[Congressional Record Volume 140, Number 127 (Tuesday, September 13, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: September 13, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
   ST. PETERSBURG COMMISSION: CATALYZING BOTTOMS-UP REFORM IN RUSSIA

  Mr. WARNER. Mr. President, I want to invite the attention of my 
colleagues in Congress to a unique international partnership formed by 
the Center for Strategic and International Studies [CSIS], a 
distinguished policy research institution in Washington, DC. I refer to 
the International Action Commission for St. Petersburg, on which I 
serve, and which is successfully increasing investment and business 
growth and speeding the process of economic conversion in St. 
Petersburg city and region. Working under the joint leadership of Dr. 
Henry Kissinger and Mayor Anatoly Sobchak, the 71 commissioners, 
comprising leaders of business, government and universities from six 
nations, play an aggressive and direct role in bringing about an 
impressive number of positive changes in northwest Russia.
  Commission actions are developed and implemented through a framework 
for cooperation involving 11 joint Russian-Western working groups and a 
consortium of international universities. These working groups have 26 
concrete actions completed or underway in areas ranging from 
arbitration court development to defense industry conversion and energy 
conservation. Through these actions, and through the partnership that 
has created them, the commission has sparked joint venture development, 
growing private and public investment in the St. Petersburg region, job 
growth, business education, technical assistance, and the building of 
structures necessary for a functioning free market economy and stable 
economic growth. These significant and tangible results not only 
provide clear benefits to the St. Petersburg region, but they also 
serve as a model for economic conversion for other Russian cities and 
regions, and cement a healthy working relationship between American and 
Russian leaders.
  The intense activity taking place in St. Petersburg through this 
commission, the enthusiastic involvement of so many senior leaders, and 
the early successes already achieved in this effort, underscore the 
critical importance--to both Russia and the United States--of strong, 
bottoms-up change in this strategic region of Russia to accompany top-
down reform efforts led from Moscow.
  Under the leadership of its president, Ambassador David M. Abshire, 
CSIS's effort on this project merits our admiration and support. I ask 
unanimous consent to insert in the Congressional Record descriptive 
information about the commission's work.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

 [From the Center for Strategic and International Studies, Washington, 
                                  DC]

           International Action Commission for St. Petersburg


                             brief overview

       The International Action Commission for St. Petersburg has 
     moved aggressively to develop and advocate concrete actions 
     which are leading to near-term increases in foreign 
     investment and in Russian and Western business growth in St. 
     Petersburg and the Leningrad Oblast. The commission is co-
     chaired by Dr. Henry Kissinger and Mayor Anatoly Sobchak. The 
     71 commissioners are senior leaders of business, government 
     and universities, and are from St. Petersburg, President 
     Yeltsin's cabinet, the U.S., Finland, Sweden, France and the 
     U.K.
       The work of the commission is being accomplished by joint 
     Russian-Western working groups which develop promising 
     actions and assist the city, oblast, business community and 
     universities in the timely introduction of these actions. 
     Over 200 persons are involved in the current eight working 
     groups and in a consortium of 26 international and St. 
     Petersburg universities. These eight working groups have 30 
     actions completed or underway addressing the following areas 
     critical to economic growth and conversion:
       Public Education for Business Growth;
       Infrastructure Improvement;
       Modernization and Development of the Port;
       Energy Conservation and Management;
       Unstable Business Conditions;
       Defense Diversification;
       Banking and Investment; and
       Agribusiness Development.
       The full commission has met in plenary session on three 
     occasions beginning in October 1992 in St. Petersburg, at a 
     1993 meeting in Baltimore, Maryland and Washington, DC, and 
     returning to St. Petersburg for a June 1994 meeting.
       During the June, 1994 plenary session, the commission set a 
     priority on securing needed investment funding for 21 
     projects developed by the commission working groups over the 
     past year. The commission also agreed to form three new 
     Russian-Western working groups to act on:
       Small and Medium Sized Business Growth;
       Health Care Improvement; and
       Strengthening of Government Processes under New Local and 
     Regional Government.
       The three new working groups will meet in St. Petersburg in 
     September 1994, and will propose new actions to be developed, 
     acted upon as quickly as possible. The original eight working 
     groups will guide the funding and execution of developed 
     projects. The commissioners will meet to measure commission 
     progress at a fourth plenary session, scheduled for July, 
     1995.
       This commission is organized by CSIS with Mr. George W. 
     Handy as director and Mr. David A. Pepper as assistant 
     director. Funding is from corporate contributions and a U.S. 
     AID grant.

                                Cochairs

       Henry A. Kissinger and Anatoly Sobchak.


                           Commission Members

                       Europe & the United States

       Krister Ahlstrom, President and CEO, A. Ahlstrom 
     Corporation.
       Anders Aslund, Director, Stockholm Institute of East 
     European Economics.
       Percy Barnevik, President and CEO, ABB Asea Brown Boveri.
       Per Benemar, CEO, Petersburg Products International.
       Carl Bjornberg, President and CEO, Myllykoski Oy.
       Michael R. Bonsignore, Chairman and CEO, Honeywell Inc.
       Fred L. Cipriano, Senior Vice President, Booz-Allen & 
     Hamilton.
       Robert W. Cox, Chairman, Baker & McKenzie.
       Robert Davies, Executive Director, The Prince of Wales 
     Business Leaders Forum.
       Georg Ehrnrooth, President and CEO, Metra Corporation.
       Bruno Grob, President, Otis Elevator International.
       Jukka Harmala, President and CEO, Enso-Gutzeit Oy.
       Robert D. Hormats, Vice Chairman, Goldman Sachs 
     International.
       Jaakko Ihamoutila, Chairman and CEO, Neste Oy.
       Jaakko Iloniemi, Managing Director, EVA.
       James D. Jameson, Chairman, Glenair.
       Harry Johnston (D-FL), U.S. House of Representatives.
       L.J. Jouhki, President, Thomesto Trading Company Ltd.
       Seppo Kauppila, Consul General, St. Petersburg, Embassy of 
     Finland.
       Jarl Kohler, President, Finnish Forest Industries 
     Federation.
       Eugene Lawson, President, U.S.-Russia Business Council.
       Joseph I. Lieberman (D-CT), United States Senate.
       Harald B. Malmgren, President, Malmgren Group.
       Thomas E. Marsh, Regional President, R.J. Reynolds Tobacco 
     International.
       Dave McCurdy (D-OK), U.S. House of Representatives.
       Jean-Marie Merillon, Chairman, Credit Lyonnais Russia.
       Jan Meyers (R-KS), U.S. House of Representatives.
       Kalevi Numminen, President and CEO, Imatra Power.
       Jorma Ollila, President, Nokia Group.
       William H. Orton (D-UT), U.S. House of Representatives.
       Ambassador Henry Owen, Consultants International.
       Milan Panic, President, ICN Pharmaceuticals.
       John E. Pepper, President, The Procter & Gamble Company.
       Ogden R. Reid, Director, National Patent Development 
     Corporation.
       John J. Roberts, Vice Chairman, American International 
     Group.
       Blair A. Ruble, Director, Kennen Institute for Advanced 
     Russian Studies.
       Robert Rutford, President, University of Texas at Dallas.
       Ambassador John D. Scanlan, ICN Pharmaceuticals.
       William Donald Schaefer, Governor of Maryland.
       S. Frederick Starr, President, Aspen Institute.
       Matti Sundberg, CEO, Valmet Corporation.
       Peter Wallenberg, First Vice Chairman, Skandinaviska 
     Enskilda Banken.
       John Warner (R-VA), United States Senate.
       Thomas Wheelock, Chairman, Comspan.

                                 Russia

       Vladimir Alexandrov, General Director, Shipbuilding.
       Alexander Belyaev, Member, Federal Council.
       Alexander Belyakov, Governor, Leningrad Oblast, Member, 
     Federal Council.
       Yuri Bokov, General Director, Shipbuilding.
       Alexei Bolshakov, Chairman, Railway Project.
       Anatoly Chubais, Deputy Prime Minister, Chairman, Committee 
     for Privatization, Russian Federation.
       Boris Fedorov, Deputy, State Duma.
       Vladimir Gorodniy, Vice President and General Director, 
     Lenvest.
       Viktor Ivanov, General Director, Union Industrial & 
     Building Enterprises.
       Victor Khalansky, Chief Representative for St. Petersburg, 
     Central Bank of Russia.
       Igor Klioutchnikov, Chairman of the Board, St. Petersburg 
     Stock Exchange.
       Alexei Kudrin, First Deputy Chairman, of St. Petersburg 
     Government, Chairman, Committee on Economy and Finance.
       Vyacheslav Larin, General Director, LenTEK.
       Yuri Lvov, Chairman of the Board, St. Petersburg Bank.
       Liubov Ogneva, General Director, St. Petersburg Clothes 
     Manufactory.
       Vyacheslav Petrov, General Director, Arsenal Production 
     Association.
       Vladimir Putin, First Deputy Director, of St. Petersburg 
     Government, Chairman, Committee on External Relations.
       Alexander A. Sarkisov, President, Klimov Works.
       Peotr G. Semenenco, President, Klimov Plant.
       Vladimir Semenov, General Director, Industry and 
     Construction Bank.
       Dmitry V. Sergeyev, Deputy Minister of Transportation, 
     Russian Federation.
       Anatoly A. Turchak, President, Concern Leninets.
       Ludmilla Verbitskaya, Rector, St. Petersburg University.
       Vladimir Yakovlev, First Deputy Chairman, of St. Petersburg 
     Government, Chairman, City Development Committee.
       Eugene Yelin, President, Currency Stock Exchange.
       Valentin P. Zanin, Manager General, Signal.


                                overview

       The International Action Commission for St. Petersburg is 
     organized under the co-leadership of Dr. Henry Kissinger and 
     Mayor Anatoly Sobchak to support actions which will increase 
     investment and business growth and speed the process of 
     economic conversion in St. Petersburg city and region. The 71 
     commissioners, senior leaders of business, government and 
     universities from six nations, work through 11 joint Russian-
     Western working groups and a consortium of international 
     universities to undertake concrete actions having a near term 
     impact on this strategic city and region of Russia. Periodic 
     plenary sessions bring the commissioners together to assess 
     progress, eliminate obstacles and decide on new directions 
     for action.


                         third plenary session

       On June 10 and 11, 1994, the International Action 
     Commission for St. Petersburg met in St. Petersburg for its 
     Third Plenary Session. The highly successful session was 
     hosted by co-chairman, Mayor Anatoly Sobchak, and was 
     preceded on June 9 and 10 by a meeting of the commission's 
     international university consortium. The commissioners 
     assessed and agreed upon 33 concrete decisions contributing 
     to investment and business growth in St. Petersburg city and 
     region; highlights included:
       $1.6 million dollars in investments to support 12 actions 
     which have been developed by commission working groups and 
     proposed to the U.S. Agency for International Development for 
     funding.
       Continued progress on major investment projects in energy, 
     port, agribusiness and other infrastructure areas totaling 
     potentially several hundred million dollars.
       Commission agreement to form three new working groups in 
     the areas of small and medium-sized business growth, improved 
     health care and strengthened government processes (the later 
     with an emphasis on tax and investment incentives, creation 
     of an ombudsman office and law and order).
       Approval by commissioners of a schedule for the year ahead 
     with a meeting of commission and working group co-chairmen in 
     February 1995 and a fourth plenary session in July 1995.
       Agreement that the priority effort of the commission in the 
     year ahead would be to help secure needed investments and to 
     support their rapid application, in St. Petersburg city and 
     region.


       major accomplishments among 30 current commission actions

       Television program on Russian-Western cooperation broadcast 
     on June 11 to the 14 million viewers of the St. Petersburg 
     channel.
       Voice of America Radio broadcasts across Russia of 
     commission experience.
       Guidelines, sponsors and charters for International 
     Arbitration Court organized; registration expected in several 
     months.
       One stop shop agency to assist businesses and investors and 
     to speed city development organized.
       U.S. Russia-Exchange programs underway with full St. 
     Petersburg participation.
       Russian-American Enterprise Fund introduced to St. 
     Petersburg personally by fund chairman, Mr. G. Corrigan.
       International School and Medical Center open and operating 
     successfully.
       Leninets award of a U.S. government grant for defense 
     industry conversion of $1 to 5 million scheduled for July; 
     all commission defense enterprises are well positioned for 
     additional grants.
       University Consortium expanded to 26 international 
     universities with work underway on distance learning, new 
     courses, exchanges and creation of business schools.


           projects developed and ready for investment action

       The following 12 projects ready for funding have been 
     developed from working group actions and proposed to U.S. 
     AID:
       Television program follow-on;
       Arbitration court start-up;
       Investment and Development Agency public relations plan;
       Central historic district development;
       Technology park business plan and prospectus;
       Bank card system start-up;
       General banking training;
       Energy efficiency zone and company formation;
       Business plan for agribusiness wholesale terminal market;
       Agricultural skill training;
       Feasibility study for port operations improvement; and
       Port operations training program.
       Negotiations for major funding are underway with commission 
     working group support for projects developed from joint 
     Russian-Western actions in the following areas:
       Infrastructure Improvement Program (World Bank);
       Stock Exchange Clearing House;
       District Heating Project (World Bank);
       Energy Efficiency Center & Zone (World Bank);
       Energy Master Plan (Finnish Government, World Bank);
       Nuclear Energy Project (World Bank);
       Agribusiness Wholesale Market (World Bank, EBRD);
       Port Operations Improvements (World Bank, EBRD); and
       Guarantee Fund for Environmental Improvements.

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