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World: Kosovo Reconstruction And Russia Dominate As Weekend Summit Ends

  • Mark Baker

Leaders of the Group of Seven (G-7) most industrialized democracies and Russia today completed a weekend summit in the German city of Cologne. Our correspondent Mark Baker reports on the main results of the gathering.

Cologne, 20 June 1999 (RFE/RL) - In spite of a long agenda of economic topics, the Cologne summit was dominated by events in Kosovo and the general issue of the West's relations with Russia in the wake of NATO's bombing campaign in Yugoslavia. The mood at the summit was buoyed by an agreement in Helsinki on Friday paving the way for Russian participation in an international peacekeeping force in Kosovo (KFOR).

The summit host, German Chancellor Gerhard Schroeder, acknowledged that Kosovo had played a major role in the discussions. In a final address to end the summit, he said progress had been made in working out international fund for aiding in the reconstruction of Kosovo and the return of refugees to the province. He said Germany will sponsor an international conference in the Balkans to spur the reconstruction effort:

"Solving the Kosovo problem was an important aspect of the discussions here. The Stability Pact for the Balkans -- as worked out at the suggestion of the Germans -- has been seen as a big success. The foreign ministers have done good work. At the suggestion of the American president, Germany will organize a summit to consider questions of the stability pact. The conference will be held in one of the Balkan states. We want to take psychological advantage of being on the spot to help in the reconstruction."

Leaders spent much of yesterday and today discussing the terms of the Kosovo reconstruction fund. A European Union official said the EU would supply around $500 million a year in assistance for three years. The Japanese said they would contribute around $200 million.

The money would be used for rebuilding Kosovo and would be separate from a larger Balkans reconstruction pact. The details for the funds are to be worked out at an international donors' conference next month.

G-7 leaders insisted that Serbia would not qualify for any reconstruction help as long as Yugoslav President Slobodan Milosevic remains in power. Russian officials had earlier objected to this.

Russia, however, later agreed to a joint statement on regional issues which would make aid to Serbia available only if it commits itself to democratic and economic reforms. The statement stopped short of demanding Milosevic's removal from power.

Schroeder affirmed that reconstruction money would not be made available to Serbia under Milosevic's rule. However, he said that Serbia would receive "humanitarian assistance."

Today's session featured an appearance by Russian President Boris Yeltsin, who arrived in Cologne this morning for one day.

Yeltsin on arrival said he was in Cologne to repair Russia's relations with the G-7 nations that were badly strained by NATO's bombing campaign in Yugoslavia.

Yeltsin told the leaders that they should work toward making changes in international law. He didn't provide details but said the proposals should be sent to General Assembly of the United Nations. He said their eight nations should be prepared to discuss the changes at a summit next year in Japan.

Yeltsin also held bilateral talks with Schroeder and U.S. President Bill Clinton. The talks centered on Western assistance for Russia's economic reforms, the rescheduling of Russian debt to the Paris club of government lenders and, generally, on Russian relations with the West.

U.S. National Security Advisor Sandy Berger said that Clinton's talks with Yeltsin had been "very positive" and that the two leaders were ready to move beyond Kosovo and focus on the future.

"The president (Bill Clinton) said essentially that our relationship had been tested in the past four months and that it had passed the test. He thanked president Yeltsin for not giving up on the relationship and for deciding that even if they could not join us in the war, they would help make the peace. He said now it's time for us to focus on other areas and Yeltsin agreed on that formulation."

Berger said the two presidents discussed future cooperation in arms control. He said Yeltsin remains committed to seeking ratification of the Start Two arms reduction treaty. The two also agreed that they will resume discussions on the Start Three arms reduction treaty and the anti-ballistic missile treaty (ABM). Berger said the talks were significant because for the first time the Russians agreed to consider changes in the wording of the ABM treaty that may allow the U.S. to deploy an anti-missile system if it chooses to do so.

In terms of economic issues, the eight leaders said important progress had been made in two areas: improving what they called the financial architecture of the world economy and providing possible debt relief for the world's poorest nations.

The initiatives include ways to increase the transparency of monetary flows to lessen the ability of hedge funds to manipulate governments and currencies. In terms of debt relief, the leaders agreed on a plan that could lead to forgiveness of about $70 billion dollars of the more than $200 billion in third world debt to multinational lenders and governments.

On Saturday, the summit became the focal point for religious leaders and groups who say the debt relief provisions do not go far enough in relieving the burden on poor countries. Around 30,000 people formed a human chain around the summit grounds in central Cologne to raise awareness of the debt issue. The protest passed peacefully without serious incident.

In a final communique, the leaders also said they welcomed the outline agreements between Russia and the IMF and the World Bank. They also called for a speedy implementation of IMF backed reforms in Russia. They said that once a final IMF agreement is in place, they would encourage the Paris club of creditors (eds: national government creditors) to negotiate a debt-rescheduling agreement.

Russia is trying to reschedule or write off thousands of million dollars of Soviet-era debt. Germany is Russia's largest creditor.