- The Washington Times - Monday, July 24, 2000

OKINAWA, Japan European leaders said yesterday that the Group of Eight agreed to share the cost of any Middle East peace agreement and would work toward including Russia as a full member of the rich nations' club.
President Clinton made no mention of either possibility before leaving the annual economic summit a few hours early so he could return to the peace negotiations between the Palestinians and Israel at Camp David.
But in news conferences after Mr. Clinton left, European leaders divulged aspects of their discussions that are bound to prove controversial in the United States.
Senate Majority Leader Trent Lott of Mississippi has said Republicans will not agree to foot any of the $40 billion in refugee resettlement funds that the Palestinians are demanding.
Politicians from both parties view Russia's transition from a communist-controlled state to a free-market economy as far from complete.
"We didn't mention any numbers, but we made a shared commitment to devote funds to the Middle East, specifically toward refugees," said Italian Prime Minister Giuliano Amato.
Mr. Amato said the group, at his suggestion, agreed unanimously to accelerate Russia's integration into the Group of Eight apparently after being impressed by the smooth performance of newly elected Russian President Vladimir Putin at his first summit.
Russia currently sits in on only noneconomic discussions involving security and political affairs. Economic matters continue to be controlled by the Group of Seven, which comprises the world's largest industrial economies the United States, Germany, Japan, France, Italy, England and Canada.
In terms of size and sophistication, Russia's economy would not even rank among the top 10 in the world. Because its economy is still in transition from state control, Russia has not joined the World Trade Organization, which sets the rules of global commerce.
But European leaders appeared to be suggesting that Russia's bid to join the WTO will be accelerated with its rise within the G-8.
"This was a summit of the full integration of Russia. This was determined in part by the confident but not exaggerated performance of Vladimir Putin," said German Chancellor Gerhard Schroeder. "That is, for me, the most prominent result of the summit."
Like other European leaders, Mr. Schroeder was struck by Mr. Putin's deft handling of foreign policy and security issues, calling the Russian leader's account of his landmark visit to North Korea only days before the summit "brilliant."
European leaders, who share Mr. Putin's opposition to a national missile defense system Mr. Clinton is considering deploying next year, were pleased that he put the United States on the defensive on the issue.
Mr. Clinton has cited North Korea's program to develop ballistic missiles as a principal reason for going ahead with the Star Wars-like missile defense system. But at a face-to-face meeting with Mr. Clinton on Friday, Mr. Putin conveyed an offer by North Korea to stop developing missiles in exchange for access to peacetime space technology.
Mr. Schroeder, the main booster of Russia among European leaders, said that because of Russia's rank among nations, the G-7 leaders should not forgive part of Russia's $42 billion in debt a measure Mr. Putin reportedly wants but declined to bring up at the summit.
"Russia is neither a developing country nor an emerging country, but a world power," Mr. Schroeder said. Russia owes more money to Germany than to any other nation.
After falling into a financial crisis that shook the world in 1998, Russia's economy revived in the last year with a jump in the price of crude oil its chief export. But most analysts say the country is far from enjoying the solid growth and prosperity known in the West. Russia is still considered one of the troubled patients of the International Monetary Fund and is the West's biggest debtor.
Romano Prodi, head of the European Union, also called for upgrading Mr. Putin's status. Most participants agreed that the businesslike Russian leader made a far greater contribution to discussions than his erratic predecessor, former President Boris Yeltsin.
"Before, he was more a guest and a protagonist. Now, he's one of the eight," Mr. Prodi said.
Mr. Amato said the Group of Eight left out any mention of Russia's debt problems in its final communique yesterday at Mr. Putin's request.
"When in the next few years you write a book on the passage from G-7 to G-8, you will be able to say the transition process started" in Okinawa, Mr. Amato said.
Not all G-8 leaders agreed that any decision was made on making Russia a full member of the club, and Mr. Putin himself appeared to have more modest goals.
Russia wants to be included in discussions only where decisions affecting the country are made, Mr. Putin said. "Russia will work with the G-8, and we are prepared to expand our participation," he said.
Canadian Prime Minister Jean Chretien denied that any decision was made concerning Russia, though he described Mr. Putin as "eloquent and very knowledgeable."
"Did the G-7 become a G-8? That is definitely not the case," he said. "They do not participate in the first meetings" involving world economic matters, he said.
British Prime Minister Tony Blair also made no mention of a decision to elevate Russia within the group, though aides said he was "very impressed" with the new leader. Mr. Putin stressed his commitment to free-market economic reforms in his talks with the other leaders.

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