VZCZCXRO3269
PP RUEHDBU RUEHLN RUEHVK RUEHYG
DE RUEHMO #3803/01 1011356
ZNR UUUUU ZZH
P 111356Z APR 06 ZDS
FM AMEMBASSY MOSCOW
TO RUEHC/SECSTATE WASHDC PRIORITY 3976
INFO RUCNCIS/CIS COLLECTIVE
RUEHXD/MOSCOW POLITICAL COLLECTIVE
RUEHLN/AMCONSUL ST PETERSBURG 2794
RUEHVK/AMCONSUL VLADIVOSTOK 1322
RUEHYG/AMCONSUL YEKATERINBURG 1528

UNCLAS SECTION 01 OF 02 MOSCOW 003803 
 
SIPDIS 
 
C O R R E C T E D  C O P Y - ADDED CODEL CAPTION 
 
CODEL 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PGOV PHUM PREL KDEM ECON EATO KHIV RS
SUBJECT: CODEL FRIST MEETING WITH RUSSIAN EXPERTS 
 
 
MOSCOW 00003803  001.4 OF 002 
 
 
¶1. (SBU) SUMMARY.  In an April 10 breakfast meeting with 
Codel Frist and the Ambassador, Russian experts described the 
range of challenges facing Russia in the political, economic, 
and social sphere.  Experts agreed that high oil profits 
disincline the political leadership to push new policy 
initiatives.  They claimed that Russian foreign policy is not 
anti-Western, but rather is on an independent trajectory. 
They described positive economic developments, with a strong 
banking sector and strong cash flow, and noted social 
challenges that include the need for a new approach to 
immigration and greater technical assistance in the health 
sector.  END SUMMARY. 
 
¶2. (SBU) Senate Majority Leader Bill Frist (R-TN) and 
Senators Judd Gregg (R-NH) and Richard Burr (R-NC), 
accompanied by Ambassador Burns, met on April 10 with a group 
of Russian experts, which included Dr. Aleksey Bobrik of the 
Globus Consortium; Sergey Riabokobylko, a real estate 
entrepreneur active in the American Chamber of Commerce and 
co-founder of Stiles and Riabokobylko real estate firm; 
Andrey Kortunov of the Eurasia Foundation; Boris Makarenko of 
the Center for Political Technologies; Anatoliy Vishnevskiy 
of the Center for Demography and Human Ecology; and Dmitriy 
Trenin of the Moscow Carnegie Center. 
 
POLITICAL MOOD 
-------------- 
 
¶3. (SBU) Considering internal political developments, Russia 
was not moving forward, according to Makarenko.  High oil 
profits allowed the political elite to "sit on the top and 
enjoy" and reinforced a lack of initiative to introduce 
change.  This resulted in a political system that wasn't 
being properly exercised.  Kortunov agreed that oil money was 
a major obstacle to structural reform in Russia as it allowed 
the government to continue to offer social benefits, assuring 
political loyalty.  Despite this, Makarenko believed that 
market forces and increased openness to the outside world 
would continue to grow and eventually become dominant. 
 
¶4. (SBU) According to Makarenko, the most active voters in 
Russia were retirees, and political leaders were particularly 
attentive to this group.  But pensioners had still not 
adjusted to reforms introduced in the 1990s.  Young people 
were worrisome, in that they gave significant support to 
leaders such as nationalist political leader Vladimir 
Zhirinovskiy.  While Zhirinovskiy marketed himself as a 
liberal-democrat, he was neither liberal nor a democrat.  His 
ability to attract support demonstrated that he was a 
talented politician.  Once elected, however, he didn't follow 
through on his promises, instead cooperating with the 
government.  Middle-aged Russians were largely struggling to 
survive in a changing economy and sought stability. 
Makarenko predicted more rational political behavior in the 
long-term, but admitted that "things might get worse before 
they get better." 
 
RUSSIA'S FOREIGN POLICY 
----------------------- 
 
¶5. (SBU) While Russia was facing internal challenges, it was 
also encountering a change in its relations with the rest of 
the world, the experts underscored.  Trenin said the early 
1990s brought to Russia a new openness to the outside world, 
after a long period of self-containment.  Initially, Russia 
had followed the Western trajectory, but in the last several 
years it had gone its own way in the hopes of creating its 
own "solar system."  According to Trenin, Russia's foreign 
policy was neither anti-Western nor motivated by a desire to 
recreate the USSR, but rather reflected the expansion of 
Russia's economic interests and cultural commonalities in the 
post-Soviet space.  Russia's partners needed to take 
seriously Russia's desire to carve out a niche for itself. 
Trenin added that as Russia continued on its independent 
trajectory, it would move closer to China, making China's 
influence equal to that of the U.S. 
 
¶6. (SBU) Echoing Trenin's assertion that Russia's intent in 
the post-Soviet space was not driven by imperialist motives, 
Kortunov warned that the real challenge for the West derived 
from the growing feelings of arrogance and isolationism 
displayed by the Kremlin.  The Kremlin was not worried about 
what the West thought of it and knew that it could not be 
ignored in the world community.  Kortunov emphasized that it 
was important for the U.S. to encourage openness and 
engagement in its approach to Russia.  One way that the U.S. 
could engage Russia more effectively was to move from the old 
model of technical assistance toward a more reciprocal model, 
 
MOSCOW 00003803  002.4 OF 002 
 
 
with Russia sharing its expertise with the U.S. in areas such 
as emergency disaster response.  According to Kortunov, it 
was important to strengthen the social dimension in the 
U.S.-Russia relationship. 
 
ECONOMIC ISSUES 
--------------- 
 
¶7. (SBU) While Russia's political mood was mixed, economic 
development seemed headed in a more positive direction. 
Riabokobylko described Russia's main challenge in the 
economic area as decreasing citizens' dependence on the 
government for stability of income.  Riabokobylko observed 
that businessmen were increasingly in power in Russia's 
regions and seemed sincerely interested in developing 
infrastructure and raising living standards in their cities. 
The banking sector in Russia was doing well and could be a 
catalyst for infrastructure development.  Russian-owned banks 
like AlfaBank could even compete with international banks 
like Citibank. 
 
¶8. (SBU) While corruption existed in Russia, Riabokobylko 
argued, it was possible to do business without paying bribes. 
 Favoritism due to local relationships existed, but was 
hardly unique to Russia.  The main challenge for businesses 
in Russia was to change outside perceptions of Russia as 
corrupt and focus on its more positive economic developments. 
 
DEMOGRAPHIC CONCERNS 
-------------------- 
 
¶9. (SBU) On the demographic front, Vishnevskiy explained that 
Russia needed a new approach to immigration.  Currently most 
immigrants came to Russia from Russian-speaking regions of 
the post-Soviet space, but Russia needed more diversity in 
its immigration.  Unfortunately, Russian society was not 
ready for this; public opinion was hostile to increasing 
immigration due to the absence of previous experience with 
immigration.  Vishnevskiy said that lack of good legislation 
to control the migration stream complicated the situation. 
It would be helpful for the U.S. and Russia to share 
experiences on immigration. 
 
HIV/AIDS 
-------- 
 
¶10. (SBU) Bobrik agreed that more cooperation between the 
U.S. and Russia in the health field was possible.  Despite 
the influx of money in the health sector, there was still a 
lack of experience in the field and, according to Bobrik, the 
GOR would be receptive to more U.S. technical assistance in 
this area.  Cooperation could also increase regarding vaccine 
development.  Some cooperation already existed through grants 
and university exchanges, but the lack of English-speakers in 
the health and science sector limited cooperation in this 
area. 
BURNS