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Senior Democrat Calls For Normalisation Of US-Russia Trade Relations

by Tatiana Smolenskaya, Tax-News.com, Moscow

26 February 2007


Rep. Tom Lantos (D- Calif) is spearheading US efforts to remove a legislative barrier to normal trade relations between the United States and Russia which he says is a moribund relic from the Cold War era.

During his official visit to Moscow last week in his capacity as Chairman of the Foreign Affairs Committee, Lantos told Russian lawmakers that he would urge his fellow Congressmen in Washington D.C. to scrap the 1974 Jackson-Vanik amendment, which links trade with human rights records in communist and former communist countries.

"It's time to put behind us this relic of the Cold War," Lanos told a news conference. "I will spare no effort to bring this about and I have every expectation that I will be successful."

One of the central aspects of the Jackson-Vanik amendment is the insistence that communists states allow freedom of emigration to their citizens, particularly jewish sections of the population, but Russia insists that all restrictions on emigration were effectively abolished when the Communist government fell in 1991.

While US Congress have enacted a waiver to grant Russia normal trade status on a year-by-year basis since 1994, its failure to repeal the Jackson-Vanik amendment has continued to anger the Russian government, especially since Washington has normalised trade relations with many ex-communist states. The continued existence of the amendment could also complicate Russia's bid to join the World Trade Organisation later this year.

"The initiative by Tom Lantos comes as a very timely and right political move," Konstantin Kosachev, head of the international relations committee of the lower house of the Russian parliament, the State Duma commented last week, according to CNSNews.

Lantos however, remains a harsh critic of Russia's human rights record, and has spoken out on the trip about the controversial imprisonment of Mikhail Khodorkovsky, the former boss of defunct oil company Yukos, on charges of tax evasion, fraud and embezzlement. Calling Khodorkovsky a "political prisoner," Lantos said the Yukos affair continues to cast a "shadow over the reputation of Russia."

It is widely believed that the government campaign against Yukos, which itself was slapped with fines of almost $30 billion for tax evasion, not only helped silence Khodorkovsky, a critic of the regime of President Putin, but also helped the government exert greater control over the energy sector. Yukos's remaining assets are due to be auctioned off next month, and state-owned oil and gas concerns are likely to snap up its largest facilities.

However, many analysts and observers believe that such policies have severely dented the confidence in Russia of foreign investors and businesses. Indeed, last month, Lantos said that the decision by the Federal Supreme Court of Russia to let the government close the headquarters of one of the country's few remaining independent human rights organizations, the Russian Chechen Friendship Society, demonstrates that Russia "lacks even a modicum of the rule of law."


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