BREACHING a constitution, whether it is faulty or not, could make
solid economic sense. President Boris Yeltsin must think so as he
surveys the international reaction to his suspension of the Russian
parliament and the parallel call for new elections.
Diplomatic support was forthcoming almost immediately. All of the
major nations spoke out in favour of Yeltsin with the proviso that the
promised democratic elections must be just that.
In most cases Yeltsin would have expected foreign political support,
especially as there are hints of some nodding and winking at higher
levels with the intention of warning the major allies of what was about
to happen.
If this is true, some appear not to have got the message, including,
it is believed, the United States where Clinton administration Russia
expert Strobe Talbot was to be found briefing a Congressional hearing on
Tuesday in utter ignorance of the events unfolding in Moscow.
However, the hard fact is that diplomatic support will be of little
use within Russia, and quite hopeless in converting Yeltsin's opponents,
most of whom have been muttering darkly for months that he is already in
the pocket of foreigners.
Economic support is quite a different matter. One date which has been
nagging at Yeltsin's mind for some time is the October 1 deadline set by
the International Monetary Fund for the unveiling of some evidence that
economic reform was making headway.
Until this week the IMF deadline would have been an uncomfortable one
for Yeltsin. It is true that the economic situation of Russia is not as
bad as it was a year ago when the rouble was in free-fall and many
Russians feared the arrival of a hungry winter.
The rouble is a good deal steadier now, though by last night it was in
relapse once more and close to the all-time low reached last June. Yet
although there has been greater stability in recent months the pace of
reform has hardly been impressive.
Before the events of this week, there was doubt as to whether the
latest $l.5 billion tranche of aid under the Systematic Transformation
Facility would be disbursed in full.
An earlier disbursement of $1.5 billion has already been used up by
Moscow, but agreement on the current sum, and progress in constructing a
stand-by loan which would carry stronger economic target conditions, is
a prerequisite for the rescheduling of $15 billion of Russia's foreign
debt. The new disbursement is now expected to go ahead.
It is clear that the relative calm in Moscow yesterday, and President
Yeltsin's clever move in appointing the arch-reformer Yegor Gaidar as
acting economics minister in addition to his apointment last week as
first deputy prime minister, has cheered those in charge of economic aid
for Russia.
Gaidar told a news conference yesterday that his priorities would be
to avoid hyper-inflation, the removal of unnecessary state controls and
further decentralisation of the economy.
He coupled this with a warning that communists might seek to influence
the forthcoming parliamentary elections by playing on economic hardships
and political disorder, but even this sombre point was not enough to
deflect supporters abroad.
This was most evident in the United States where Clinton
administration figures were mounting a campaign yesterday to ensure
Congressional support for the latest economic aid package.
There were a few dissident voices raised, including that of the
influential Senator Richard Lugar who clearly felt that pouring further
aid into a confused situation was a sure way of wasting money.
The consensus, though, was that the best way to support Yeltsin was by
ensuring further aid and the Americans and other allies are expected to
ensure now that this is exactly what happens.
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