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Russia: Food Aid To Be Closely Monitored

Moscow, 12 March 1999 (RFE/RL) -- The first delivery of U.S. food assistance to Russia has arrived by ship in St. Petersburg and is being unloaded today.

The U.S. ambassador to Russia, James Collins, is expected to be on hand to witness the unloading.

Collins told a press conference in Moscow yesterday that U.S. and Russian officials have worked very hard to create a program that will, in their judgment, "reach the people intended to be provided for." He said the U.S. government has set up a broad system to monitor the Russian government's compliance with terms of the deal.

Under the agreement, the U.S. is to provide Russia more than 3 million metric tons of food and grain products, worth approximately $950 million.

Russia and the United States initially agreed on the food program in November, after Russia suffered its worst harvest in 40 years and concern was growing over the consequences of the August 17 financial meltdown. The program was delayed partly because U.S. officials sought assurances that the deal would not be tainted by corruption. A similar program in 1992 proved to be ridden with graft. Much of the aid appeared on sale through black market channels, while another portion simply disappeared.

The shipment being unloaded today consists of 1,000 tons of seed for green peas. Interfax news agency quotes Russia's deputy agriculture minister Vladimir Alghinin as saying that this shipment will be distributed in the Russian regions of Mordovia, Belgorod, Novgorod, as well as in the republics of North Ossetia, Kabardino-Balkaria and in the Krasnodar district.

A second shipment, containing 14,000 tons of corn seed, is scheduled to arrive on March 17 and other tranches will follow.

A U.S Embassy statement distributed at yesterday's press conference said that work plans and distribution schedules concerning the deal are public and can be found on the internet (at the web site WWW.FAS.USDA.GOV).

The assistance includes gifts and loans aimed to help Russian regions running low on locally produced food, seed and feed for livestock, and unable to afford imports after the ruble lost much of its value last August.

Collins said that approximately one-third of the commodities will come as seeds and feed for livestock and is to be sold on the Russian market.

Of the remaining two-thirds, some 500,000 tons will be used for direct free deliveries by the Russian government and some private voluntary organizations to needy civilians.

The rest, Collins said, will be sold by regional authorities at market prices.

A joint U.S-Russian government working group will determine minimum values for the sale of commodities by regions and monitor the entire process, including tracking payments into two Pension Fund accounts.

Collins said: "The fundamental thing we can verify is that [a certain] amount of grain arrives on a given day ... it will be put on the market at a given price ... and [we'll know] how much money is to be deposited within 120 days into one of these two accounts." Collins said Russia's domestic supplies are running out and the need for assistance to farmers and needy people is now more urgent than ever.

Earlier this week Russian Deputy Prime Minister Gennady Kulik, who is supervising the deal for Russia, said that the Russian government has done all it can to avoid corruption. Interfax news agency quoted Kulik as saying that the monitoring commission including Russian law enforcement officials and U.S. officials will ensure that the assistance operation is "smooth, transparent and successful."

Many Russian citizens and observers, however, are skeptical. Kulik has been accused of corruption by Russian media and politicians.

The Russian government has selected a number of companies to handle deliveries, but failed to do so through an open tender. Roskhlebprodukt, a partially state owned company that in 1992 oversaw the controversial distribution of U.S. food aid to Russia, will again be one of the companies handling deliveries. Collins declined to comment on Roskhlebprodukt's involvement, saying that the question "should be addressed to the Russian government." But he said U.S. officials will be following developments:

"If any part of the agreement is not fulfilled, the American side can stop the shipments at any time."

Meanwhile, first deliveries under a $500 million package from the European Union are also expected soon.

An EU official in Moscow told Reuters that the first EU deliveries will be of German meat and that they will arrive by train on March 24. A ship carrying EU wheat is due to dock in Kaliningrad March 30.

Some Russian officials criticized the agreements, saying they are inefficient, and risk driving some farmers out of business. Former Deputy Prime Minister Boris Nemtsov has said that "poor people will never get any visible results from humanitarian assistance."