From Volume 36, Issue 41 of EIR Online, Published Oct. 23, 2009
Russia and the CIS News Digest

China, Russia Work on Rail, Nuclear, Space Projects

Oct. 13 (EIRNS)—Chinese Prime Minister Wen Jiabao and visiting Russian Prime Minister Vladimir Putin signed a joint communiqué and oversaw a series of economic and other agreements in Beijing today. These include agreements for cooperation to supply China with oil over 20 years, and a framework for natural gas exports to China; a memorandum of understanding among the Russian Ministry of Transport, the Chinese Ministry of Railways, and Russian Railways on "organizing and developing high-speed rail service on the territory of the Russian Federation"; an agreement to build the second stage of the Tianwan nuclear power plant in Lianyungang; and a Space Cooperation Program for 2010-12. This program includes a Russian spacecraft carrying China's first Mars probe to the moon Phobos; it was originally going to be launched this Autumn, but has been postponed until 2011. Putin emphasized the importance of their "Large-Scale Plan" for investment cooperation, and a plan for regional development of Russia's Far East, Siberia, and northeast China.

The two nations also agreed to inform each other about any launches of ballistic missiles and carrier rockets, and to set up a direct Presidential telephone line.

Wen said this was a "crucial year," for efforts to overcome the world financial crisis, and that the two leaders had a comprehensive exchange of views on key issues. They will try to optimize trade, and agreed they need "appropriate cooperation on major projects in the oil, gas, and nuclear power sectors, and that we need to strengthen cooperation in the space, aviation, transport and telecommunications sectors," Wen said.

China's Global Times reported Oct. 11 that Putin "wants a high-speed rail system," and wants China to help build it. In the 1950s, the Soviet Union had helped China build railways, Zhou Shijian, senior researcher at the Institute of Sino-U.S. Relations at Tsinghua University, told Global Times. "Now, it's our turn to help them build railways," Zhou said. China has developed trains which can travel at 350 kph, and a new train that can run on both normal and special high-speed track.

An Oct. 12 article in the Russian business daily Vedomosti announced that a comprehensive "Russia-China 2018 Cooperation Program," for building 205 joint projects in the Russian Far East, west Siberia and northeast China, was approved by Russian President Dmitri Medvedev and Chinese President Hu Jintao in New York Sept. 23. The article was datelined Vladivostok, where Putin stopped on his way to Beijing. There, he announced that construction of new infrastructure to ready the city for the 2012 APEC summit, was making Vladivostok Russia's "Pacific Gate," and was creating tens of thousands of jobs.

Putin Visit to China Opens New Phase of Economic Cooperation

Oct. 17 (EIRNS)—A senior U.S. intelligence source yesterday underscored the importance of Prime Minister Putin's recent visit to Vladivostok and China. More significant than any of the specific agreements signed, he said, was the decision, worked out between the prime minister and President Dmitri Medvedev prior to the trip, to open up Russia to Chinese investments on a new basis. For the first time, according to the source, the Russians will allow the Chinese to have a direct equity stake, and, in some cases, ownership, of companies in Russia. This goes beyond long-term contracts to purchase energy and raw materials, which have characterized Russian-Chinese deals in the past.

Lyndon LaRouche commented that this is not only an important bilateral development; it also means that China's U.S. dollar reserves are now worth something real, because they are being invested in infrastructure and other physical production. LaRouche added that if the new Russia-China economic cooperation, on this new scale, goes forward, it creates the opportunity for the United States to join in the arrangements, advancing the Four Powers (U.S.A., Russia, China, India) prospects. LaRouche mentioned his recent speech during the economic panel of the Rhodes conference (see EIR InDepth), where he emphasized the development of northeast Russia, with its vast raw materials wealth. These kinds of projects will naturally draw immediate support from Japan and South Korea.

Lavrov, Clinton Discuss 'Strategic Dialogue' in Moscow

Oct. 13 (EIRNS)—Russian Foreign Minister Sergei Lavrov and visiting U.S. Secretary of State Hillary Clinton today emphasized progress in relations, in their joint press conference, after their meeting as heads of the Bilateral Presidential Commission of the two countries. Lavrov said they had made "considerable progress" in discussing conditions for a new Strategic Arms Reduction Treaty, and Clinton said that the U.S. is "very interested in working with Russia to develop cooperation on missile defense," including "joint threat assessment." Clinton also met President Dmitri Medvedev.

Clinton summed up her assessment of the "reset" of relations, saying that while the two nations have disagreements, "we are planting those disagreements in a much broader field of cooperation, and hopefully, we are enriching the earth in which this cooperation can take root."

Lavrov also struck a positive note, saying that "our sides have expressed readiness to develop strategic dialogue in all spheres." He said that the Russian and U.S. positions on Iran's nuclear program "coincide." "We are not asking for anything from each other on the Iran issue, because it would be ridiculous to ask for anything in an issue on which our positions coincide," he said. Clinton said that Russia has been "extremely cooperative" on the Iranian nuclear issue, and said that "we have not come to that point," where additional sanctions would be inevitable. Lavrov was emphatic that sanctions are "counterproductive," saying that Russia's "position is that at this stage all efforts should be made to support the negotiating process. Sanctions and the threat of pressure in the current situation are counterproductive."

Lavrov also said that Russia is awaiting an invitation from NATO to participate in talks on Afghanistan. He told the press that on Oct. 7, a U.S. military cargo plane had conducted a test transit flight over Russian territory to Afghanistan, another step towards final implementation of the two nations' Agreement on Military Transit to Afghanistan. The two ministers discussed cooperation against narco-terrorism, on restarting talks with North Korea on its nuclear program, and on Israel-Palestine.

Yakunin: LaRouche's Warnings Were Crucial for Russian Railways

Oct. 18 (EIRNS)—Vladimir Yakunin, CEO of the state-owned company Russian Railways and a long-time associate of Prime Minister Vladimir Putin, said in an Oct. 16 interview with the Baltic Information Agency (BaltInfo), that American economist Lyndon LaRouche's warnings of a systemic global crisis prepared him and his company for what has happened during the past three years.

Yakunin was asked, "How does Russian Railways view the world crisis—as an annoying event, or as an incentive to make bold decisions and an economic and technological breakthrough?" He replied: "In 2006, already, the American economist Lyndon LaRouche, who uses non-traditional systems in analyzing the economic situation, warned that the crisis had already begun. Few people listened to him, but we were among those few. Now we are trying to keep our hand on the pulse. Last year Russian Railways set up an anti-crisis committee, which monitors the situation in the carriage market and inside our company on a daily basis."

One year ago already, in an Oct. 2, 2008, interview in the business daily Kommersant, Yakunin said he had known of the coming crisis years in advance, because of the warning he received from LaRouche. In February of this year, Yakunin took the same message to a conference at the London School of Economics, where he named LaRouche as the "very rare" economist who predicted the collapse of the world financial bubble.

Yakunin is co-founder of the World Public Forum Dialogue of Civilizations, known as the Rhodes Forum. LaRouche and his wife, Schiller Institute founder Helga Zepp-LaRouche, were speakers at the 7th annual Rhodes Forum, held Oct. 8-12.

In his BaltInfo interview, Yakunin said that Russian Railways' top priority today is to "save the investment program." He emphasized that the second stage of the Russian government's Strategy for the Development of Rail Transport in the Russian Federation to 2030, covering the period 2016-30, "provides for rapid expansion of the rail network and the creation of infrastructure conditions for the development of new economic growth spots in the country, while achieving world-class levels of technological development in rail." As detailed in EIR of Sept. 7, 2007, the Strategy includes stretches of high-speed rail in key areas of European Russia, Siberia, and the Far East; strategic freight lines, oriented to Siberian resource development for domestic use as well as export; and a line to Russia's coast on the Bering Strait, facing Alaska, location of a potential multi-purpose tunnel connection to the United States and all of the Americas.

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