- The Washington Times - Wednesday, December 11, 2013

Russia wants to set aside tensions with the U.S. and forge the first bilateral trade and investment treaty between the former Cold War rivals.

Russian Deputy Prime Minister Igor I. Shuvalov met with U.S. Trade Representative Michael B. Froman on Wednesday to propose a treaty like the trade pacts that govern U.S. business ties with South Korea, Colombia and other nations.

Senior Russian officials portray the proposal as the fulfillment of pledges both nations have made to deepen trade relations when Russia joined the World Trade Organization two years ago — an event that has failed to significantly boost trade between the nations. In fact, U.S.-Russian trade has stayed flat at about $40 billion a year despite Moscow’s efforts to open Russian markets and engage more in business with the rest of the world.

“I would like to see more normalcy in our relations. Twenty years after the end of the Cold War, what is missing is normalcy,” one Russian official said at a background briefing for reporters Wednesday in Washington.

The official acknowledged that tensions increased this year over, among other matters, Russia’s granting of asylum to Edward Snowden, a former National Security Agency contractor who leaked government secrets.

But such disagreements shouldn’t derail commerce, the Russian official said. “Don’t you have disagreements with Europe?” he asked, noting that France often voices sharp criticisms of the U.S. before Russia does, but that hasn’t prevented the U.S. from having extensive trade ties with France.

The official said U.S. officials were caught off guard and “surprised” by the proposal but were open to pursuing it.

Mr. Froman has not commented publicly on his meeting with Mr. Shuvalov. But the Obama administration has vowed to try to double U.S. exports and stepped up its engagement in World Trade Organization negotiations and major trans-Pacific and trans-Atlantic trade talks this year, suggesting it would support a deepening of trade with Russia.

The U.S. runs a small trade deficit with Russia as a result of importing about $2.5 billion a month of titanium, steel and other products while exporting about $1 billion a year of goods.

Russian officials at the briefing said a bilateral investment agreement could be signed as soon as next year and a broader trade deal could be forged within five years.

With China cultivating trade ties with Russia and other nations in the region, it’s in U.S. interests to be equally engaged, the Russians said.

“We are an immediate neighbor to the U.S.” said one official, noting that the Russian far east abuts Alaska. “We would like to develop our far east,” but “don’t feel safe” doing so exclusively with China, said the official. “Every day we have something additional with China but not with the Americans. It’s dangerous.”

Russia and the U.S. have proved they could work together in forging an agreement to eliminate Syria’s chemical weapons, said the other official, and the U.S. and Russia already cooperate in such areas as space travel and exploration.

“This is the model” the two nations should follow in liberalizing trade, he said.

American businesses already are keen to invest and trade more with Russia, and are showing less concern about Russia’s sometime arbitrary tax and legal systems, the officials said.

Russia in the past decade spooked many businesses by nationalizing the Yukos oil company and imprisoning its chief executive, Mikhail Khodorkovsky, on tax charges. From time to time, other Western and Russian businessmen have accused the government of arbitrary and capricious acts, particularly toward those perceived as political opponents of Russian President Vladimir Putin.

“Ten years ago, our tax office was an office full of crooks,” but that is no longer the case, one official said.

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