At APEC Russia and the U.S. look east
US Secretary of State Hillary Clinton attends the Asia-Pacific Economic Cooperation (APEC) summit in Russia's far eastern port city Vladivostok on September 8, 2012. Asia-Pacific leaders meet for annual trade talks, hoping to present a united front amid a gloomy world economy but with team spirit frayed by worsening territorial rows.
September 8th, 2012
08:21 AM ET

At APEC Russia and the U.S. look east

From CNN Foreign Affairs Correspondent Jill Dougherty

Vladivostok, the site of this year’s Asia-Pacific Economic Cooperation forum, is more than 5,000 miles from Moscow, seven times zones to the east. The word means “Ruler of the East” and the Russian government wants to make good on the promise of that name.

“When the decision was made that we would hold the chairmanship several years ago we thought that it would give a general boost to the whole region of Far East Russia,” says Mikhail Kalugin, Acting Head of Economic Section at the Russian Embassy in Washington.

The Kremlin poured more than $20 billion into transforming Vladivostok for the summit. “Not just renovating the venue where this summit will be held,” Kalugin says, “but we’ve invested lots of money in our infrastructure, in the city of Vladivostok and the Primorsky Krai region, including a new airport terminal, a railway from airport to the city, major improvements to the city infrastructure, new bridges, including bridge to Russky Island where the summit will be held.”

“For Russia it’s a very important decision to put more weight in our efforts in Asia-Pacific because, historically, economically and demographically and politically Russia has been a European nation and most of our trade is with the European Union and the major population centers are in the European part of Russia,” the Russian Embassy’s Senior Counselor, Alexey Y. Drobinin says. “So it’s a tremendously important decision for us to boost our presence in Asia-Pacific and to engage more actively in integration efforts there.”

Drobinin points out that, just three months ago, Prime Minister Dmitry Medvedev created a new ministry in the government for the development of Russia’s Far East.

Moscow also is hoping the APEC summit will jump-start investment in Russia, especially now that it has joined the World Trade Organization.

"The main result will be how much investment Russia will receive after the meeting and how the other economies will be ready to accept Russian investment," First Deputy Prime Minister Igor Shuvalov told reporters before the summit began.

U.S. Secretary of State Hillary Clinton congratulated Russia on joining the WTO and said it could pay off big for Moscow.

“The World Bank, for example, estimates that by effectively implementing its WTO commitments, Russia could increase its gross domestic product by about 3 percent in the medium term, and as much as 11 percent over the long run,” she said. “So it pays to join the rules-based global trading system. And Russia’s trading partners stand to benefit as well. We believe American exports to Russia could double or even triple.”

The State Department is working closely with Congress to end the Cold-War-era Jackson-Vanik amendment and grant Russia Permanent Normalized Trade Relations. Clinton said she is hoping Congress will pass the legislation this month.

The Jackson-Vanik amendment was passed in 1974 as a way of pressuring Russia to allow Soviet Jews to emigrate. With the collapse of the Soviet Union, that was no longer an issue, but legislators kept the amendment on the books to pressure Russia on other issues.

The United States has waived it every year since 1994, but it still violates World Trade Organization rules requiring members of the body to give one another permanent normal trade relations.

Russia finally entered the WTO this summer, raising the stakes for the United States to end a measure that critics warn could end up costing it business.

For the United States, too, APEC is crucial for economic growth. “APEC’s 21-member economies comprise nearly three billion consumers,” a senior State Department official told reporters traveling with Clinton. “They account for 44 percent of world trade. They represent 56 percent of the global economic output. That was $39 trillion in 2011, and six of America’s ten largest trading partners are in APEC.”

That’s a key factor in President Barack Obama’s “pivot” to Asia. “After an extended period in which the United States had to focus a great deal of attention and resources on regions and conflicts elsewhere,” Clinton said at the summit, “we are now making substantially increased investments in the Asia-Pacific.”

Obama set a goal of doubling U.S. exports worldwide by the end of 2014 and Clinton cited what she called “great gains in APEC.”

Between 2009 and 2011 U.S. exports to other APEC economies increased by nearly 45%, she said, and they’re up another 7.5% in the first half of 2012.

“But we can still go further. American companies are eager to invest more in Asia. And when they confront unfair regulations, or if they just want advice on local customs, they come to us at the State Department. And we go to bat for them.”

The U.S. and Russia, both Pacific powers, are looking East. As Clinton told the leaders gathering in Vladivostok: “Our growing economic interdependence is part of why I often say that much of the history of the 21st century will be written in Asia.”

soundoff (30 Responses)
  1. Vidyashanti

    Russia, China and others are using US to be on their feet. Our greed is making our CEOs to mortgage this countries future by transferring technology & jobs abroad. In a way this is a signal to slow down and stop all aids to the countries who are not appreciative.

    September 20, 2012 at 8:55 am | Reply
  2. Joseph E. Espindola

    Ariticle contradicts itself.First article says Russia boots out USAID then states that Russia & US to look eat!
    http://www.cnn.com/2012/09/19/world/europe/russia-usaid-expulsion/index.html?hpt=hp_bn2

    September 19, 2012 at 11:51 am | Reply
  3. OffTheWorldPolitics

    Putin is off flying with birds. He does not care about helping the U.S. at all..

    September 10, 2012 at 4:35 pm | Reply
  4. krm1007 ©™

    Smart of Hillary and Putin to look East. Here is why......

    Time has arrived to focus on India. The American invasion of Afghanistan brought to the forefront the irrelevance of India as a nation. With a population of over 1.2 billion people there was no value that this nation could bring to the table. Their soldiers (ragtag) 1.2 million continue hiding in the trenches scared from Talibans. A few teenage Talibans invaded the country and held it hostage for days on end showing how useless India is. It was embarrasing for the world to observe this humiliation of a nation that was being touted as a regional power.
    I continue to read with interest the thesis presented on CNN that "less is more" in a political context as applied to India. Although Mies Van Der Rohe adopted this in an architectural context, its economic and political connotations are indeed powerful. Empowering subjugated minorities in India by splitting it into smaller states would trigger uber economic demand for western nations who have given so much financial and technology aid to India with no return to show for the investment. I concur with this approach and with an economic background find the premise to be on solid footing. Central Asian States (CAS) are a case in point on this successful approach. We need to understand that India has an unmanageable large population mired in poverty and we are spinning our wheels trying to feed it. It is also too big of a geographical unit to govern. Again, we saw how a few teenage talibans were able to invade it with a few BB guns. And that says a lot... in a negative way not only for a large unmanageable country like India but also for USA which is trying to prop it up against China. Besides, Americans cannot afford to look like losers in the midst of a terror war which has lasted for over ten years now.

    September 9, 2012 at 6:12 pm | Reply
    • Abby

      good post !

      September 10, 2012 at 10:08 am | Reply
  5. 66th Strategic Command & Operations Unit.

    U.S trading with the RU sounds like a decent deal.

    September 9, 2012 at 2:55 am | Reply
    • George Patton

      I agree as long as Russia does not cave into the demands of Hilary Clinton and her right-wing henchmen in Washington! These people in Washington want to be dominant everywhere these days and the Far East is no exception!!!

      September 9, 2012 at 8:55 am | Reply
  6. diane

    I'll try to comment again and see if you include it...where is the real story about the US being rebuffed by our *partner* Russia for not engaging with Iran and Syria? Guess Romney has this part of foreign policy down a little better than Obama. Is this why the Israel/God platforms were dropped and added back by the Democrats? America detests lies by omission CNN. If you're *the world leader in news*, let's see the truth. Now.

    September 8, 2012 at 11:17 pm | Reply
    • :)

      If elected, Rommels foreign "policy" will give the neocons and chickenhawks all the wars to their black hearts content.

      September 9, 2012 at 4:16 pm | Reply
    • OffTheWorldPolitics

      It's getting too close to election time for that kind of publicity. Its time to focus on all the beneficial scenarios that may result form this debacle they call a foreign policy, regardless of how unlikely they may be. Russia does not want Marlboro, and Jack Daniels, they want oil profits from increased conflict.

      September 9, 2012 at 8:11 pm | Reply
  7. Mohammad A Dar

    To learn reason behind mayhem among humanity please visit http://www.limitisthetruth.com/blog.html

    September 8, 2012 at 12:36 pm | Reply

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