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Russia: Washington State Organizes Humanitarian Help

Tacoma, Wash., 25 November 1998 (RFE/RL) -- About 40 people gathered in the World Trade Center at the port city of Tacoma in Washington State to learn the latest on conditions in Russia and, in particular, in the Russian Far East, where many of them do business and want to continue, despite the current hard times there.

It is the third such group to convene this week in the state's three largest cities -- first in Spokane, east of the Cascade Mountains that divide Washington, and next 35 kilometers north of Tacoma, in Seattle.

The participants at these "updates" are made aware of efforts by the state government to encourage the federal government, across the continent in Washington, D.C., to broaden its habitual Cold War focus on Moscow when dealing with Russia.

Washington State wants some of the humanitarian aid and the more than 3 million tons of food aid that the United States is planning to send this winter to flow directly to the Russian Far East through Washington's bustling ports in Tacoma and at nearby Seattle to the north. The more usual route is across the North Atlantic to Moscow, seven time zones west of the Russian Far East, barely a time zone away from the U.S. West Coast.

These state officials -- and the state's farmers and dairy producers -- also want Washington State apples, pears, potatoes, dry milk, wheat and other crops to be part of the food-aid package to be bought by U.S. taxpayers for the Russian people.

Meg Van Schoorl of the Washington State Department of Agriculture tells RFE/RL that "we have heard that the Russian Far East is going to be a target area" of the recently announced 3-million ton, U.S. food-aid program. She says the aim is to get shipments flowing from Tacoma and Seattle before the year ends. The European Union this month agreed to send $500 million worth in food aid to Russia starting early next year.

At the Tacoma "update," participants include several people bringing Russian cultural events to the Pacific Northwest, representatives of Christian charitable organizations already operating private aid programs for orphanages and other needy Russian groups, as well as people from companies seeking ways to revive their fast-growing trade with Russia.

These people have seen business dry up since the events of August -- the Aug. 17 devaluation of the ruble and Russia's default on bond payments to banks that had bought the very high-interest government bonds. The result destroyed the fledgling finance facilities that let dollars and rubles flow back and forth between sellers and buyers in Russia and the United States.

Olga Romanjuk, the first Russian to run the Washington State trade office in Vladivostok, summarized efforts to sort out the banking mess in that city of 700,000 people, the major center of trade with the U.S. Pacific Northwest, along with Sakhalin.

Romanjuk differentiates among the banks: Few local Vladivostok banks, she says, had "gambled" on the high-interest government bonds that Moscow had put on the market, so these banks were less affected by Russia's debt default than the many bigger banks that had bought the bonds and suffered from Russia's default on scheduled payments.

Romanjuk says the healthy local banks are consolidating to enter the international trade finance sector. Two of these banks, she says, are now offering payment services.

Another development in the Russian Far East since August, she says, is that local manufacturers are finding that the cheaper ruble makes their goods more attractive to foreign buyers abroad These companies, she says, are in the market for the ingredients they need -- the raw materials or "inputs" -- to provide finished products, where profits are larger. They, too, need the payment facilities restored if they are to succeed.

What is beginning to happen in the Vladivostok region, Romanjuk says, is a "rearrangement of export products" in line with the emerging new current economic realities.

Romanjuk also brought the Tacoma group up to date on efforts to open a new trade route to China via Washington State and across the recently unfortified Chinese frontier with the Russian Far East. She says the problem of Chinese and Russian railroads running on different width tracks is being overcome by installing a third rail along the roadbed to allow both kinds of trains to operate across the border without having to transfer freight.

At the same time, efforts are under way to reform customs procedures within the Russian Far East for cargo passing through the region from the United States to China. Romanjuk urged the exporters present in Tacoma to try a "pilot shipment" of a freight container or two over this new "East by West" trade corridor through the Russian Far East to China.

Summing the current trade situation was Romanjuk's counterpart in Washington State's international trade operation, Alison Krupnick, who works out of Seattle.

Krupnick warned the group that much remains to be done to restore trade.

"So much of this is inconclusive," she says of the update information. But, she adds: "Our businesses don't want to lose the market share, and they don't want their partners (in Russia) to suffer."

Krupnick tells the Tacoma group: "We're doing the best we can to maintain the relationships we have."

(This is the second of two stories on the growing economic ties between the western U.S. and Russia, and on what Russia's Pacific Coast partners are doing to help Russia through its economic crisis.)