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Russia: Three-Way Trade Routes Link U.S., China And Russia

Bellingham, Wash.; 24 April 1998 (RFE/RL) --Exporters on the Northwest Coast of the United States have a problem with their developing trade with the nearby Russian Far East. But they think it's a problem that can be fixed -- with a little help from their trade partners in Russia and China.

Here's the problem:

Currently, there is an imbalance of trade between the Pacific ports of Russia and the ports of Seattle and Tacoma on Puget Sound, the long finger of the Pacific Ocean that reaches around the mountainous barrier of the Olympic Peninsula into Washington state. Simply put, Russian demand for U.S. and Canadian goods passing west through Seattle and Tacoma far exceeds current American demand for the Russian goods now available for trade through the formerly closed Russian Far East.

"Basically, what we have is one-way trade," says Don Meyer, deputy executive director of the Port of Tacoma.

The port last week hosted a trade meeting that won the approval of the U.S. West Coast-Russian Far East Business Development Committee to create a new "East to West" trade corridor through Russian Far East ports and customs facilities and on to Harbin, the center of northeast China, a region of 100 million people. The committee stems from the continuing initiatives generated through what has been known as the Gore-Chernomyrdin Commission, named after the U.S. vice president and the former Russian prime minister.

"We all recognize that one-way trade is not a good thing in the long run," Meyer tells RFE/RL. "Sending out containers full of goods and bringing them back full of air isn't very cost effective," he explains.

Yet, the potential of the Russian Far East as an international trading center is hard to under-estimate, Meyer says. He notes, for example, the region's closeness to the powerful economies of China, South Korea and Japan.

The drawback for now is that the Russian Far East lacks the facilities needed to support international commerce. The region, after all, is just beginning a transition that may take years, from shedding its Soviet past as a highly secret military area to becoming an open international center for Pacific Rim trade.

The first concrete step along that route, the committee decided, will be to develop first-class customs procedures to speed clearing imports and exports passing through such Russian ports as Vladivostok. Meyer thinks that this project could serve as an example for improving trading facilities throughout Russia, not to mention the newly independent states and much of Eastern Europe as well.

"That may sound pretty basic," Meyer says of developing customs facilities and procedures, "but it's not in an area that was developed for reasons of defense and to support the Soviet Pacific Fleet" during the Cold War.

The next step, Meyer says, will be the convening of an international conference in September in Vladivostok. Meyer says the conference will include representatives of China as well as Japan and Korea.

Here's how the new "East to West corridor" will work:

Canadian and American goods now passing through Seattle and Tacoma near the U.S.-Canadian border will go on to Russia's developing Pacific ports, as at present. But some containers will then continue west to Harbin, where Chinese products will replace the North American and Russian goods for the return trip east -- nicely filling the trade containers that return mostly empty from Russia.

The plan, Meyer says, is to develop the necessary new trade agreements and Russian customs facilities over the next year and start trading as the new century opens.

Ultimately, he says, two-way trade is essential. After all, there have to be buyers as well as sellers at both ends.