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Press Review: Russia's Shrinking Treasury; NATO's Mandate To Expand

  • Don Hill

Prague, 25 October 1996 (RFE/RL) -- Russia's deteriorating finances so concerned a delegation from the International Monetary Fund that its members left Moscow this week without completing agreement on furnishing the next stage of the IMF's $10 billion, three-year loan. The growing problem attracts Western commentary. Commentators also look at the continuing issue of Eastward enlargement of NATO.

Russia�s Money Problems

CHICAGO TRIBUNE: Need your wages? Take your boss to court.

Uli Schmetzer writes today "Moscow union leader Konstantin Krylov has given Russia's unpaid workers a new way to recover their unpaid wages -- 'Take your boss to court.' But in most cases this means suing the government. Labor Minister Gennady Melikyan acknowledged this week the state owes workers and pensioners the equivalent of $7.7 billion and its troops another $1.2 billion in back pay."

"Worse, Finance Minister Alexander Livshits made it clear that relief is unlikely, as projected revenue is 30 percent short of expenses and the International Monetary Fund could freeze a $10 billion loan unless Russia improves its tax collecting. So far a wave of protests, threats, work stoppages and even hunger strikes have failed to pry money from employers. Unpaid wages, due to corruption and badly managed enterprises, have remained the worst social problem of Russia's transition to a market economy," she wrote.

WALL STREET JOURNAL EUROPE: Russia and the IMF failed to agree

Neela Banerjee writes today "Russia's central bank said yesterday that the government and a visiting team of IMF officials failed to reach agreement on how to read several indicators of Russia's economic performance, which prevents the team from finishing its report on Russia too the IMF board. That means that the $340 million loan tranche expected for early November will be delayed."

"The government now must scramble to show an increase in revenue by the time the IMF team returns in the first half of November. The delay of the tranche will certainly drive up yields in the already expensive domestic T-bill market and could threaten what many had predicted would be a successful first Eurobond placement for Russia slated for later this fall," Banerjee continues.

NEW YORK TIMES: Tax evasion is Yeltsin�s biggest political problem

Michael R. Gordon wrote in a news analysis: "The report that Russia's Central Bank had failed to reach an agreement with the fund's experts was the latest sign that, three months after President Boris Yeltsin won re-election, chronic tax evasion has emerged as the most pressing political problem facing his administration. The growing roster of tax delinquents has forced the Russian government to delay paying wages and pensions, causing mounting public anger. It has also raised searching questions about Yeltsin's ability to impose financial discipline and govern the vast Russian state."

"As a result of a breakdown in talks between the bank and IMF experts monitoring Russia's compliance with the terms of its loan, the experts recommended that further disbursements of the three-year loan be delayed," Gordon writes.

NATO Expansion

THE NEW YORK TIMES: Expanding NATO may be a popular idea in the U.S.

Today�s editorial says: "Expanding NATO into Central and Eastern Europe may be a popular idea in the Midwest and other parts of the United States with large numbers of ethnic voters. President Clinton told an audience in Detroit this week that he would press for the admission of some new NATO members by 1999. Bob Dole favors expansion by 1998. But good politics does not necessarily make good foreign policy.

"Bringing countries like Poland, Hungary, and the Czech Republic into the NATO alliance before the end of this decade risks making the United States and Europe less secure rather than more so." The newspaper says: "The European Union, not NATO, should take the lead in incorporating Europe's new democracies into the Continental community," and concludes: "The wise way for the West to consolidate its victory in the Cold War is not to drive Russia into an aggrieved corner, but to try to engage it in a just and durable peace. "


Flora Lewis writes: "NATO is alive, well, transformed and sure to expand." She writes: "Even before the Warsaw Pact and then the Soviet Union disappeared, there were people in the West who urged dissolution of NATO as obsolete or provocative. Such people failed to appreciate how much it already had evolved."

Lewis concludes: "NATO is transforming itself and has already gone much further than generally is realized. It can now be said that NATO remains alive and well, and sure to keep on growing. One day Russia, too, will find that beneficial."

NEWSDAY: NATO needs a strategy for coming to closure with Russia

Anther voice favoring NATO expansion is that of Peter W. Rodman, senior programs director at the Nixon Center for Peace and Freedom. Rodman is a former White House and U.S. State Department official. He contended yesterday: "What the alliance needs now is not more speeches, but a strategy for coming to closure with the Russians on the matter. It's time to get on with it and to get this behind us. Such a strategy should combine conciliation and firmness."

"If the new relationship between Russia and the West is to get off on the right foot, it presupposes that Russia accept the irreversibility of the revolution of 1989 in Central Europe -- and of 1991, as far as the Balts, Ukrainians, and others are concerned. It presupposes, in other words, that Russia call off the dogs on NATO enlargement. This is not too much to ask. If that happens, there is no objective basis for great-power conflict in Europe, and the fundamental stability of Europe, for all concerned, looks as secure as it has ever been since the beginning of this century," Rodman argued.

INTERNATIONAL HERALD TRIBUNE: Strength and credibility is at stake.

Frederick Bonnart, an editor of NATO's Sixteen Nations, an independent military journal, urges cautious gradualism in NATO expansion. He writes: "What is at stake is the strength and credibility of the alliance and its ability to assure the security of Europe." He says: "Initially, no more than one country should be invited, with a promise to only two more in a projected time frame."