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The U.S. secretary of commerce has highlighted disturbing trends in the economy and press freedom in Russia
The U.S. secretary of commerce has highlighted disturbing trends in the economy and press freedom in Russia, which he said can affect economic growth and the investment climate in the country. Speaking at the U.S.-Russia Business Council, which represents over 300 American companies working in Russia, in New York Wednesday, Carlos M. Gutierrez also emphasized Washington's commitment to resolving issues hampering Russia's accession to the World Trade Organization. Gutierrez said American companies have complained of a "soft nationalization" taking place in some sectors of Russia's economy, which challenges the economic and political successes Russia has made since the collapse of Communism. "American companies are anxious to invest in Russia, but many remain hesitant to do so," Guitierrez said. "Some have invested tens of millions in a production facility only to be faced with a competitor backed with preferences in the form of government ownership or capital," he said without elaborating further. This stifles competition and hurts Russia's reputation, and could ultimately thwart efforts to create a dynamic economy, he said. The Russian government has moved to regain control of crucial hydrocarbon assets privatized in murky deals in the 1990s. The controversial affair involving Yukos, once Russia's largest independent oil company but now in bankruptcy proceedings, has been particularly criticized in the West. The company's core production unit, Yuganskneftergaz, was acquired by state-controlled Rosneft. Russian authorities are now mounting pressure on the vast hydrocarbon projects led by foreign companies in Russia's Far East, citing major environmental and other violations. And Russia's energy giant Gazprom made a surprise announcement this week that it will develop the giant Shtokman gas deposit in the Barents Sea on its own, leaving behind the U.S.' Chevron and ConocoPhillips, as well as other companies earlier on a shortlist of contenders for the project. State-owned Gazprom also said it will redirect main gas deliveries from the deposit, earlier destined for the United States, to Europe. The moves are widely believed in the West to have affected Russia's investment climate. Among further challenges to the country's progress, Guitierrez pointed to the murder of a senior Russian Central Bank official, who contributed to improving the Russian financial system, and of an outspoken journalist in Moscow. Journalist Anna Politkovskaya, 48, known for her staunch criticism of the Kremlin, its military campaign in Chechnya, and current Kremlin-backed Chechen authorities, was gunned down in Moscow last Saturday. Gutierrez said the killings of journalists should concern the Russian government if it recognizes the value of transparency for Russia's economic future. Russian Ambassador to the United States Yury Ushakov told the Council that Russia's top prosecutor has taken the investigation into Politkovskaya's murder under his control, and has promised to spare no effort to find and punish those behind the killing. Andrei Kozlov, 41, who oversaw bank licensing and led the Central Bank's efforts to close down dozens of banks for violations of banking legislation, particularly on money laundering, died September 14 after being shot the day before. "He was a Russian patriot, and he was a reliable, respected and honest public servant," Gutierrez said, adding that Russia must stem violence against public officials. Another banker - the director of a Moscow branch of Russia's state-owned foreign trade bank, Vneshtorgbank - was shot dead in Moscow late Tuesday in an alleged contract killing. Addressing the sensitive WTO issue, which is believed to have influenced Russia's Shtokman-related decisions, Gutierrez said Washington was seeking a bilateral agreement that is commercially sound. "Agricultural safety and the protection of intellectual property rights are two areas we are working hardest to resolve," Gutierrez said, pointing to the world's highest-volume online seller of pirated music, allofmp3.com Web site, which continues to operate in Russia. Veterinary control of agricultural products and violations of intellectual property rights have been major stumbling blocks during Russia's bilateral WTO talks with the U.S. Talks broke down in July over a U.S. demand that Russian authorities issue certificates for American meat imports without prior safety checks. But Russia's Ushakov shifted part of the blame for the failure to achieve brisker economic cooperation on Washington, saying Congress and the media have been carried away with criticism of some of Moscow's policies and have not noticed the positive aspects in bilateral relations. The diplomat also said the Jackson-Vanik amendment, which restricted trade with the former Soviet Union, remains in force for Russia. He echoed President Vladimir Putin's earlier remarks that Russia is still subject to prejudice experienced by the former Soviet Union.
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