B4-0830, 0866 and 0869/98

Resolution on the situation in Russia

The European Parliament,

- having regard to its previous resolutions on the situation in Russia, especially its resolution of 1 April 1998 ((OJ C 138, 4.5.1998, p. 166.)), and its assent of 30 November 1995 to the conclusion of an Agreement on Partnership and Cooperation between the European Communities and their Member States of the one part, and the Russian Federation, of the other part ((OJ C 339, 18.12.1995, p. 45.)) and its assent of 11 June 1997 to the conclusion of a Protocol to the Partnership and Cooperation Agreement between the European Communities and their Member States and the Russian Federation ((OJ C 200, 30.6.1997, p. 66.)),

- having regard to the statement by the Commission on the situation in Russia of 3 September 1998,

- having regard to the outcome of the meeting of the Council of 5 and 6 September 1998 in Salzburg and to the outcome of the meeting of representatives of the G7 of 12 September 1998 in London,

- having regard to the partnership and cooperation agreement between the European Union and the Russian Federation,

A. committed to the reconstruction of Russia and to the promotion of partnership between Russia and the European Union through the partnership and cooperation agreement, and to support for the integration of Russia into European and transatlantic political and security structures such as the Council of Europe, the North Atlantic Cooperation Council, the Partnership for Peace, and into economic and financial structures such as the European Bank for Reconstruction and Development, the International Monetary Fund and the G8,

B. expressing its deep concern about the serious political and economic crisis in the Russian Federation and the severe negative economic and financial consequences that this crisis will have for the standard of living of the Russian people and for the further development of the Russian economy,

C. emphasizing that, although external factors have contributed to its seriousness, this economic and financial crisis has mainly been caused by the Russian authorities¨ continued inability to bring forward far-reaching structural reforms benefiting the general interests of the Russian population,

D. noting with concern that substantial financial and other support measures by the European Union and its Member States, by other states and by international financial institutions have made only a limited contribution to overcoming the structural problems of the Russian economy and to bringing about the necessary process of reform towards a social market economy, due in part to the absence of stable political and administrative structures and the emergence of parallel economies,

E. regretting the failure of successive Russian authorities to deal effectively with the social, financial and economic chaos inherited from the former Soviet Union, by their failure to introduce financial and market reforms designed to devolop a social market economy, against entrenched large manufacturing enterprises whose trade has continued to be effected through untaxable barter arrangements,

F. emphasizing that it is within the responsibility of the Russian authorities to put an end to the present economic crisis,

G. noting that the opaque privatisation process in Russia has concentrated economic capital in the hands of an oligarchy that is creating monopolistic rather than competition-based structures,

H. noting with disquiet the attempt to change the existing institutional equilibrium between the Duma and the President outside the legal norms for constitutional change,

I. emphasizing that a clear and unconditional commitment to full legal, institutional and economic reforms, whilst taking full account of the situation of the ordinary people, should be given by the Russian authorities as a precondition to the further continuation of support to the economic reform programme,

J. expressing its concern that, although the direct negative effects for the European Union and its Member States caused by the economic and financial crisis in the Russian Federation are as yet relatively limited, the global, long-term consequences of a collapse of the Russian economy would be extremely damaging for the situation of the Russian people, for the development of the Russian Federation and the other States of Central and Eastern Europe and for peace and stability on the whole of the European continent,

1. Calls on the President of the Russian Federation, the newly appointed Prime Minister, the State Duma and the Federation Council to establish a stable government that will give full priority to overcoming the structural problems of the Russian economy and to bringing about the necessary process of legal, institutional and economic reform towards a social market economy;

2. Considers it essential that a state structure which functions throughout the country and is needed for the functioning of a social market economy should be established and also that national and federal structures should be strengthened;

3. Calls furthermore on the President and the incoming government of the Russian Federation, the State Duma and the Federation Council to reinforce these reforms towards a social market economy, of which social and environmental conditions are an integral part, in order to restore confidence in the economic development of the Russian Federation;

4. Stresses that these reforms must come from within Russia itself and that further financial assistance should be granted to Russia on condition that real economic and legal reforms are implemented in Russia, whilst taking into account the situation of the ordinary people;

5. Stresses that in this framework priority should be given to the restructuring of the Russian Federation¨s public finances, and in particular the system of tax collection, the restructuring of the financial and banking sector, the promotion of SMEs, institutional reforms at local and federal level and modernisation of public administration;

6. Invites the Russian authorities furthermore to create a positive climate for foreign and domestic investment through the implementation of an appropriate legal framework, including transparent tax and investment protection legislation, combating corruption and organised crime, and effective administrative and infrastructural frameworks for these purposes;

7. Believes that the estimated USD 150 billion in bank accounts held by Russian citizens within and outside Russia must be used for investments in Russia, and to this end calls for examination of an amnesty in regard to the provenance of these funds;

8. Urges the Commission and the Council to make full use of the forthcoming review of the TACIS programme to take full account of the pressing need for economic and institutional reform in the Russian Federation;

9. Proposes that the Commission in conjunction with NGOs should examine the possible need to supply during the forthcoming winter food and medicines and if appropriate to make the necessary preparations to this end;

10. Stresses the importance of maintaining and developing further the cooperative partnership in security matters that is gradually being established between Russia and the West;

11. Calls on the Council and the Commission to further strengthen measures for the achievement of democratic reforms and civil society and to promote understanding of democracy through programmes by independent institutions and the development of country-wide democratic party political structures;

12. Calls on the Commission and the Council to submit proposals to the next meeting of the G7, such that similar efforts can be made by and coordinated with other G7 members, in particular with the United States of America;

13. Instructs its President to forward this resolution to the Commission, the Council, the President, the Government and the parliamentary institutions of the Russian Federation, the IMF and the World Bank.