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CIS: Putin Appoints New Envoy On Regional Affairs

Russian President Vladimir Putin this week named Industry and Energy Minister Viktor Khristenko as his envoy on integration affairs for the Commonwealth of Independent States (CIS), the 12-member grouping of former Soviet republics.

Prague, 14 July 2004 (RFE/RL) -- Russian President Vladimir Putin this week summoned his ambassadors to Moscow and urged them to improve Russia's image abroad as an attractive investment opportunity.

At that same meeting, Putin also urged his envoys to do everything in their power to strengthen ties with what some in Russia still refer to as "the near abroad."

"It is necessary to exert every effort to support the integration processes taking place in regional unions, particularly such as the Eurasian Economic Community and the Single Economic Space," Putin said. "Besides, it is necessary to try to make relations between Russia and other CIS countries as attractive as possible -- not only for us, but also for them."

Putin tasked Industry and Energy Minister Khristenko with overseeing the job from Moscow's end. Khristenko is a familiar face who initially joined the Russian Finance Ministry in 1997 as a deputy minister. Later, he was made deputy prime minister in charge of energy -- a post he held until the government reshuffle in February, when he assumed full control of the energy portfolio as minister.
Khristenko has said that "institutionalized economic integration" is the only long-term solution for Russia.

For years, Russia has talked about its desire for closer CIS integration, and several smaller groupings -- as Putin mentioned -- have emerged, all with the goal of recreating some of the links cut during the collapse of the Soviet Union.

But nearly all analysts agree that, declarations aside, little real progress on genuine economic integration has been made -- witness the problems encountered by Russia and Belarus alone in their ill-fated union.

Part of the problem lies in the way Russia would like to integrate the CIS, as Nicholas Redman, of the Economist Intelligence Unit, told RFE/RL.

"If they encourage multilateralism they would also encourage greater links between the non-Russian CIS states, which is not necessarily what Russia wants," Redman said. "It would be better for Russia if all relations within the CIS went through Moscow."

Putin denied on 12 July that Russia holds a Moscow-centric view of CIS integration.

"It is important to stay away from declarations that no one except Russia has the right to take on the leadership role on the CIS territory," Putin said. "If we have accepted certain new realities, we should take them into consideration and proceed from them in building our foreign policy."

But judging from what his newly appointed envoy has said in his recent speeches, the evidence contradicts Putin.

Khristenko, earlier this year, published a lengthy policy paper in the foreign policy journal "Russia in Global Affairs" in which he made the case for CIS integration.

In the article, Khristenko notes that during the past few years, Russia's economic growth has been fueled by energy exports.

But in order to guarantee stable, long-term growth, Russia's service and manufacturing sector will have to be expanded. The problem is that many Russian goods and services cannot yet compete on world markets. Khristenko's solution? Expand the boundaries of Russia's market by creating an economic space with as many CIS countries as possible.

"Institutionalized economic integration," as he puts it, is the only long-term solution for Russia.

According to Khristenko, this will benefit both Russia and CIS states, which find themselves in a similar predicament. But that may not necessarily be the view in Kyiv or Tashkent, especially if, as Khristenko writes: "As part of a common economic space, Russia would be more confident in pursuing its interests, while relying on common resources."

In other words, Moscow will pursue its interests on the world stage in its role as a "history-making actor," as Khristenko writes, while sharing in the resources of its CIS neighbors. To some, this may be too reminiscent of the old Soviet model. Especially when it comes to oil and gas exports -- energy-rich countries such as Kazakhstan and Azerbaijan may not be willing to play to Moscow's tune.

Khristenko notes that an added benefit of CIS economic integration would be to offer foreign investors a single market, reducing bureaucratic hassles and administrative costs.

But here too, there is a problem. As Russia negotiates to join the World Trade Organization (WTO), any preferential agreements or commitments it has with other CIS states could complicate its entry.

"Regional trade agreements tend to run against WTO-accession requirements because the problem is that whatever deals [Moscow gives] to the CIS will then be demanded by the states that are yet to agree to Russia's WTO accession," Redman said.

Khristenko and Putin's other ambassadors -- who were tasked with improving Russia's image in the wake of the scandal over the Yukos oil giant -- clearly face a difficult task in the months ahead.