for the past decade. The Catch-22 has been
the following: Presidents have refused to join a party largely because
parties were underdeveloped, could not consolidate enough of the vote, and
had an uncertain future. And pro-governmental parties have remained
underdeveloped, could not consolidate enough of the vote and had an
uncertain future largely because Russian presidents would not join them. A
major reason that both Russia's Choice and later Our Home Is Russia were
essentially stillborn and short-lived parties was that they were burdened
with responsibility for the government's performance, but were deprived of
a clear connection to, and the unequivocal support of, the most powerful
actor in the political system -- Boris Yeltsin.

More recently, the latest "party of power," United Russia, has all but
begged for a closer association with Putin. And while Putin has clearly
shown less indifference to his party of power than Yeltsin vis-a-vis his,
Putin's public support has remained that of a sympathetic outsider. And so
United Russia awkwardly remains a "presidential party" without a president.

As Putin approaches his second and final term in office, his political
advisors should encourage him to consider his broader role in Russian
history -- his legacy. By joining and leading a democratic political party,
Putin would establish himself as the Russian leader who finally forged a
more reliable, direct and genuine institutional connection between state
and society, between political power and policy responsibility. By joining
and leading a democratic political party, Putin would finally bring an end
to Russia's tsarist and Soviet modes of executive authority that have so
often isolated state power from society and obscured accountability.

Putin's official party leadership would also have a transformative effect
on United Russia, and on the party system as a whole. Putin's personal
popularity and the prestige of his office would bring to United Russia the
key element that previous parties of power have lacked -- the ability to
attract an enthusiastic, broad grass-roots following. By providing United
Russia with a popular leader and an enthusiastic base, Putin could give
this top-down, "cadre" party a chance to develop into a more mass-based and
lasting right-of-center party. More broadly, when the most powerful figure
in the political system decides to engage directly in party politics, the
party system will become a more central and durable feature in the
political landscape.

A glance across the presidential summit table provides Putin with further
arguments for joining a political party. First, the Russian president would
notice that all of his counterparts in the G-8 are also members of
political parties. Then, at other summit meetings, Putin might take note
that neighboring presidents who have refused to join parties -- Belarus's
Alexander Lukashenko and Ukraine's Leonid Kuchma -- have unimpressive
records of economic and political reform. While a multitude of factors are
responsible for the differences in economic prosperity and governance
between East and West, it is also clear that countries with executive
branches with strong links to society and clear accountability ultimately
are governed more effectively and with greater stability than those without
such institutional channels. If Putin wants to set Russia on a path to look
more like Europe's wealthy and stable democracies and less like Russia's
struggling and increasingly isolated Slavic neighbors, then joining a
political party clearly is a step in the right direction.

Admittedly, one political strategist close to the Kremlin, Gleb Pavlovsky,
has recently suggested that Putin should consider joining United Russia --
but only after the party has proved itself in December's parliamentary
elections by becoming a majority party. But this insistence that the party
of power must prove itself before enjoying an unequivocal association with
the president was also Yeltsin's strategy in 1993 and 1995 -- a strategy
that by the late 1990s resulted in two failed parties and a politically
isolated president.

Instead, Putin's advisors should encourage him to join a party now. Putin
has amassed considerable political capital, with popularity ratings that
remain persistently and remarkably high. Now is the time to use that
political capital to ensure a cooperative Duma for Putin's second term and
to ensure the continuation of his reforms. If Putin chooses to lead United
Russia in the near future, the party will undoubtedly win December's
elections and likely earn a majority in the Duma. In contrast, simply
borrowing a page from the 1999 campaign playbook and scheduling several
pat-on-the-back photo-ops with United Russia's leaders may not be enough to
secure a working majority in the Duma this time around.

Putin's joining the party now would also demonstrate his political courage
and toughness. By agreeing to lead and transform United Russia even when he
did not have to, Putin would elevate his reputation as a bold yet
responsible and foresighted leader. In addition, Putin's decision to lead
would also throw United Russia's rivals off balance during the campaign, as
opposition parties will be less likely to make aggressive attacks on a
party led by a highly popular president.

Kremlin advisors should remind Putin that the risks of remaining above
party politics are also high. Recent public opinion polls show United
Russia's popularity is flagging. And if the history of previous parties of
power is any guide, a state-sponsored, top-down, ideologically nondescript
party led by bureaucrats is likely to face great difficulty in winning over
a majority of voters. If United Russia fares poorly in December, then Putin
could face a recalcitrant Duma and a slowdown in his reform plans starting
early next year.

By the time of the parliamentary elections, Russia will have lived a full
decade under the Yeltsin Constitution of 1993. This has been a sufficient
transition period when it could be argued that a president should refrain
from an openly partisan approach to politics. While Yeltsin will always be
remembered for the 1993 Constitution, Putin has the chance to be remembered
as the leader who rehabilitated political parties and put that Constitution
on a more solid societal foundation.