[Weekly Compilation of Presidential Documents Volume 29, Number 14 (Monday, April 12, 1993)]
[Pages 547-552]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
Fact Sheets From the Russia-United States Summit

 April 4, 1993

Humanitarian/Health Assistance and Food Sales

Purpose

    To respond to the need for humanitarian food and medical assistance 
and to help develop the proper infrastructure for health care delivery, 
the United States will provide grant food and medical assistance, health

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technical assistance, and concessional sales of U.S. agricultural 
commodities to Russia.

Program

    Grant Food Assistance: The United States will provide an additional 
$194 million in grant food aid to Russia, bringing total grant food 
assistance for Russia to $425 million in FY 1993. This is provided under 
the Section 416(b) and Food for Progress programs administered by USDA. 
Some of the commodities will be provided directly to the Russian 
Government for direct distribution or sales to needy individuals, while 
other commodities will be auctioned on private commodities exchanges. A 
certain amount of the commodities will be provided through American and 
Russian private voluntary organizations. ($194 million)
    Food for Mothers and Children: The United States will provide infant 
formula, whole fat milk, cereals, and nutritional powdered beverage to 
needy infants, children, and mothers in Magadan, Khabarovsk, and 
Vladivostok. ($10 million)
    Medicines and Medical Supplies for Russian Hospitals: The United 
States will provide medicines and medical supplies to hospitals in the 
Moscow area and medical supplies to hospitals and clinics in the Magadan 
region of the far east. ($15 million)
    Medical Partnerships: In an effort to increase contacts between 
American and Russian medical professionals, the United States will 
establish an additional four medical partnerships in Russia over the 
next several months. This will make a total of nine partnerships in 
Russia. ($3 million)
    Health Care Finance: An integral part of transition to a market 
economy will be the reform of the health care system. To assist in this 
transition, the United States will work with the Russian Government to 
promote private health care alternatives. The United States will provide 
training and seminars and seek to establish replicable models of health 
care finance in reform-minded communities of Russia. ($2.5 million)
    Food for Progress Credit Sales: The United States will make 
available $700 million in agricultural credit sales to Russia under the 
Food for Progress program. These sales are an interim measure designed 
to restore Russia's access to U.S. agricultural markets for grains and 
other needed commodities in the short term. The commodities will be 
delivered for the next several months, until Russia's domestic harvest 
begins to become available.
    Total Funding for Humanitarian/Health and Food Sales: $924.5 
million.

Private Sector Development

Purpose

    The U.S. private sector assistance program supports Russia's 
historic transition to a market-based economy, expanded trade and 
investment opportunities, and emergence of an indigenous private sector. 
U.S. assistance reinforces Russia's strategy to transfer state assets to 
productive private sector use and to catalyze small and medium business 
development to create new jobs. Whenever possible, the U.S. assistance 
program links American businesses with Russian counterparts to transfer 
skills and create lasting market relationships.

Program

    Russian-American Enterprise Fund: The fund will target loans and 
investments to create and expand small and medium enterprises. It will 
support Russian businesses and joint ventures with U.S. firms that 
disseminate Western business know-how and practices. Loans and 
investments will seek to increase employment, develop capital markets, 
generate foreign exchange, encourage private foreign investment, and 
support privatization. The fund will also seek to demonstrate that good 
business investments are compatible with sound environmental practices. 
($50 million in 1993)
    Privatization: Privatization is the driving force behind economic 
reform in Russia. This initiative reinforces nearly every aspect of the 
privatization program that is giving all Russians their first 
opportunity to become private shareholders. U.S. assistance supports 
enterprise auctions, privatization manuals, public education on private 
ownership, and legal, economic, and logistical advice to local 
privatization committees. Technical assistance for investment funds, 
stock exchanges, prudent regulation, and business support organizations 
will help create a fair and competitive marketplace. ($60 million in 
1993)

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    Bankers Training: A modern banking system and stable financial 
markets are indispensable to enterprise restructuring. Officials of U.S. 
commercial banks, the Federal Reserve Bank of New York, and other 
specialists will train at least 250 Russian banking executives. American 
experts will work with Russian counterparts to introduce new deposit 
mechanisms for business and household savings, functioning checking 
accounts, interbank credit and reserve lending systems, and an auction 
market in government securities that will facilitate relatively 
noninflationary financing of public deficits. ($5 million)
    Fiscal Sector Reform: Effective decentralization and privatization 
will require new tax and expenditure systems for local and regional 
governments. Technical assistance in the fiscal area will help local and 
regional governments design and implement fiscal structures, including 
revenue systems needed to finance social services and other budgetary 
requirements currently financed by state enterprises. Assistance will 
start with Moscow oblast and will be targeted at regions making 
significant privatization progress. ($4.4 million)
    Russian-American Agribusiness Partnerships: This activity pairs U.S. 
agribusinesses with Russian partners to help private farmers, 
enterprises, and reform-oriented institutions create a market-driven 
food system. Technical assistance and training by U.S. agribusinesses 
will help break bottlenecks between producers and consumers and create 
efficient input delivery systems. U.S. agribusinesses will introduce 
U.S. standards for harvesting, processing, and distribution. Under the 
project, they will invest approximately $60 million of their own funds. 
($20 million)
    Farmer-to-Farmer Program: This activity will link over 300 American 
volunteer farmers with farmers in Russia in order to provide direct, 
practical agricultural marketing experience and know-how. These 
volunteers will build on the work of 80 volunteers already in Russia. 
Their technical expertise will help new private farmers learn the skills 
needed to operate in a market economy, improve crop quality, reduce 
losses, and respond to consumer demand. ($5 million)
    Eurasia Foundation: The foundation is a new, independent grant-
making and technical assistance fund established with U.S. Government 
financing. It will encourage collaboration with and contributions from 
private funding sources. The foundation will support innovative, field-
based programs throughout the N.I.S. in areas such as management 
training, economics education, public policy advice, independent print 
and broadcast media, and science and technology development. ($4 million 
for Russia)
    Total Private Sector Development Program: $148.4 million in 1993.

Democracy Corps Initiative

Purpose

    Russia is embarking on the transformation of its political and legal 
framework from an authoritarian foundation to one based upon the rule of 
law, with emphasis on rights and responsibilities of individuals, 
popular participation in political and economic decision-making, open 
competition among interest groups, governmental accountability, 
transparency of political and legal processes, and predictability in 
social and economic relations.

Program

    To assist this process, the President is mobilizing the Democracy 
Corps, a broad coalition of American people and institutions devoted to 
expanding the momentum for democratization in Russia. As the Coordinator 
for all U.S. assistance efforts with the former Soviet Union, Ambassador 
Tom Simons will oversee Democracy Corps activities in Russia. Specific 
U.S. Government-funded activities in FY 1993 will include:
    Democracy Summer: The summer of 1993 will be designated ``Democracy 
Summer,'' with the startup of a $25 million program of intensive people-
to-people contacts between Russians and their American hosts. 
Approximately 3,000 Russians will be brought to the U.S. for exchanges 
and training in 1993. Two types of contacts are envisioned:
    Exchanges: Exposure of Russians to life in a democracy can foster 
grassroots understanding and attitudes supportive of democratic 
development. About 1,700 high school students will arrive this summer 
for a variety

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of programs: Over 300 will participate in short-term thematic group 
projects in areas ranging from culture and the arts to youth leadership, 
650 students will participate in year-long exchanges during the 1993-94 
school year, and 750 students will participate in month-long school-to-
school linkages. About 450 undergraduate and 200 graduate-level Russian 
students will receive training in economics, business, public policy, 
government, education, and law. Another 200 government officials and 
professionals will participate in short-term education programs designed 
to introduce them to their American counterparts.
    Training: In addition to exposure to democratic systems, visits by 
citizens of Russia to the United States can demonstrate U.S. methods of 
solving technical, managerial, and other problems that are key to 
Russia's successful adoption of a free market system. About 400 Russians 
will be brought to the U.S. for study tours and short-term training 
programs in key technical areas such as banking, energy, environment, 
health, and agriculture.
    Rule of Law: These programs will mobilize a broad range of U.S. 
legal resources to assist the Russian reform of their legal structure to 
reflect democratic and free market principles, and to institutionalize 
support procedures and practices in the areas of commercial law, 
criminal law and procedure, and legal education. In particular, the U.S. 
will directly support President Yeltsin's Legal Experiment, an 
innovative plan to advance legal reform, including the creation of a 
jury system in five regions. ($5 million)
    Effective Local Governance: The U.S. will assist reform-minded local 
governments in generating, managing, and expending financial resources 
in ways which foster the private provision of social services and broad 
private sector growth. The first two cities targeted are Moscow and 
Nizhni Novgorod. ($7 million)
    Strengthening Civil Society: The U.S. will mobilize private U.S. 
organizations (political and civic organizations, free trade unions, and 
advocacy groups) to work closely with counterparts in Russia--reformers, 
grassroots organizers, regional interests--to expand their participation 
in Russian political processes and in the dialogue on economic reform. 
($2 million)
    Strengthening Independent Media: This program will allow the U.S. 
media and journalism community to share professional journalist 
techniques and business and managerial skills essential for functioning 
of a free and open democracy. ($2 million)
    Developing Russian Volunteerism: A wide slice of the U.S. private 
voluntary organization community will assist private Russian groups to 
meet emerging social service needs during this period of economic 
dislocation. ($4 million)
    Developing University Partnerships: The U.S. will mobilize the U.S. 
education community to develop linkages and exchanges between American 
universities and partner universities in Russia that focus on areas 
critical to the creation of free market and democratic institutions. The 
administration will establish an American Institute at the Institute of 
Foreign Languages in Nizhny Novgorod for study of American studies and 
language. ($3 million)
    Total Democracy Corps Initiative: $48 million in 1993.

Officer Resettlement Initiative

Purpose

    The United States and the West have an historic opportunity to 
facilitate the return of troops to Russia by providing housing and job 
retraining for Russian officers who are being demobilized and returning 
to Russia. This officer resettlement initiative responds to a direct 
appeal from the Government of Russia.

Program

    This initiative will focus on facilitating the resettlement of 
officers who are being demobilized upon return to Russia. In addition to 
building houses for these returning officers, it will provide employment 
retraining. Specifically it will, on a demonstration basis, build 450 
houses within 12-16 months for officers who are being demobilized and 
returning to Russia, and provide employment training for the 
participating officers to facilitate their transition to civilian life.
    Houses will be built in areas where local authorities are committed 
to market economic reforms. These sites also will be se- 

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lected based upon availability of land, adequate infrastructure, and 
proximity to good transportation routes. To the extent possible, we will 
seek to use local labor and locally available materials in the 
construction of these homes.
    Providing housing and job retraining for troops returning to Russia 
is a visible sign of Western support for the Russian people and the 
Russian Government. The United States will seek to encourage other 
donors to implement similar or complementary programs. We will also seek 
to expand this initiative in the future.
    Total FY 93 funding: $6 million.

Energy and Environment Initiative

Purpose

    This initiative will assist in the transformation of the Russian 
energy economy into a market-oriented, end-use efficient, and 
environmentally protected system. Reform of the energy sector is 
essential to the viability of the overall reform program, particularly 
enterprise restructuring and the overall macroeconomic balance. 
Structural reform of this sector should help remove some of the worst 
environmental excesses by eliminating obsolescent production techniques 
and encouraging energy efficiency.

Program

    This initiative represents a balanced approach targeted on several 
critical leverage points:
    Gas/Oil/Coal Production and Delivery Systems Improvement: U.S. 
assistance will promote efficient use of gas and oil. Reform in these 
areas will increase hard currency exports and, in the long run, provide 
alternative fuel sources needed to decommission unsafe nuclear reactors. 
In addition, our programs will promote coal mine safety, productivity, 
and cleaner coal technologies. Funding will include engineering and 
financial analyses to help catalyze and accelerate substantial World 
Bank and EBRD loans to revamp production, transmissions, and 
distribution systems. ($10 million)
    Efficiency and Performance Improvement: This program will focus on 
improving energy efficiency in electric power, refineries, industries, 
and residential buildings. Funding also will support the Moscow Energy 
Efficiency Center which provides information on technology available 
from U.S. companies as well as training. ($2 million)
    Pricing, Policy, and Institutional Reform: Market-driven approaches 
for energy supply and demand balance in Russia will be introduced. The 
program will focus on privatizing energy supply entities, supporting 
reform of the price and tariff structure, and improving institutions to 
raise efficiency standards and introduce a regulatory framework. ($5 
million)
    Nuclear Power Plant Safety and Regulation: The U.S. will fund short-
term operational safety improvements, risk reduction measures, and 
regulatory assistance for nuclear power plants. ($15 million)
    Environmental Policy and Technology Cooperation: This program will 
assist in the development of clearer national environmental policies and 
programs. The U.S. will implement high-impact demonstration projects to 
reduce severe pollution problems, including minimizing use of ozone-
depleting substances. The first activity will focus on air pollution 
control in the Volgograd region. ($5 million)
    Environmental Non-Governmental-Organization Consortium: The U.S. 
will mobilize a consortium of public and private sector actors to 
strengthen collaboration between American and Russian NGO's. The 
consortium will finance joint U.S.-Russian NGO projects that promote 
community environmental quality initiatives, resource conservation, 
public awareness, and training. ($1 million)
    Total Energy and Environment Initiative: $38 million in 1993.

Trade and Investment

    Current U.S. bilateral trade with Russia is only $3.4 billion, and 
even though American companies are the largest investors in Russia, 
total U.S. investment is estimated at only $400 million. A significant 
expansion in bilateral trade and investment is among the best ways to 
assist Russia in making the transition to market democracy. Creating the 
necessary business climate is a task that basically rests with Russia, 
but the U.S. Government can play a catalytic role in helping to remove 
obstacles blocking projects already under dis- 

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cussion, improve the environment for business, and develop the 
commercial infrastructure.
    Business Development Committee: President Clinton is making 
bilateral trade and investment growth with Russia a major priority. 
Implementation is centered in the U.S.-Russia Business Development 
Committee (BDC) cochaired by Secretary of Commerce Brown and Deputy 
Prime Minister Shokhin. Secretary Brown will travel to Moscow to begin 
the process in May. The BDC will be the primary vehicle to help identify 
and remove impediments to trade and investment, unblock specific U.S. 
investment projects, press for Russian Government policy reforms, and 
improve the commercial infrastructure for bilateral commercial growth. 
The BDC meeting will focus on eliminating obstacles to investment in the 
energy sector and will include a high level session of the Defense 
Conversion Subcommittee.
    Generalized System of Preferences: President Clinton seeks to extend 
the U.S. Generalized System of Preferences (GSP) to Russia to provide 
duty-free treatment for a broad range of Russian exports. Over 440 
million of Russian goods will benefit.
    GATT: The United States will support Russia's application to become 
a member of the GATT and will help build the institutions necessary for 
Russia to become a full GATT member.
    American Business Centers: The administration will open four 
American Business Centers in Russia this year to help American and 
Russian companies do business with each other and to serve as business 
incubators.
    Export Control Development: Technical assistance will be provided to 
Russia to improve its export controls development. An effective Russian 
export control system would allow the sale of higher levels of 
technology to Russia to assist the reform and modernization of the 
Russian economy.
    Eximbank Loan: The Export-Import Bank of the United States has just 
finalized an $82 million loan to finance sale of Caterpillar pipeline 
construction machinery for Gazprom. This equipment will be used on 
construction of a gas pipeline in the Yarnal Peninsula region of Russia.
    OPIC Investment Support: The Overseas Private Investment Corporation 
(OPIC) has approved its first loan and major insurance coverage to a 
private commercial venture in Russia, a $150 million package consisting 
of a $50 million loan guarantee and $100 million investment insurance 
coverage to support CONOCO's $300 million Polar Lights project.
    TDA Feasibility Study Grants: The U.S. Trade and Development Agency 
(TDA) is granting $1.4 million for oil and gas feasibility studies as 
part of a package of TDA grants totaling $3.8 million.
    Special American Business Internship Training (SABIT): 300 
additional internships with American companies are being created for 
business executives, entrepreneurs, and scientists under the Commerce 
Department's highly successful business internship program. This doubles 
the number of Russians who will acquire on-the-job experience in a 
market economy. ($2 million).
    Total Trade and Investment Development Program: $9 million in direct 
program expenditures; trade and investment loans and guarantees; 
expanded trade and investment.