Clinton offers no new help

 

As Russia's political and economic crisis deepened, President Clinton warned its leaders against "reverting to the failed policies of the past" and spelled out four ways to keep economic reforms on track.

But Mr Clinton offered no new financial aid to help Russia overcome its economic woes. It would be the Russians themselves who alone could decide the right policies but the President made clear that the US expected Russian recovery to be based on political and economic freedoms.

The President's message was delivered as President Yeltsin continued his political battle to get the parliament or Duma to endorse Mr Viktor Chernomyrdin as his choice of Prime Minister. But there are fears that the Communist party and its allies will demand a return to more state control of the economy as the price of their support for Mr Chernomyrdin.

Mr Chernomyrdin was rejected by a large Duma vote on Monday largely due to Communist opposition but Mr Yeltsin has nominated him for a second vote early next week. The Speaker of the Duma, Mr Gennady Seleznyov, said yesterday that Mr Chernomyrdin had "no chance" of getting the necessary majority. The Communist leader, Mr Gennady Zyuganov, yesterday declared that his party and its allies, who constitute a majority in the Duma, will continue to reject Mr Chernomyrdin.

Mr Yeltsin, according to Russian sources, told Mr Clinton that Russia might have to re-impose temporary state controls as the way out of its present financial and economic difficulties which have resulted in a collapse of the rouble on foreign exchanges and a moratorium on debt repayments. US officials refused to confirm this but hinted that there could be more forceful government action in some areas such as enforcing tax collection. The officials re fused to answer questions about the likelihood of the Communist party playing an increased role in a future Russian government and said it was not a question of "ideology" but of a "constructive economic strategy".

The officials also said that so far there was no Russian "plan" for economic recovery which could receive international support.

President Clinton flew into a wet and grey Moscow for the opening of his two-day summit.

He was greeted by Mr Chernomyrdin at the airport and the two men discussed the Russian crisis on their drive to the President's hotel.

Later Mr Clinton had a 90-minute meeting in the Kremlin with Mr Yeltsin whom he hugged affectionately. He found Mr Yeltsin "vigorous and very much engaged", according to Mr Strobe Talbott, the President's chief adviser on Russia.

Later, Mr Clinton addressed students described as "the next generation of Russian leaders" at the Moscow University of International Relations. He told them that in the present crisis "the stakes are enormous" and every choice that Russia makes today "may have consequences for years to come".

He listed four ways for Russia to get out of its crisis without abandoning the free market economy. These are: a fairer collection of taxes; refraining from printing money to bail out the banks and pay bills; no special bail-outs for a privileged few; and fair treatment for creditors if they are to continue lending to Russia.

The summit, while vague on how Russia can emerge from the present economic crisis, produced two agreements on reducing the threat from nuclear materials used in warheads and on an early warning system for missile launches. Under the first, the US and Russia will each remove 50 metric tons of plutonium from their weapons programmes and transform it so that it cannot be used again in warheads.

The second agreement means that both countries will inform each other of the launch of ballistic missiles and space launch vehicles. This will help avert the danger of inadvertent launch of ballistic missiles on the basis of false early warning of attack.

The summit will end today after a further meeting between the two Presidents and a joint press conference.