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. Last Updated: 07/27/2016

The Lessons of Halifax

President Boris Yeltsin's participation in last month's summit of the Group of Seven leading industrialized nations in Halifax has produced a stormy debate in Russian political circles concerning both the significance of the meeting's results for Russia's interests and the prospects for Russia's future in this prestigious international forum. The fact that Yeltsin's trip coincided with the Budyonnovsk hostage crisis and the ensuing no-confidence vote in the State Duma has made this debate even more heated.

While the government is inclined to exaggerate the scope of Halifax's results, its opponents have ignored the summit's most important point: The fact that the Chechen conflict has considerably complicated Moscow's foreign-policy position makes the dialogue with the G-7 all the more important for Russia.

We must face the fact that opportunities for economic and political cooperation between Russia and the EU are presently quite limited. Moreover, delays in implementing the Agreement on Partnership and Cooperation Between Russia and the EU are fraught with the possibility of new demands to renegotiate a number of important articles that were agreed upon long ago.

Further, Russia's entry into the Council of Europe has been indefinitely suspended. The United Nations has been thrown into a state of crisis concerning its peacekeeping operations. It is also appropriate to note the distinct cooling of Russia's relations with NATO that would ensue if, as many analysts predict, some definite decision on expansion is forthcoming in the next few months. In this context, the G-7 forum is becoming an ever more important channel between Russia and the West.

For Russia, the most important use of this channel is in resolving questions about the country's foreign debt, which is becoming an increasingly painful problem. At present, Russia's debt stands at about $120 billion. The obligation to repay these debts places a tremendous burden on the Russian economy and on the budget. In the 1995 budget, $6.4 billion was allocated for debt payments.

Russia has therefore sought a 25-year restructuring of its foreign debt, and this proposal was an important topic of discussion in Halifax. In fact, according to statements from Russian politicians, an agreement to extend the payment period for Russian debts was "nearly reached." This, however, is most likely something of an exaggeration, since no commitments or even guidelines on this matter are contained in any of the summit documents.

Moreover, any final decision on this question will not be made until the next meeting of the Paris Club in the fall. Also, even if something like the Russian proposal is accepted, it will not be sufficient to ease the burden on Russia's economy. The time has come for even more radical measures.

The first is that Russia must be admitted as a full member of the Paris Club. Russia has, after all, granted billions of dollars in credits to develop the economies of other nations, especially those in the CIS. Incomplete figures indicate that outstanding debt to Russia stands at not less than $80 billion.

Second, at least part of Russia's debts should be written off altogether. After all, there are precedents for this, the most relevant of which is Poland.

Third, Russia must be admitted into the major international trading bodies, especially the World Trade Organization. Russia should be offered full membership in the Organization for Economic Cooperation and Development.

Unfortunately, instead of such decisive measures, Western leaders in Halifax limited themselves to mere promises of future cooperation, and the experience of recent years shows clearly that such promises are likely to take years to be realized, if they are ever fulfilled at all.

There is one more point to emphasize in considering the Halifax meeting. Before the latest G-7 summit, Russia's role at such meetings had been extremely limited: Russian leaders merely reported on the domestic political situation, summarized the results of the country's political and economic transformation and outlined Moscow's views on the most pressing international problems.

Now, however, there is no justification for such a passive role. Of course, considering Russia's weak economic position, it would be unrealistic to expect that it would be granted a decisive role in the resolution of major economic problems such as global unemployment or the restructuring of the International Monetary Fund.

Consequently, it is logical to seek some sort of "compensation" in the spheres of politics and international security, where Russia rightly has a much larger role than G-7 members such as Italy or Canada. This is why, for example, Russia presented the G-7 with its initiative to host a special G-7 meeting in Moscow next spring devoted to nuclear security issues. This initiative was approved and, what is more, several Western leaders including French President Jacques Chirac expressed a willingness to participate in such a conference personally.

Of course, the significance of this success should not be exaggerated and Russia should not harbor false illusions. The G-7 forum is as likely to become a place for airing crucial foreign-policy differences as it is for reaching agreements. In Halifax, for instance, much discussion was devoted to disagreements concerning NATO expansion and regulating the conflict in the former Yugoslavia.

Finally, the West has tried -- and will continue to try -- to closely control the extent of Russia's participation in "the big seven," seeking to define that participation in terms of its own interests. However, Moscow must seek out any opportunity to exploit foreign-policy openings in order to strengthen Russia's position and influence. Doing so will have a direct impact on resolving matters that are hindering economic development and holding down standards of living for average Russians.

Pavel Podlesny is a senior analyst at the Russian Academy of Sciences' Institute of Europe and a consultant at the YuKOS Institute. He contributed this comment to The Moscow Times.