[Weekly Compilation of Presidential Documents Volume 33, Number 12 (Monday, March 24, 1997)]
[Pages 393-395]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
Joint Statement on United States-Russia Economic Initiative

March 21, 1997

    President Clinton and President Yeltsin have committed to a joint 
initiative to stimulate investment and growth in Russia, deepen U.S.-
Russian economic ties and accelerate Russia's integration with global 
markets. In so doing, the Presidents underscored the vital importance of 
bold measures to complete Russia's historic transformation to a market 
economy. This transformation is in the mutual interest of the United 
States and Russia--to meet the aspirations of the Russian people for a 
more secure and prosperous future, and to encourage trade, investment 
and new jobs in both countries. Both Presidents affirmed their 
commitment to achieve the vast potential of U.S.-Russian economic 
cooperation.
    The Presidents discussed recent economic developments in their 
countries and objectives for the future. The process of unprecedented 
transformation of Russia into a democratic nation that respects private 
ownership and the principles of a free market is continuing. In the past 
five years, a once non-existent private sector has emerged to produce 70 
percent of Russia's national income and employ 55 percent of the Russian 
workforce. With basic market structures now formed, markets, not the 
state, increasingly allocate resources and drive prices and business 
decisions. Private banks, capital markets and commodity exchanges are 
emerging as the new institutions underpinning Russian economics. 
Inflation has been sharply reduced, and Russia has begun to enter 
international capital markets. Taking into account these changes, the 
United States and Russia will consider problems connected with the 
regulation of trade between the two countries, take steps to increase 
access to each other's markets, and establish the appropriate condi

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tions to extend Most Favored Nation status to Russia on a permanent and 
unconditional basis.
    President Yeltsin outlined Russia's plans to enact and implement a 
new legal regime that convincingly demonstrates Russia's commitment to 
attracting foreign and domestic investment. His highest economic 
priority is a tax regime that both meets the revenue needs of the 
Russian government and stimulates legitimate

 business, including actions on the value-added tax, excise tax, and both 
corporate and individual income taxes. Russia will act to pass a new tax 
administration law that clarifies authorities, responsibilities, fines and 
the ability to resolve disputes. In the energy sector, measures will be 
taken to pass legislation that brings into full force Russia's Production 
Sharing Agreement law and provides the authority to develop PSA fields. New 
efforts will be made to ratify the U.S.-Russia bilateral investment treaty. 
The Presidents committed to deepen cooperation to fight economic crime. 
President Yeltsin highlighted his plans to consolidate the rule of law and 
to strengthen Russian legislation aimed in particular at combating money 
laundering and organized crime. President Yeltsin stressed the importance 
of the quick adoption of a new criminal procedure code. He will pursue the 
substantial completion of this agenda by the end of 1997. Further, the 
Presidents committed to work together to meet the challenge of attracting 
investment in order to utilize the vast human and natural resources that 
Russia possesses.

    President Clinton stated that U.S. Government agencies will maximize 
support under their programs to finance American investment in Russia. 
U.S. efforts will include intensified efforts for project finance, 
political risk insurance and investment funds through the Overseas 
Private Investment Corporation; expanding financing for transactions 
involving equipment exports through the Export-Import Bank that will 
result in capital investments in the Russian economy; and additional 
investments through the U.S.-Russia Investment Fund.
    The Presidents applauded plans announced by Vice President Gore and 
Prime Minister Chernomyrdin to launch a regional investment initiative 
that will attract resources to key regions, including the Russian Far 
East, to demonstrate the impact of joint efforts on policy reform and 
investment finance and to create new channels of commercial cooperation 
between regions in both countries. The United States and Russia 
recognize that Russian action on its economic agenda is key to building 
investor confidence and creating the demand needed to translate American 
financing into real investments in Russia. Toward this end, President 
Clinton is seeking additional funding in 1998 to expand U.S.-Russian 
economic cooperation, with a focus on tackling barriers to investment 
and doubling exchange programs between Americans and Russians, including 
the introduction of a new program to forge long-lasting connections 
between young, highly qualified individuals likely to emerge as 
influential leaders in future U.S. and Russian societies. The Presidents 
looked forward to the work of the joint Capital Markets Forum, which 
will bring together public and private sector participants to support 
the rapid development of Russia's capital markets.
    Presidents Clinton and Yeltsin affirmed that cooperation to 
integrate Russia's economy into the global economic system represents 
one of their most important priorities. The United States and Russia 
will intensify their efforts to accelerate Russia's integration into the 
international economic community. The Presidents set as a target that 
both sides would undertake best efforts for Russia, on commercial 
conditions generally applicable to newly acceding members, to join the 
World Trade Organization in 1998, and to join the Paris Club in 1997 
assuming agreement on conditions of membership. Together, the United 
States and Russia will define tasks which need to be accomplished and 
set targets for their completion in order to achieve this objective. 
They also count on making considerable progress toward Russia's 
accession to the Organization for Economic Cooperation and Development.
    The Presidents agreed that Vice President Gore and Prime Minister 
Chernomyrdin should broaden and intensify the work of the U.S.-Russian 
Commission on Economic and Technological Cooperation. The Presidents 
welcomed the Commission's efforts to move beyond cooperation between 
federal govern

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ments to foster regional and local ties between the peoples of their 
countries. They noted the Commission's important achievements in the 
fields of trade and investment, energy, environment, health, defense 
conversion, agriculture, space, and science and technology. They 
recognized the Commission's leadership role in carrying forward 
bilateral relations into the twenty-first century.
    Presidents Clinton and Yeltsin expect that as the century turns, 
their joint initiative will result in a strategic economic partnership 
between the United States and Russia that will decisively strengthen 
bilateral ties and positively shape changes in the world economy. They 
look forward to a prosperous and market-oriented Russia as a full 
partner in the premier organizations that will define economic and trade 
relations for the twenty-first century. This will allow Russia to take 
its place among the community of nations contributing to a new 
international economic order where open markets and free trade foster 
global prosperity and the well-being of American and Russian citizens 
alike.

Note: An original was not available for verification of the content of 
this joint statement.