Russia after the Global Economic Crisis

On Thursday June 10, 2010, The Peterson Institute for International Economics hosted the U.S. book launch for Russia after the Global Economic Crisis. This book was co-edited by Ǻnders Aslund, Senior Fellow of the Peterson Institute for International Economics, Sergei Guriev, Rector of the New Economic School in Moscow, and Andrew Kuchins, Director and Senior Fellow of the Russia & Eurasia Program at the Center for Strategic & International Studies.

Dr. Michael A. McFaul, Senior Director of the National Security Council offered the keynote address on U.S.-Russia relations to provide a current platform for the new book.  The panel included Hon. Stephen Sestanovich from the Council for Foreign Relations and Columbia University and Leon Aron from the American Enterprise Institute.  C. Fred Bergsten moderated the luncheon.

Dr. McFaul praised the book and its authors and discussed the “reset” theory in U.S.-Russian relations. Since 2008, relations between the two countries have steadily improved thanks in large part to efforts from the Obama administration and the architects of the “reset” strategy. In this connection, the Obama administration proposed greater emphasis on the shared interests of Russia and the U.S. as a way to reinforce U.S. strategy on other key areas, such as Iran, Afghanistan, and nuclear arms reductions.  To accomplish these goals, it is critical for both the United States and Russia to avoid linking past problems, like the conflict in Georgia, with current mechanisms that can foster a sustainable partnership for the future.

Dr. Aron offered his perspective on Russia’s foreign policy decisions, giving particular attention to the notions of nuclear superpowers, regional superpowers and global powers.  However, Dr. Aron underlined that Moscow and Washington have different priorities on each of these positions, and consequently there is room for ideological interpretations and potential setbacks.

Dr. Kuchins commented on the reset strategy as “successful beyond expectations.”  He underlined a major contradiction in Russian foreign policy specifically that Russia’s economic goals, as represented by the 2020 Strategy, require close work with the West and Japan, members of NATO, which Russia identifies as a major threat to its security.  Therefore, resolving this contradiction will be the way forward for Russia’s economic stability.

Dr. Aslund commented on Russian structural problems, specifically state corruption, as the reason for their eight percent decline in GDP.  He said that this can be addressed if Russia commits to engaging with the West, stating that NATO accession is a possible game changer.

Dr. McFaul concluded the panel discussion with an observation that Putin and the Russian elites recognize that economic reform is the precondition of investment into Russia, and everyone is in agreement.