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. Last Updated: 07/27/2016

Economic Crisis Casts Shadow on Bonn Visit




President Boris Yeltsin will take a posse of ministers to Bonn on Monday for an unprecedented round table with German counterparts, but the history of the occasion has quickly evaporated in the heat roasting Russia's financial system.


The Kremlin has insisted that "consultations" -- Germany's formula for top-level talks with major allies -- amount to a feather in the cap for Russia, cementing its position as one of Bonn's key international partners.


But now Yeltsin is likely to arrive in Bonn cap in hand, after a month of market freefall and investor panic which has left the Russian currency anemic from a hemorrhage of capital and confidence.


Ministers from the Group of Seven leading industrial nations are due to discuss the emergency package in Paris on Tuesday, but Yeltsin has already dispatched his top economic aide, Alexander Livshits, to Frankfurt for talks with bankers and Finance Ministry officials.


Behind all the economic urgency is an end-of-era political subplot. Yeltsin and German Chancellor Helmut Kohl, fellow giants of post-Soviet European transformation, could be shaking hands as world leaders for the last time.


"Yeltsin understands that with elections coming up in Germany this could be his last chance to draw on his close contacts with Kohl," said Valery Mazing, a foreign policy expert with the USA-Canada Institute.


Kohl's Christian Democratic Union currently trails in opinion polls for the Sept. 27 legislative elections.


Yeltsin underscored his friendship with Kohl by a message of condolence Thursday following the train crash in Germany that left at least 100 dead.


But with Kohl's star apparently on the wane, Yeltsin has hedged his bets by scheduling talks with the German leader's rival, Social Democrat candidate Gerhard Schr?der,while he is in Bonn.


Yeltsin will need to show diplomatic dexterity to sidestep the most sensitive issue dividing the two countries -- Moscow's refusal to return to Germany cultural treasures looted during World War II.


The Kremlin chief has pledged to hand the war booty back to Germany, despite a State Duma law forbidding the return of the law.


The Kremlin is to take the issue up with the Constitutional Court, but Russia's ambassador in Germany, Sergei Krylov, warned recently that the return of cultural treasures was a "bilateral process."


"One should not forget why this problem arose. Although over 50 years have passed since the end of World War II, thousands of masterpieces which we lost in those times have not been returned to Russia," Krylov was quoted by Itar-Tass as saying.


Mazing said the issue had put Yeltsin in a delicate situation, and the best he could hope for would be to avoid the issue altogether.


Yeltsin's entourage will include key members of his new young economic team, as well as some older hands such as Foreign Minister Yevgeny Primakov and Defense Minister Igor Sergeyev.


Sergeyev's presence in the lineup could hint at further military cooperation accords, analysts said. "Germany helped Moscow as it withdrew its troops from Germany in the last days of the Soviet Union, and similar help would be extremely important, particularly the program to retrain former officers and build homes for soldiers," Trenin said.