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Office of the Press Secretary

                       BACKGROUND BRIEFING

                          July 9, 1993

                        The Briefing Room

7:42 P.M. (L)

MR. GERGEN: [name deleted] is here to talk ON BACKGROUND and give you an update on the rest of the session this afternoon, and the President will be over shortly. Thank you.

SENIOR ADMINISTRATION OFFICIAL: I thought that I would try to be helpful in giving you some sense of what went on in the G-7 plus one session this afternoon. I will offer some color insofar as I was able to pick up a little bit during the brief time that I was there, and I've also got some of my colleagues' notes on the substance of the discussion.

Let me just say, by way of introducing that, that the rules of these events is that we are not to quote or to characterize with attribution what any of the leaders say, except for our own. So I will be in a position to tell you a little bit about what President Clinton had to say in the course of this afternoon's session, but I'll only be able to talk in fairly general terms about what everybody else had to say.

One thing I'm sure that any of you who were in the pool or who were around the palace noticed is that the Russian tricolored flag had been added to the stand of flags of the seven. There were two flags on either side at the very end just before you arrived at the palace.

The eight leaders sat around a circular table, and there were separate tables behind them, staffed on the whole by their sherpas. I would point out that in the case of the Russian delegation, seated right behind President Yeltsin was Boris Fyodorov, the Russian Minister of Finance. He has been absolutely key to the reform process, has been extremely important in discussions that have been going on between the United States government and the Russian government. He's one of the principal architects of the Russian reform program.

You may recall that he was -- today's meeting was really the culmination of a six-month process that has been hosted by the Japanese going back to the meeting of the deputies -- Finance Ministry deputies, I believe, in Hong Kong back in March. And Boris Fyodorov was invited to that meeting.

He and Foreign Minister Kozyrev attended the joint finance and foreign ministerial meeting that was held here in Tokyo in mid-April, and there he was again today, seated right behind President Yeltsin, and from time to time, passing President Yeltsin notes with points on which President Yeltsin would then elaborate in his comments.

The format was the following: Prime Minister Miyazawa opened the session and then called upon President Clinton to make some remarks about the global political situation. And I can go into a bit of detail on what President Clinton had to say. He began after, of course, thanking Prime Minister Miyazawa for hosting the meeting, praising President Yeltsin's leadership and vision for reshaping Russian foreign policy. Remember that the topic of this part of the meeting was politics; the economics came later.

He made the point that because of the success that President Yeltsin has already had in his reform program, Russia has already moved quite a bit towards what is clearly everybody's goal, and that is that it be a full-fledged member of the Community of Nations represented by the G-7 itself. And President Clinton said the following in that regard:

He said, "The growing cooperation between the G-7 and Russia, in contrast to the situation that characterized past summits when the Soviet Union was an object of concern and a source of conflict is one of the most important things about this meeting. Russia is now in many ways a bridge between the European and Asian flanks of the G-7. And that makes up a possible closer political and economic cooperation throughout the world."

He also said a little bit about Russian foreign policy and said that Russia was now, in general, a force for peaceful solutions to ethnic and political problems. He cited the cooperation between Russia and the other members of the G-7 in a variety of areas -- Somalia, Angola, Cambodia. He talked about how Russia had been a partner of the United States and the other Security Council members in the United Nations in the search for a solution to Bosnia and how Russia had been working closely with the United States and other G-7 countries trying to resolve the problem of the North Korean nuclear program. He stressed that it's especially important that Russia and the G-7 work effectively to curb proliferation and strengthen export controls and transform COCOM.

I might just mention parenthetically that at the Vancouver meeting, President Yeltsin had put great stress on wanting to put behind us a number of international arrangements as well as pieces of American legislation which he characterized as legacies of the Cold War and which he told President Yeltsin back in Vancouver he found offensive to him as the leader of a democratic Russia. And in that context, President Yeltsin had stressed particularly COCOM. And the Clinton administration is looking for some way to develop a successor organization to COCOM in the future.

President Clinton then continued to solicit from President Yeltsin his views on a variety of specific problem areas in the former Soviet Union. He cited specifically Georgia, which, of course, has been particularly on people's minds recently. And he urged that there be increased cooperation between Russia and the G-7 to find solutions to various problems, political problems around the periphery of the old USSR. In this connection, he cited specifically the issues of Ukraine and the Baltic States.

In his concluding remarks, President Clinton addressed himself to the question of relations between Russia and Japan. And in that regard, he said that he assumed that all of the leaders present believed that a democratic Russia is in the interest of the entire world, and that's why all were there today to support Russian reform.

He went on to say at the same time: "It is essential for Russia to take its place as a full member of the Community of Democratic Nations, which means continuation of a foreign policy in a spirit of cooperation on a global basis. That, in turn, means a foreign policy based on the principles of international law and justice, and it means putting behind us the troublesome legacies of the past. The full normalization of relations between Russia and Japan clearly would be an important step in that direction." That was pretty much the end of his opening intervention.

In the course of the discussion that followed, it was largely a matter of the other leaders, and that means primarily the other six. President Clinton did not intervene that frequently during the course of the afternoon. He basically gave the other leaders present a chance to ask Boris Yeltsin questions, and that's what they did. They raised questions about a couple of the points that President Clinton had brought up. A number stressed their concern about Georgia, a number stressed their concern about Ukraine.

The mood of the session -- which, by the way, ran from almost exactly 3:00 p.m. until 5:40 p.m. -- was quite informal and quite free-form. There was, of course, simultaneous translation so that nobody had to wait for consecutive translation. I would say it became informal rather quickly. Any initial uncertainty about a format melted away, and within an hour of the beginning, a number of the leaders were referring to the President of Russia as "Boris."

About an hour and a half into the proceedings, the subject turned to the Russian economy. And that consisted almost exclusively of the leaders asking President Yeltsin about his plans in specific areas of reform. There was a very special interest in what the Russian government intended to do to make Russia more hospitable to foreign trade and investment, and particularly in the energy sector.

A number of the leaders opened their questions to President Yeltsin by recounting difficulties that companies in those countries had had trying to do business in Russia. President Yeltsin was extremely well informed and confident and responsive in replying to these questions.

He was also questioned quite closely on a couple of occasions about his plans for constitutional reform. He was asked about what he saw as the chances for a new constitution before the end of this year, the chances for new elections. And on the whole, I think it's fair to say that the leaders found his answers fairly reassuring.

He, on a couple of occasions in the course of the discussion, cited the United States for the leadership position that it's taken in putting together a number of the facilities and programs that have been announced here this week, as well as those back in mid-April. And he, towards the end of the discussion, cited particularly when there was a general discussion about energy and trade and investment, his gratitude to President Clinton for the Clinton administration's decision to put forward a $2-billion Export-Import Bank facility for oil and gas.

Perhaps if there are any -- Helen.

Q The President sounds like he's about to sponsor to Russia as a G-8 member.

SENIOR ADMINISTRATION OFFICIAL: I wouldn't put it that way, Helen. I think that there was an understanding, certainly by the end of the session, that President Yeltsin would certainly be invited to attend next year's meeting in Italy. But the implication, the sense that one had was that this would still be the format of a G-7 plus one rather than a G-8.

Q Did Yeltsin bring anything new to the summit that you hadn't heard before? Did he come with something -- some request of the other nations that you hadn't heard, or did he have some new bit of information about the reform or economic conditions? Or was it all what we've heard in the last couple of weeks?

SENIOR ADMINISTRATION OFFICIAL: No, he did have new information in a couple of areas. He provided some figures which I think will be of use and interest, not only to the leaders who were listening to him, but to the governments in analyzing in a couple of areas. First of all, specifics on his economic policy, what he plans to do to continue bringing inflation down and to bringing the emission of credits under control. He had some new information on what Russia is doing to implement the Start agreements. While he didn't have any new blockbuster requests for specific economic reform support programs, he used the occasion to stress those that he attaches particular importance to.

Q What are some of the new numbers that you heard?

SENIOR ADMINISTRATION OFFICIAL: I can't get into the specifics.

Q Why shouldn't Yeltsin be part of the G-8? What reasons argue against it?

SENIOR ADMINISTRATION OFFICIAL: The issue was not engaged in those terms. I mean, there was no discussion of debate. It was simply the feeling of the meeting that this was a very useful thing for the G-7 to be doing. Certainly, President Yeltsin made clear in the way he conducted his part of the dialogue that he was glad to be there and that this would continue.

Q What arguments are there against them if you could recapitulate?

SENIOR ADMINISTRATION OFFICIAL: There weren't any arguments to recapitulate against it.

Q I don't mean at this meeting; I mean, would the Americans argue against it?

SENIOR ADMINISTRATION OFFICIAL: The issue in those terms really hasn't come up. What was important to President Yeltsin -- and he and his government made this very clear in advance -- is that he be treated here not as a supplicant, not as the head of a basket case country that was coming here with hat in hand.

In fact, several Russian leaders, during the preparatory period for this, cited the example of President Gorbachev's attendance of the G-7 meeting in London in 1991 as an example that they did not want to see repeated. And they stressed two things that they wanted to see out of this.

First of all, that Yeltsin be treated with respect and be given credit for having taken Russia across a threshold in the past several months. And, second, that the G-7 show a willingness and ability to deliver on the commitments they had already made.

And I think that clearly happened, and President Yeltsin expressed his gratitude for that in several ways and several points during the discussion.

Q Did Japan and the Kurile Islands come up?

SENIOR ADMINISTRATION OFFICIAL: I made a point of reading to you verbatim what President Clinton had to say on the subject of relations between Japan and Russia. He was not completely extemporizing. The words were obviously very carefully chosen, and that was pretty much the only thing that was said on the subject.

END 7:58 P.M. (L)