House of Commons - Foreign Affairs

Select Committee on Foreign Affairs Third Report

IV. ACHIEVING THE UK'S OBJECTIVES IN THE BILATERAL CONTEXT

102. As well as acting multilaterally in its relations with Russia, the British Government has an important bilateral relationship. In multilateral forums, the United Kingdom is only one of many voices, and may not be able to achieve the policy ends it sees as desirable, or may have to agree compromises. The bilateral relationship is, however, one for which the Untied Kingdom alone is responsible. We now examine a number of key areas of that relationship: assistance to Russia; our diplomatic effort; the work of the British Council and the BBC, and bilateral contacts in the field of education and at the parliamentary level. First we examine Russian perceptions of the United Kingdom, contrasting them with Russian perceptions of the USA, Germany and France.

Russia's view of the United Kingdom

103. In the spring and summer of 1999 the British Council surveyed the perceptions of the United Kingdom in several countries, including Russia, and produced a report entitled "Through other eyes: how the world sees the United Kingdom."[262] According to this survey, Russians believe themselves to be well informed about the United Kingdom (compared to their knowledge of Germany, France and Japan), and they have a favourable impression of the United Kingdom (more favourable than their impression of Germany, Japan and the US, but less so than their impression of France). They have a positive view of the British education system,[263] but, comparatively speaking, not of British companies.[264] Russians view the United Kingdom as a highly traditional society,[265] something they see as both its main strength[266] and its main weakness.[267] Only 48 per cent believed that the United Kingdom valued its relationship with Russia, one of the lowest of those countries surveyed.[268] There are of course strong historical links between Russia and the United Kingdom, but there is also a history of confrontation in the nineteenth and twentieth centuries, and mutual suspicion resulting from this confrontation. Dr Pravda argued that "Britain attracts respect rather than deep affection in Russia. The British are seen as professional and reliable, if a little cool and detached."[269]

104. Professor Light told us that the United Kingdom "is perceived as being far closer to the United States than as being a member of the European Union."[270] This may be true of the political class—and we were told by a number of politicians during our visit to Russia that they believed that United Kingdom's relationship with the US was too close—but the British Council survey found that 89 per cent of Russians surveyed believe that the United Kingdom values its relationship with Europe, while 88 per cent believed that the United Kingdom valued its relationship with the US.[271] Three times as many Russians have an unfavourable view of the US as they do of Germany,[272] suggesting that, as Professor Light went on to argue,[273] there could indeed be some risk for the United Kingdom as being seen as too strongly associated with US policies. On the other hand, the issue of the United Kingdom's relations with the USA and the EU has many more dimensions beyond their effect on our relationship with Russia. Dr Pravda argued that "there are two countries which Russia takes seriously: the United States is one and Germany the other."[274] For comparison with the UK's relationship with Russia, we now examine Russia's relationship with the USA, Germany, and France.

Bilateral relationships of other countries

105. Russia naturally attaches great importance to its relations with the USA—as we discuss elsewhere, the US is the leading voice in NATO and the international financial institutions and is the most important interlocutor in arms control. Indeed, Professor Stephen White of Glasgow University informed us that "NATO is identified at a popular and élite level almost exclusively with the United States" and that as a consequence, during the Kosovo crisis, "there had been anti-American demonstrations across the country after the bombings had begun, and attacks on the offices of American firms."[275] Professor Archie Brown argues that in financial policy towards Russia "British ministers and officials" welcomed the "Washington consensus (which included the Bush administration, the Clinton Administration, the IMF and, until recently, Congress)."[276]

106. Anatol Lieven argues that in its relationship with Russia, the US has made "symbolic gestures of partnership" including membership of the G8, and the Russia-NATO PJC, while adopting a policy close to containment, building up Ukraine as a buffer against Russia, and speaking of "rolling back" Russian influence in the Caucasus and Central Asia. He argues that this policy is "fuelled by the traditionally anti-Russian attitudes of various former Russian subject nations whose descendants are now United States citizens."[277]

107. For Russia, Germany represents both an historic enemy and a model of a wealthy and stable society, without the extremes of wealth and poverty of the USA. Germany has a much larger trade relationship with Russia than the United Kingdom (see Table 1), both because of the success of German exporters, and because Germany imports most of its natural gas from Russia. Germany is also "owed more than $20 billion by the Russian Government."[278] (For comparison, the United Kingdom's sovereign debt is $2.2 billion)[279]. Much of Germany's debt dates from German unification, because, according to Sir Rodric Braithwaite, "the West Germans knew that the Russians held the key to the reunification of their country....encouraged by Chancellor Kohl, German banks lent Yeltsin large sums of money to support economic reform."[280] In addition, the German government export agency has been generous in its provision of export credits. This accumulation of debt from 1989 until the financial collapse of August 1998 means that, according to Mr Riley of Fitch-IBCA rating agency, "the Germans will be extremely important when it comes to decisions as to whether, for example, Russia should receive debt reduction..."[281] In the light of Russia's financial situation, the German taxpayer has paid a heavy price for this influence.

108. France is a country which in many ways is an analogue of the United Kingdom in terms of its population, wealth, and diplomatic position. France's trade relationship with Russia is somewhat smaller than that of the United Kingdom (see Table 1). As noted above,[282] Russians have a positive view of France, but France does not have Germany's interdependence with Russia, either financially or in terms of energy imports. France has traditionally been concerned about the risks of Russia and Germany developing too close and exclusive a relationship: to this end in March 1998, the German, French and Russian Heads of Government held a trilateral summit. This format has not been repeated since then, with former President Yeltsin's ill-health precluding regular summits of any sort, although, at the Istanbul OSCE Summit in November 1999, he held out the prospect of a trilateral summit on 21 December in Paris. In the climate created by Chechnya, and the impending hand-over of power by President Yeltsin, this meeting did not in fact take place, and it remains to be seen whether the new Russian administration will see it as a useful format.

The Know How Fund

109. Direct British financial assistance to Russia, amounting to £30 million each year over the last three years, has come from the Department for International Development (DFID) and its Know How Fund (KHF). The priority areas for assistance for the KHF were set out in a memorandum from the FCO, which also provided helpful illustrations of projects being financed in each of these areas.[283] The first priority is the promotion of good government, human rights and free, independent and responsible media. In the economic sphere, KHF projects are used to stimulate enterprise development, to help reform public finance and to sustain rural livelihoods. There are projects in health and social services, and in environmental assistance. A further new priority area has been in assisting Russian accession to the World Trade Organisation (WTO).

110. These are all areas where a great deal can be done, and, though £30 million per annum will only scratch the surface of need, aid which is well targeted can have a disproportionately high return. To take three examples: according to the Government, KHF funded advice to the tuberculosis service in Tomsk has changed the method of treatment there and has succeeded in persuading the Federal Health Ministry to use Tomsk as a model for reform elsewhere. In a quite different field, DFID support for the Investment Support Centre has enhanced the quality of investment proposals by Russian enterprises and has generated $50 million in investment.[284] Finally, the KHF contributes to the Russian President's Management Training Initiative—under which 500 young Russia managers will be trained in best Western business practice in the United Kingdom under KHF auspices.[285] The initiative was commended by a number of political leaders whom we met during our visit to Russia.

111. The FCO told us that the KHF had "built a strong reputation in Russia for pragmatism, expertise and speed of response."[286] Certainly the evidence we received was generally supportive of the type of work done by the KHF. The British Council outlined a number of schemes which it administered for the Fund.[287] The CBI described KHF as "very effective".[288] Dr Pravda referred to the United Kingdom's good track record in areas of technical assistance, describing the KHF as "quite lean and effective"[289], while Ursula Owen, of Index on Censorship, contrasted the efficacy of the KHF with the rather more cumbersome and bureaucratic TACIS programme.[290] This was a point also made by Professor Hanson.[291] There were criticisms. John Thornhill pointed out that there was much more that could be done.[292] Sir Michael Alexander believed that money had been wasted by the KHF (and other funding schemes) in the past because of poor targeting and lack of tight control,[293] while Dr Rebecca Kay of Birmingham University warned of some of the dangers of "cultural imperialism" in donor projects from foreign governments.[294] The Russo-British Chamber of Commerce cited the example of a Scottish company dissatisfied with the treatment it had received from the KHF.[295] Recommendations on the method of operation of the KHF are not for this Committee but for our colleagues on the International Development Committee. However, it is understandable if some projects the Fund supports will be more successful than others. No doubt some mistakes have been made. But on balance KHF assistance to Russia amounts to a set of examples of what Sir Rodric Braithwaite characterised as the "whole lot of rather boring small policy initiatives"[296] which bear fruit in our bilateral relationship. Cumulatively KHF assistance will help Russia develop as a European partner of the United Kingdom, and that is an important foreign policy objective. There is certainly a case for increasing the level of assistance: as Dr Pravda said, it "could be slightly less lean and be increasingly effective."[297]

112. As the Foreign Secretary put it, "anything we are funding in Russia we are funding because it is in our mutual interests to fund it."[298] Interestingly, he twice cited health projects as ways in which practical assistance from the United Kingdom could bring political advantages. If the expertise of the National Health Service can be channelled to help eradicate tuberculosis, for example, this would be "a meaningful way" to relate to the lives of ordinary Russians, and so "to try and tackle at the root that growing sense of alienation to the West and the outside world".[299] This multiplier effect of the KHF assistance is most important. At its best, the KHF gives important practical assistance to Russians which can be replicated throughout the country and which pays substantial political dividends for the United Kingdom. As we have argued earlier, the KHF is also a more effective mechanism for delivering help than the EU's TACIS programme has so far been.[300] We support the continued use of the Know How Fund to support Russia, and recommend that the FCO stress to the Department for International Development the political importance of continued substantial funding of Russian programmes.

Good governance

113. As we said at the beginning of this report, the FCO's principal goals in its policy towards Russia are to develop political stability and democracy and a stable market economy.[301] These goals are dependent in large measure on improvements in the system of governance in Russia. Good governance encompasses a variety of features, including fully functioning tax and banking systems, efficient public administration, responsive delivery of public services, respect for vibrant independent media, adherence to pluralist democratic values and the rule of law, a strong NGO sector and the elimination of corruption. A number of projects funded by the KHF in this area were described to us, ranging from strengthening the capacity of the judicial system to act fairly, efficiently and effectively to supporting a St Petersburg edition of The Big Issue and assisting the International Centre for Accounting Reform to introduce open and transparent accounting methods in Russia.[302] We support the FCO and DFID's efforts to offer bilateral help in developing good governance in Russia. We deal in more detail in the paragraphs which follow with good governance in the key areas of human rights and suppression of criminality. However, it is important to emphasise the scale of the task to be performed if standards of governance throughout Russia and its regions are to be brought up to European norms. The United Kingdom has enormous wealth in terms of professional expertise which could be drawn upon to give practical assistance to Russia in a whole variety of areas which could be termed 'good governance'. We met several individuals during our visit to Russia who were helping Russian colleagues at this practical level. We recommend that the Government establish a Good Governance Programme to co-ordinate and extend practical assistance at practitioner level from the United Kingdom to Russia.

HUMAN RIGHTS

114. We have described earlier the concerns which the United Kingdom has about aspects of human rights compliance in Russia.[303] Multilateral approaches on the major areas of concern, whether through the Council of Europe on the abolition of the death penalty or the OSCE on electoral practice, can be complemented by bilateral action by the British Government. On some occasions, the United Kingdom can also lead a multilateral approach, as it has done by instigating EU action in the cases of the environmental activists prosecuted for releasing information on the nuclear fleet or the growth in anti-semitism in Russia.[304] Mr Bowring emphasised the powerful position which the United Kingdom potentially occupies to promote human rights. This flowed, in his view, from "the strong emphasis in British foreign and international development policy on the protection and promotion of human rights, and more important still, the clear recognition of the key importance of social and economic rights, mutually complementing and re-enforcing the more traditional civil and political rights."[305] One complication in human rights work in the international arena is that different countries have their own traditions. Russia is no exception. Mr Bowring told us that the Russians find the different traditions of the European Union to be confusing, and recommended that the United Kingdom see working in Russia as "not simply a question of bringing our knowledge and experience as something ready-made to the Russians; it is engaging with the Russians."[306]

115. The FCO told us that the Embassy in Moscow "co-ordinates KHF, FCO and British Council activities in a programme of events and assistance worth around £650,000 in 1998."[307] Some of the projects are funded by the FCO's own Human Rights Project Fund (HRPF) and many of these are implemented by the British Council. Other projects are funded by the KHF as part of their human rights work. In fact, a large number of other KHF projects could also be regarded as part of the promotion of human rights in their broadest sense including social and economic rights. An example is the programme to support rural livelihoods run by the KHF.[308] The British Council on its own account promotes human rights through its Grant-in-Aid and the REAP academic partnerships, as we describe later.[309] There are also a variety of other smaller funding mechanisms, including Chevening scholarships and sponsored visits, which can be used for human rights projects. Members visited an impressive project in the Moscow suburbs funded by the HRPF and run by dedicated young staff to divert children aged 7 to 18 from petty crime and drug or alcohol dependence. This was one of four projects in Moscow funded by the HRPF. We understand that the fund would be drawn upon for many other worthwhile projects, but that it was now fully committed.

116. We found that human rights activists we met in Russia were generally complimentary about the efforts which British diplomatic staff had made to remain in contact with them and to support their activities. Professor Kartashkin, the President's adviser on human rights, also described fruitful contacts with the United Kingdom which had been established. In addition he outlined a number of other practical measures where assistance could be provided. Among his suggestions were:

· production of material on human rights in the social/economic sphere

· translations into Russian of appropriate British human rights material

· production of videos/newspaper articles in Russian on the British human rights experience

· the training of specialists, especially in criminal law and prison administration

· the creation of a Russo/British Human Rights Centre.

These all seem to us eminently sensible suggestions which we trust that the Embassy will examine seriously.

122. Amnesty International was positive about the genuine and active commitment to human rights which it saw being demonstrated by the British Government in Russia. It singled out among bilateral programmes the judicial support programmes; support for Penal Reform International's work to improve prison conditions; the Embassy human rights programme; DFID's study on key issues on poverty from the perspective of the poor and the ASSIST programme to promote human rights standards in the military and police.[310] The need now, in Amnesty's view, was for a review and evaluation process to begin to see which of the projects were meeting their objectives and which were useful to take forward. We agree with this.

123. We were able to inspect the Moscow Embassy's Human Rights Action Plan for 1999-2000. The action plan proposes a continuance of focus on the existing targets of increasing public awareness, influencing legislation and legislators and NGO development. It stresses the importance of co-ordination of the United Kingdom's bilateral and multilateral effort, and (while not excluding other possibilities) suggests that activity should be focussed on prison reform, support for vulnerable social groups (including women, children and the disabled) and for ethnic or religious groups who suffer discrimination, and on the armed forces and alternative military service. Activity should also be concentrated on areas where British aid is already active and where the local authorities are likely to be receptive. We have no reason to question this action plan, and are delighted to see the Embassy working to an Annual Action Plan under which success can be monitored. Need is so widespread that the British Government—and indeed EU Governments as a whole—must be focussed and selective. We endorse the Government's current policy on support for the promotion of human rights in Russia, and recommend that the Government carefully review and evaluate its human rights projects in Russia to determine the most effective result for the resources the United Kingdom is able to offer. We also recommend that the Government emphasise to the Russian government that non-compliance with human rights standards is a serious impediment to partnership with Russia.

ASSISTANCE TO COMBAT CRIME

124. The United Kingdom has a clear mutual interest with those in Russia who wish to eliminate corruption and crime: a corrupt environment in Russia is not conducive to British business, and there is also a concern that Russian organised crime might use the City of London for money laundering purposes or might seek to tap into lucrative markets for prostitution, drugs and other areas of crime in this country. Fighting crime is an area where bilateral co-operation is of great potential importance.

125. Money laundering is a particular worry for the United Kingdom. The City, the Crown Dependencies and Overseas Territories may all be targets for those who wish to dispose of dirty money. The Foreign Secretary told us that the FCO was "very alive to the problem of money laundering at an international level", and had "taken a lead" in trying to persuade Russia to adopt money laundering legislation. However, he emphasised the difficulties involved in making progress, particularly in view of the state of the Russian banking sector.[311] In Dr Galeotti's opinion, new Russian money laundering legislation was due partly to pressure from the USA, though it was still an open question whether the system would be properly policed.[312] The City is by international standards an extremely well regulated financial centre, with considerable expertise at combatting money laundering. This is an expertise which could be of value to the Russians. We recommend that pressure on Russia to enforce proper anti money laundering standards be maintained at the highest level, and that the assistance of British regulatory experts be offered to Russia.

126. Drug-related crime is also potentially a threat for the United Kingdom. While the use of drugs in Russia is obviously of concern, the possibility of trafficking through Russia into Western European markets is directly worrying for the British Government. The FCO described the drug problem in Russia as "not at the moment a major threat to the United Kingdom."[313] Amplifying this, the Foreign Secretary told us that the current British view was that Russia was not assessed as an important route for drugs coming into this country. However, he did tell us that the Government was "deeply concerned" about the "problem of drug addiction and drug running and the organised crime that goes with it in Russia."[314] He was also willing to consider, with Customs and Excise, the placement of a Crime and Drugs Liaison Officer (DLO) outside Moscow to help nip in the bud developing drugs routes into the United Kingdom, though he pointed to the problem of scarce resources.[315] We recommend that close attention continue to be paid to the potential drug threat to the United Kingdom from Russia.

127. There has been welcome progress in recognising Russia and the United Kingdom's mutuality of interest in suppressing crime. A memorandum of understanding between Russia and the United Kingdom on combatting organised crime was signed on 18 June 1998, following on an Agreement on co-operation in the fight against crime signed the previous year. The Foreign Secretary spoke positively of the memorandum to us[316] and the FCO told us that they were "working on a similar arrangement between the EU and Russia."[317] A draft Action Plan on organised crime was drawn up under the EU-Russia Common Strategy in the second part of 1999, and was due to be finally agreed in early 2000 in the light of a EU-Russia seminar on organised crime held in December 1999.[318] Dr Galeotti, however, pointed out that the memorandum achieved little in itself, and needed to be followed through both by co-operation at the political level (where he felt that the FCO had been excessively reluctant to criticise Russia) and at the operational level (which he believed to be neglected by British diplomats).[319] The Foreign Secretary repudiated the views of Dr Galeotti that diplomatic staff in Moscow "reflecting the FCO's general distaste of law-enforcement affairs, tend to regard the DLO's presence as an excuse not to get involved themselves."[320] As far as co-operation at the political level is concerned, the Prime Minister himself has stressed the importance of co-operation against crime even at a time when other co-operation might be put on hold because of Chechnya.[321]

128. We are aware that there is a growing police-to-police relationship between Russia and the United Kingdom, involving the Metropolitan Police, the National Criminal Intelligence Service and the National Crime Squad. Partly this is a bilateral relationship, though contacts also occur through the law enforcement aspects of G8. Certainly, the message we received from law enforcement officials in Russia was that relations with the equivalent British authorities in the war against drugs were excellent. There have been considerable exchange of techniques, experience and training, and frequent and useful exchanges of operational information. A number of joint operations against criminal groups are being or have been undertaken. Police-to-police contacts are particularly valuable, providing an opportunity for practical knowledge to be shared between practitioners. The British system of policing is also well suited for developing contacts between provincial British forces and the regions of Russia. We were, however, concerned to hear in St Petersburg that collaboration between the local police force and forces in Scotland had been restricted by lack of finance. In our view, these types of arrangements pay dividends far in excess of their modest cost. We recommend that police-to-police contacts form part of the Good Governance Programme which we have earlier recommended.

129. It was also made clear that Russia does not have all the material resources it needs to sustain its anti-drugs work. Dr Galeotti quoted to us the example of Finland, which had placed a handful of properly trained and briefed officers in St Petersburg who had had a direct impact on organised crime in the region.[322] There is a good case for the United Kingdom to offer the practical assistance of at least one extra crime and drugs liaison officer, possibly operating out of the Consulate General in Ekaterinburg or the Consulate General in St Petersburg, who could liaise with local law enforcement officials to protect British national interests by helping to close down drug routes into Western Europe and monitor organised crime which may target the United Kingdom. These officers could also help disseminate best practice from the United Kingdom—as well as learn from Russian colleagues. We recommend that the FCO consider the feasibility of increasing the number of crime and drug liaison officers working in Russia, in particular considering whether one might be based outside Moscow, and discuss with DFID the possibility of partial funding of the new post or posts from the Know How Fund.

262 Available on www.britishcouncil.org. The survey was conducted by MORI in St Petersburg, Moscow, Samara and Ekaterinburg, amongst 400 Russians aged 20-40, with quotas for sex, educational qualifications, work status and income. Back

263 45 per cent of Russians would like to study in the UK, many more than any other country (the next most popular being the US, with 19 per cent). Back

264 58 per cent believed that the UK had world-beating companies, compared to 86 per cent for Germany, 96 per cent for Japan, and 94 per cent for the US. Back

265 79 per cent of Russians thought that the UK was a traditional society (as opposed to a modern society), the highest percentage of any country surveyed. Back

266 36 per cent identified "Tradition/culture/cultural heritage/conservatism" as the UK's main strength, the highest percentage of any country surveyed. Back

267 25 per cent identified "Traditional/conservative/out of date for the modern world/against innovation/not flexible as the UK's main weakness. Back

268 In Brazil 65 per cent believed that the United Kingdom valued its relationship with Brazil "very much" or "a fair amount"; in China 50 per cent; Egypt 78 per cent; France 66 per cent; Germany 77 per cent; India 75 per cent; Malaysia 78 per cent; Mexico 42 per cent; Poland 30 per cent; Saudi Arabia 81 per cent; South Africa 73 per cent; and Turkey 34 per cent. Back

269 Ev. p. 55. Back

270 Q122. Back

271 Aggregate of those responding "very much" and "a fair amount." Back

272 25 per cent have an unfavourable view of the US, compared to 8 per cent for Germany. Back

273 Q112. Back