Click here for the full text.
Department of State
January 2000


U.S. Government Assistance to and Cooperative Activities
with the New Independent States of the Former Soviet Union -
Fiscal Year 1999 Anuual Report



Political [...] Overview


The political atmosphere during FY 1999 was unsettled, due in part to the December 1999 Duma elections and the presidential elections, which were initially scheduled for June 2000, but were moved up to March 2000 as a result of President Yeltsin’s resignation at the end of 1999. Prime Minister Primakov's government was in place from September 1998 to May 1999, with economic policy led by First Deputy Prime Minister Yuriy Maslyukov, a Communist Party leader and former head of the State Planning Committee. In May 1999, President Yeltsin replaced Primakov with then-Interior Minister Sergey Stepashin, who removed most Communist Party members from the government's economic team. In July, President Yeltsin named yet another new prime minister, then-Security Council Secretary Vladimir Putin, who was also quickly confirmed. Prime Minister Putin focused heavily on security issues and largely retained his predecessor's economic team, although many reform-minded officials left the government for the private sector. One constant figure throughout these changes was Viktor Gerashchenko, who has been the president of Russia’s Central Bank since September 1998.

Overview of U.S. Government Assistance

In FY 1999, the U.S. Government provided an estimated $1.99 billion in assistance to Russia, including $167.98 million in FREEDOM Support Act funds, $1.16 billion in U.S. Agriculture Department (USDA) funds (including a concessional loan valued at $522.8 million provided to the Russian Government under USDA’s Food for Progress Program), $389.40 million in U.S. Defense Department (DoD) funds, $236.13 million in U.S. Energy Department (DOE) funds, $17.72 million in other U.S. Government funds, and $19.92 million in DoD excess and privately donated humanitarian commodities. USAID programs accounted for roughly half of the total FREEDOM Support Act-funded assistance provided to Russia in FY 1999 - 
approximately $80.0 million, including $20.0 million for small-business development and micro-credit programs, $12.5 million for health programs, $12.2 million for the elimination of trade impediments, $8.2 million for democratic reform programs, $5.9 million for Eurasia Foundation programs, $6.4 million for environmental programs, $5.9 million for training programs, $4.0 million for partnership programs, $355,000 for energy programs and $5.0 million for other programs. As in FY 1998, FREEDOM Support Act-funded assistance to the Government of Russia continued to be subject to a 50-percent cut mandated by the U.S. Congress.


Democracy Programs

USAID Independent Media Programs: A part of the U.S. Government’s comprehensive response to the challenges posed to Russia’s independent media by the country’s August 1998 financial crisis, USAID significantly broadened its journalism training and media-related business support activities in FY 1999.

· Internews: USAID-funded Internews provided technical assistance to over 300 regional television stations in 81 of Russia’s 89 regions. A new training forum called “Local Time”—a series of regional competitions/seminars in eight of Russia’s time zones plus a final round in Moscow—enabled 30 to 50 stations from each region to compare programming, have access to professional training, broaden their contacts with national network executives, and have access to expert legal advice from the Moscow Media Law and Policy Center, Glasnost Defense Fund and the National Association of Telebroadcasters. Internews also launched a coordinated series of regional media advertising-support activities in 67 cities throughout Russia, resulting in the formation of a National Association of Regional Advertising Agents. In addition, Internews provided production support grants to 27 regional non-state television stations during the period of
sharply decreased media advertising revenues that followed the financial crisis. Internews also launched a newsroom computerization program and an Internet-based news exchange network called “InterNovosti,” and contributed to the establishment of network of media organizations that worked to loosen government controls on local media.

· National Press Institute: Since 1993, the USAID-supported National Press Institute (NPI) and the Media Viability Fund, which is co-financed by USAID and the Soros Foundation, have provided technical support to more than 1,500 regional non-state regional newspapers in over 70 regions of Russia. In May 1999, NPI established a new legal services program to help regional independent newspapers defend their rights and oppose encroachments by local authorities. In FY 1999, NPI conducted over 800 press conferences and professional training events in its seven regional press centers located in Moscow, St. Petersburg, Yekaterinburg, Samara, Vladivostok, Nizhniy Novgorod and Novosibirsk.

USIA Media Programs: In FY 1999, USIA administered and coordinated a number of programs that brought Russian media representatives to the United States on professional development programs. Three cooperative television productions (TV co-ops) provided the opportunity for ten Russian television professionals to travel to the United States and produce high-quality television programming for large Russian viewing audiences on various aspects of American life, including Y2K preparedness, civil-rights protection in a multi-ethnic society, and U.S. television news. A USIA print media program focusing on journalistic ethics brought six journalists from throughout Russia to the United States. The journalists spent three weeks in the United States, meeting with representatives of media, government and civic organizations. Upon returning home, the journalists published articles in their respective papers on their experiences in the United States. USIA also participated in a $10 million independent media initiative launched by Secretary of State Madeleine Albright during her visit to Moscow in January 1999. Under this initiative, USIA brought U.S. speakers in the field of journalism to Russia and organized media internships in the United States for Russian journalists.

USAID Rule-of-Law Programs: In FY 1999, USAID continued to work with the Russian judiciary, with both the commercial (arbitrage) courts and the courts of general jurisdiction. During the last year and a half, over 1,300 Russian judges and court administrators have participated in USAID-funded programs aimed at improving the participants’ understanding of law and judicial ethics, improving court administration, and improving continuing judicial education. USAID’s support for the Russian Supreme Court’s new Judicial Department, the entity now responsible for administering the courts of gen eral jurisdiction, contributed to the improvement of judicial administration in Russia. USAID also fostered partnerships between U.S. and Russian judicial entities, including a partnership between Russia’s Judicial Department and the Administrative Office of the U.S. Courts. A special program involving the Supreme Qualifying Collegium, the Russian judicial-branch entity responsible for enforcing discipline against judges accused of ethics violations, raised awareness of judicial ethics issues among hundreds of judicial leaders from Russia’s regions.

USAID Support for Human-Rights Monitoring: In FY 1999, USAID provided support for a human-rights monitoring program that covers 30 of Russia’s regions and produced human-rights reports for all 30 regions and a report about Russia’s national human-rights situation. Other USAID-funded human-rights programs offered programmatic support and made facilities available to NGOs working on issues such as the rights of minorities, refugees, psychiatric patients, and other groups.

USAID Political Process Programs: In FY 1999, USAID continued to support increased participation by Russian citizens in democratic political processes, with a special emphasis on the December 1999 elections to the State Duma (Russia’s lower house of parliament) and the presidential elections now scheduled for March 2000. The USAID-supported International Republican Institute (IRI) and the National Democratic Institute for International Affairs (NDI) helped democratically oriented Russian political parties strengthen their local party organizations and increase party membership. IRI and NDI trained more than 3,000 political party leaders and civic and political activists in 12 key regions. IRI provided almost $122,000 in subgrants to Russian NGOs whose mission is to promote democratic development. These subgrants supported the training and research programs of four regional NGOs. Through its NGO Advocacy Program, NDI facilitated the formation of a coalition of national civic organizations whose mission is to organize and coordinate election-oriented advocacy activities. The coalition is comprised of seven national civic organizations, all of which have regional affiliates. In addition, through its Moscow office and resource center, the USAID-supported International Foundation for Election Systems (IFES) provided technical assistance to Russia’s Central Election Commission (CEC), 89 subject (regional) election commissions (SECs) and 2,700 territorial election commissions (TECs). During August-September 1999, IFES and the National Press Institute (NPI) conducted a unique series of election-related seminars for media representatives, which gave them a chance to interact with CEC representatives. Six cities hosted these seminars, bringing together SEC members and journalists from a total of more than 35 regions. In FY 1999, USAID also continued to support the educational program of the Moscow School of Political Studies (MSPS), which conducted training and roundtables for approximately 300 Russian politicians and policy-makers in Moscow and in the regions. USAID support enabled MSPS to translate and publish, as part of an MSPS Library series, four Western scholars' books on democratic theory and practice, and on liberal economics. Some 12,000 copies of these books were distributed to the State Duma, presidential administration, governmental institu-tions, universities and libraries.


Security Programs

U.S. Department of Defense (DoD) – Cooperative Threat Reduction (CTR) Program: In June 1999, the U.S. and Russian Governments signed a protocol extending the CTR umbrella agreement, including its original liability protections, tax and customs exemptions, and audit and examination provisions, for another seven years. Despite problems in other areas of U.S.-Russian relations, cooperation on CTR programs continued without disruptions throughout FY 1999. [...] Projects were also initiated to help Russia process and package fissile material in the post-dismantlement stage and to prevent the proliferation of biological weapons expertise and technology.


Social-Sector and Humanitarian Programs

U.S. Department of Agriculture (USDA) – Food Assistance: In FY 1999, USDA provided Russia with 3.7 million metric tons of food assistance, valued at $1.16 billion. The program consisted of approximately 1.7 million metric tons of wheat and wheat flour donated under the P.L. 416 Program, 1.9 million tons of commodities provided under the P.L. 480, Title I Concesssional Sales and Food for Progress Programs, and 100,000 metric tons of various commodities donated as humanitarian assistance and delivered through five U.S. private voluntary organizations (PVOs). Most of the proceeds of the monetized components of this assistance were directed towards the Russian Government's Pension Fund, providing support for elderly pensioners. Proceeds from the seed sales under the Food for Progress Grants Program were used to support credit cooperatives and seed research.


Coordinator’s Office Humanitarian Assistance: Since 1992, the U.S. State Department’s Operation Provide Hope has provided over $602 million in humanitarian assistance to Russia. In FY 1999, the Office of the Coordinator of U.S. Assistance to the NIS expended $1.34 million in transportation and grant funds to deliver $19.92 million in targeted humanitarian assistance to the people of Russia. Much of this assistance was in the form of donated commodities distributed by small and medium-sized U.S. PVOs. However, the majority of this assistance was in the form of high-value pharmaceuticals provided through large PVOs like Project Hope. During FY 1999, the Department of State funded six humanitarian airlifts and 163 surface shipments to Russia.

USAID Health-Care Reform Programs: In FY 1999, USAID designed and began to implement multi-year strategies aimed at specific health problems in Russia, including women’s and infant health, AIDS/HIV prevention, and tuberculosis control. USAID also continued to support U.S.-Russian primary health-care partnerships and facilitated a dialogue at the national level on the quality of health care in Russia.


Preview of FY 2000 Programs

In FY 2000, U.S. Government assistance to Russia will strengthen its regional and grassroots emphases, supporting the development of small business and civil society, as well as health-care reform and environmental activities. USAID will provide technical assistance to Russia’s electoral commissions to help ensure that the presidential elections scheduled for March 2000 are free and fair. USAID-funded initiatives will also reach out to newly elected legislators in the State Duma (parliament) and the regional legislatures, as well as to municipal officials. The U.S. Government will continue to target funds away from the Russian federal government and Moscow, towards Russia’s reform-minded regions. Exchange programs will work to strengthen the valuable partnerships between U.S. and Russian communities and organizations in all sectors and will serve as vehicles to bring more Russians to the West to observe democracy and free market economics first-hand. In Moscow, U.S. Government-funded programs will also continue to address significant obstacles to reform, including corruption, organized crime, and the overall lack of an effective and comprehensive legal system that can ensure the rule of law. USAID will continue to work with other donors to promote banking and tax reform.