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Russia: Finance Ministers Meet G-7 Counterparts

  • Robert Lyle

Washington, 5 October 1998 (RFE/RL) -- Russian Finance Minister Mikhail Zadornov and Central Bank Chairman Viktor Gerashchenko joined their counterparts from the G-7 group of major industrial countries in Washington Saturday (Oct. 3), but only for a small part of the regular meeting.

U.S. Treasury Secretary Robert Rubin, who is chairing the meeting of the finance ministers and central bank governors from Great Britain, France, Germany, Japan, Italy, and Canada, didn't even mention Russia when he outlined the agenda for the meeting at a press conference Friday.

The G-7 group will focus on dealing with the global financial crisis by generating growth in the industrial nations -- especially Japan -- and on ideas for remodeling the architecture of the international financial system to try to deal more effectively with crises that arise in the future.

Officials at the U.S. and British treasuries said the G-7 ministers are anxious to hear from Zadornov and Gerashchenko whether the new Russian government has come up with concrete plans for dealing with its collapsed economy. They also want to reiterate western concern that Moscow may shift away from market-oriented reforms and attempt to return to more state direction.

Although Rubin didn't mention Russia, U.S. Secretary of State Madeleine Albright spoke out boldly. Speaking to the U.S.-Russia business council meeting in Chicago, Albright said Washington is not reassured by what it is hearing out of Moscow.

"We have heard a lot of talk in recent days about printing new money, indexing wages, imposing price and capital controls and restoring state management of parts of the economy," she said.

"We can only wonder if some members of (Prime Minister Yevgeny) Primakov's team understand the basic arithmetic of the global economy," said Albright.

She said the U.S. is not reassured and "cannot say with confidence that Russia will emerge from its difficulties anytime soon."

U.S. officials said that while Russia's participation in the finance ministers/central bank governor's meeting was very limited, Russian officials are due to have a greater part in the Monday meeting of finance officials from 22 nations. It was called by the U.S. to discuss the architecture of the global financial system.

U.S. President Bill Clinton said the future prosperity of everyone in the world depends on all nations working together to restore confidence in and stabilize the global economy.

Speaking to reporters at the White House Friday, Clinton said the U.S. will explore at the Monday meeting whether there needs to be a new mechanism within the International Monetary Fund (IMF) to provide quick funding to help countries avoid financial contagion, and new mechanisms within the World Bank and the regional development banks for fast loans for social safety nets.

IMF and World Bank officials point out that both institutions have implemented such mechanisms in the past year. Rubin said Clinton was only proposing concepts and that specific ideas would be honed in the minister's meetings.

All of these gatherings are part of the run-up to next week's annual meetings of the IMF and the World Bank. The plenary sessions begin on Tuesday, but virtually every finance minister and central bank governor in the world is already in Washington this weekend to attend various side meetings and for a chance for one-on-one meetings with each other.