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4/1/1992 - The Russian Point of View by Peter H. Christiansen

NOT FOR PUBLICATION WITHOUTWRITER SCONSENT INSTITUTEOFCURRENTWORLDAFFAIRS PHC Seattle Washington April Th___e Russian Point View Dear Peter As promised newsletter introduce Russian angle North Pacific fisheries story The Russian Far East which extends three thousand miles Chukot Peninsula North Vladivostok South becoming significant Pacific Rim Yet there problems confronting makes transition isolation integration The turmoil Far East shows constellation challenges social environmental political economic confronts Russia stumbles blinking after slumber bright lights West The Far East Russia frozen outback windscoured Siberia Much closer Seattle Moscow The largest Vladivostok population about million The Far East total population million spread twice territory Alaska The weather stormy Harsh climate rugged landscapes worked effectively Cold War politics keeping isolated Western The frontiers Siberia opened about American West settled because great distances harsher climate Siberia remained considerably developed Because natural resources Russians regarded Far East national treasure reserve inevitable chernyi black misfortune With collapse Soviet Union black Careful Far East riches fledgling Russian Republic would nation As Russia integration West success Pacific Rim would great dividends Russia economy Yeltsin government The Far East potential inspires plans Peter Christ iansen studying political economic relationships between Russia United States Japan reflected fisheries North Pacific Since Institute Current World Affairs Crane Rogers Foundation provided fellowships enable outstanding young adults outside United States write about international areas issues Endowed bythelateCharlesR Crane theInstituteisalsosupportedbycontributionsfromlike mindedindividualsand foundations Some officials Far East replace Hong Kong after A possible dream which attained onlyvercoming shock sudden entry West burden Russia internal chaos legacy tortured Russians traditionally regard Far East dread The Far East kartoga place exile labor death century Sakhalin Island Tsarist Russia incorrogible criminals including political prisoners considered fearsomely isolated Europe civilization The abominable prison conditions there moved Feodor Dostoevskii Anton Chekhov write books scandalized Russia lurid tales convict In Russo Japanese War erupted Far East territorial disputes The humiliating defeats Russian naval forces hands Japanese Sakhalin territorial concession following cessation hostilities created bitterness persists nearly century later Later World War II Soviet Union declared exhausted Japan reclaimed Sakhalin possession Kurile Islands Both Russia Japan claim islands In 1920s 1930s millions class enemies rotten kulaks Far East labor camps during Stalin bloody holocaust Magadan large shore Sea Okhotsk infamous deathplace estimated three million souls banished there mining permafrost Much Far East opened convicts modern cities ports built using GULAG labor In North Kamchatka Peninsula dangles Ring Fire along subducting Pacific plate It unique geologic areas world active volcanoes Kamchatka earned notoriety spasms Cold War Soviet Border Patrol MIG pilots gunned Korean passenger overflew sensitive military airspace Back mysterious armed suspicious owner strangers When perestroika glasnost dawned 1980s Far East darkness General Secretary Gorbachev counting economic restructuring attract Western businesses generate needed Soviet Union viable A thinking foreign policy overture Pacific natural With untapped natural resources fortuitious geographical position Far East looked perfect place experiment integrating USSR world In May flushed success Reagan Gorbachev Moscow Summit United States Secretary State George Schultz Soviet Foreign Minister Eduarde Schevernadze signed agreements breaking ground joint US Soviet ventures Soviet Union Important among these North Pacific Fisheries Cooperation Agreement which American fishing companies access territorial waters Far East first The initial response overture encouraging owner suddenly interest fancy neighbors Trade delegations forth sister pairs flourished logical San Francisco Vladivostok Petropavlovsk Kamchatskii Dutch Harbor rather Seattle Tashkent American scientists investigated closed wonderfully diverse bioregion Alaska Airlines Aeroflot opened routes Anchorage Khabarovsk other Far East cities Vladivostok Soviet Union largest naval opened foreigners first years billed itself Soviet San Francisco And first Japanese American biznezmen given hidden treasure houses Siberia They liked reserves timber minerals precious metals diamonds The problem found getting treasure swamps forests trackless taiga Driving Far East Europe impossible Cargo arrives overland Western Russia outside world Trans Siberia railway Baikal Amur Mainline BAM Transport usually Goods transit Europe travel almost apidly coming Far East access Asia however Most region roadless impenetrable taiga trackless swamp Modern Siberyaki travel between enclaves Without roads rails Siberia wealth inviolate safely locked among dense forest Fish oceans different story Because distance capabilities modern fishing fleets caught transported Western markets without relying Russian transportation infrastructure Fleets mobile contained operations function without going Far East ports supplies In three years fishermen countries droves Far East Russia The first pioneers weren grizzled Bering Sea salts tough trawlers They polished Tokyo Seattle Taipei investors analysts preceding money venture They heady As fisherman Ron Peterson recently recalled Pacific Fishing magazine It incredible approaching Russians It girls Dutch Harbor being approached fishermen Saturday night dance The Soviets fielding incredible offers Americans throwing money around Reports quarter halibut schools pollock untouched masses Kamchatka King lured businessmen uncharted terrain The eager Soviet ministers signed their contracts abandon The restructure develop foreign contacts precious dollar The Soviet bureaucrats becoming Western biznezmen There fortunes their little backwater By The Far East fishery lived billing Seattle fishing companies state factory trawlers crabbers Test fishing yielded impressive prospects large scale development seemed excellent Careful observers scene however barometer change stormclouds gathering horizon At first troubles seemed inexperience after xenophobic years communism Soviets little nothing about Western doing business Concepts taken granted Western fishing companies contract often proved completely alien Soviet ministers The knowledge earned toiling under Soviet following dictates omniscient Communist Party often proved superfluous dealing market businessmen Soviet bureaucrats working freshly minted could glacially processing business ventures through state machinery Interagency tussles between national state local ministries slowed deals West Communications problem capital Moscow provided rudimentary connections world Corruption greed considered modus erendi unscrupulous Soviet apparatchiki American quick mentality Underlying these problems deeply ingrained structural difficulties Administrative chaos became endemic during waning Soviet Union In communist Russian Republic disrupts virtually every government office every industrial agricultural enterprise There graphic illustration chaotic situation turmoil Far East fishing industry The former Soviet Ministry Fisheries fallen times Russia The Soviet Union Ministry Fisheries enjoyed great prestige In twenty years expanded fivefold became proud owner modern fleet vessels fishing every ocean world Soviet fishermen annually brought millions North Atlantic Indian Ocean Antarctica North Pacific They provided Soviet Union important source anima protein agricultural shortfalls serious concern The Ministry Fisheries owned entire ports shipyards merchant vessels processing facilities libraries resorts fleets automobiles administratitive buildings everything needed large industrial monolith functioning smoothly Fishing prestigious offering Soviet standards advancement chance outside world As former Soviet enterprises problems Ministry Fisheries began earnest after failed August Following collapse Soviet government Republic President Boris Yeltsin decreed number administrative reform measures According Ministry Fisheries subsumed Ministry Agriculture renamed Fisheries Commission Suddenly fisheries ministers found themselves taking orders their former agricultural coequals Worse privatization The former labor kings wielded indisputedable power giant Dalriba Far East Fishing Company branch Ministry Fisheries watched their monopoly crumble Worse democratization required accountable increasingly assertive workers Fishery workers always independent breed Russian willing miners strike their demands Both Ministry Agriculture fishery workers putting considerable pressure Fisheries Commission Far East Russia foreign fishing currency In international fishing controls resource equals profits The major issue Russian Far East fishery resource allocation whoever deciding voice Fisheries Commission Ministry Agriculture workers rewards Ame rican fishing companies Far East occasionally themselves drawn confusion corruption One ublicized which inspired seperate fishing industry journals write articles titled Russian Roulette involved Deep Sea Fisheries Incorporated Seattle Washington Deep Sea Kamchatka Peninsula search joint halibut fishing ventures They found partners North Kamchatka Independent Fishing Association NKIFA Korf The companies agreed joint venture called SPAKS which bought reoutfitted Soviet factory trawler Kamchatskaya Zvezda Kamchatka Star The Zvezda given mixed Norwegian Russian understanding Norwegians would teach their Soviet shipmates about advanced processing technology aboard The Zvezda registered Liberia thereby securing financing Western banks which unwilling underwrite Russian biznezmen Meanwhile American fishery hinted significant stocks halibut In Zvezda fishing arnest hauled halibut short The Zvezda Korf offload The trouble began after The Zvezda offloading Soviet Coast Guard ordered Soviet members disembark immediately The halibut confiscated Zvezda Norwegian United States What worse Amazingly North Kamchatka Independent Fishing Association called Coast Guard The NKIFA claimed being unfairly charged Zvezda Deep Sea brokers received percent profits There appeared another motive however The NKIFA found Japanese company willing higher price A pretext invented seize joint venture better profit The Americans livid Deep Sea placed Zvezda refused release Dutch Harbor until compensate their share The Soviets apparently realize although Zvezda flagged Liberia actual bearing legal status vessel owned jointly American Russian company Realizing stood their share Soviets Seattle negotiate settlement Negotiations badly Deep Sea executive John Wendt Seafood Leader magazine could about percent commission I They We We never important matters discuss wouldn about anything They talking pennies talking about dollars We found impossible They inkling doing business Eventually parties settled unfortunate compromise Soviets pallets groceries while Deep Sea Kamchatskaya Zvezda The unfortunate vessel since SPAKS dissolved A surprisingly upbeat Deep Sea Fisheries learned mistakes found partners action Kamchatka Sea Okhotsk Deep Sea experience means either Arctic Alaska Fisheries Incorporated involved pollock ventures shore plants Far East Marine Resources Company International original Soviet American joint venture fishery started branch lumber business remains active JV crabber Diomedes selling marine equipment business consulting Other companies trade fishing technology equipment share quota The consensus among industry executives investment provided companies patient willing As Russian lawyer visiting Seattle If gamble Far East The stakes atmosphere hotly competitive The Far East fishery provides American companies unexplored fishing grounds these companies overcapitalized feeling pressure payments shrinking quota shares Ironically these boats replaced Soviet fishing fleet worked American waters Now going Russian waters joint ventures their former partners In March The United States Department Commerce allocated almost entire Alaska pollock fishery local shore based processing plants The decision preserve Alaskan resources Alaska rather having fleets Seattle Oregon exploit By percent pollock Alaska allocated exclusively shore based processing The DOC decision mortal water fishing fleet which dominates competition shore based plants According obser total financial losses West Coast water fishing fleet could hundred million dollars The spectre bankruptcy companies scrambling Russia A country verge collapse borrowing money West alive keeping thousands Americans Fishing company catch taken another money Russian biznezmen willingly highest bidder A recent scandal involving American investment Performance Investment Group heavy publicity Russian fisheries trade magazine Sovetskii Ribak Soviet Fisherman According articletitled Who Robbing Russia Performance Investment Group Seattle signed agreement Ministry Agriculture harvest metric groundfish Russian waters annually until Kamchatka locals The scandal raised number important issues Far East Foremost among these democratic Moscow apparent willingness these resources without considering local opinion As article author wrote Following liquidation USSR Ministry Fisheries agency functionaries hoped organizational system would established which would allow rational marine resources regime independent management fishing industries But subordination fishing branch agrarians burner Judging everything Russian government still learned listen voice little The profits venture ostensibly Moscow United States deeply upset Kamchatkans Their fishing ports repairs modernization There preliminary investigations environmental impacts fishery consideration impact local force although Petropavlovsk Kamchatskii population works directly fishing industry The infusion American dollars goods would bounty remote corner Russia Yet again democratic government distant despotic Moscow bureaucrats steamrolling locals This though locals acted The trade union letters protest Moscow United States Lenin International Trade Union The campaign successful Russian government rescinded Performance Investment Group banned doing business Russia Some Performance executives reportedly declared persona grata On Performance Group affair seems victory locals against corrupt Moscow sleazy Americans But really According fishing industry source familiar Performance Investment Group legitimate operation backed United States government investment guarantees Performance Investment Group source asserts together handsome package developing local shore based processing plants infrastructure necessary running Performance Group source contends intended direct forty percent venture profits Kamchatka They undeserved press Russia I thought pretty package source The structural counterpoint chaos bureaucracy chaos borders The Far East baffling jumble Exclusive Economic Zones Disputed Territories ocean areas The Russian Federation Exclusive Economic Zone example fails enclose Doughnut Hole Bering Sea smaller lesser known Peanut Hole Sea Okhotsk These zones scene intense unrestricted fishing activity fleets Japan Taiwan Pol People Republic China Republic Korea Bulgaria The unrestricted fishing greatly effects stocks adjacent zones however The Doughnut Hole described fishing spokesman biological desert The Russian government working United States close Doughnut Hole unrestricted access third country fishing vessels Both governments evidence commercially valuable pollock salmon native Alaska Russia migrate through Doughnut Hole This means considered straddling stock owned nation Exclusive Economic Zone origin A conference Seattle February between United States Japan Russia Taiwan Poland other nations fishing Doughnut Hole convened agreement limit fishing No general management agreement reached Fishing Doughnut Hole continues unabated The Peanut Hole presents different chall Russians Situated middle Sea Okhotsk Peanut Hole surrounded exclusively Russian waters Its waters large pollock stocks target unrestricted international fishing An apparently solution simply prohibit passage fishing vessels through Sea Okhotsk route Peanut Hole Unfortunately would violate international which permits passage peaceful vessels through another nations territorial waters Restricting passage could therefore serious consequences Russian Federation which could passage vessels banned other countries retaliation Declaring larger Exclusive Economic Zone unilaterally would tamper arrangement hammered years United Nations effort might start divisive trend among maritime states Still Russia wants unrestricted fishing Peanut Hole The difficult conundrum gener novel solutions One international marine reserve under Russian juristiction The effective advocates direct action declare Peanut Hole missle testing ground Russian military The territorial issues thornier emotional along southern border Japan where Kurile Islands remain under dispute forty years after Second World War The Kurile Islands north Hokkaido Russia naval control entrance Sea Okhotsk These islands noted their saury salmon fisheries pollock other groundfish crabs They reputedly great natural beauty there plans develop resort For Russians losing Kurile Islands would losing territory excellent economic potential spoils Second World War The Russians contend owned Kuris since seventeenth century Russian explorers discovered Japan claims Land Rising Sun there first Russia reminds Japan isolationist Japanese square The Russians remind Japanese Kuriles Some victory counter Japanese already As arguments around around politicians venture forth creative solutions The sighted comes Sakhalin local government Valentin Fyodorov Fyodorov thinks Russian Federation Japan should declare Sakhalin Island Kuriles Hokkaido jointly managed economic This construct fourth imagines Both territories remain within sphere Soviet Japanese state sovereignity economic plane single entity cojointly The visionary Fyodorov would Kurile islands Hokkaido throw bonus helping bring Sakhalin West Fyodorov however relinquish Kuriles Japanese We hardly lament allegedly missed chances could offered theoretical large scale cooperation Japan What ourselves economically create market based economy Far East islands first closed order Japanese economy equal terms President Yeltsin advocates giving Kuriles after negotiations greater bargain increased Japanese investment Polemics aside Soviet Union taken Kuriles relations between Japan Soviet Union turned better Had Far East would doubtlessly important Japanese economy Alaska Sakhalin Island present forward looking region Far East In Russian Republ Parliament passed legislation making Sakhalin Nakhodka economic Sakahlin offer attractive advantageous features Western businesses holidays imports exports Western businesses North Sakhalin natural fields north recently concluded agreement Marathon Oil develop Nori Oil Fields Great natural beauty makes Sakhalin excellent candidate tourism There strong salmon fishery access Okhotsk pollock grounds American fishing companies Arctic Alaska Fisheries there results Japanese Taiwanese Chinese round roster Further south Primorskii Krai Maritime Province developed Russian Far East The Primorskii Krai includes cities Vladivostok Nakhodka It region Far East direct connections European Russia The terminus Baikal Amur Mainline Alexandrovsk access Sakhalin The Trans Siberian Railway Vladivostok The province accessible timber mineral reserves South Korea Japan active region Hyundai Corporation example constructing hotel Vladivostok Nakhodka foreigners Soviet Union declared economic along Sakhalin According visitor Far East Russian government recently erected barbed fences around Nakhodka economic activity there serious Cynics there little barbed keeps people West instead West Russia looks someone wrong fence A dawning Far East emerging darkness Ii Sources Dyakonov F D Formirovaniye narodnokhozyaistvennoqo kompleksa Dal Vostoka Nayuka Moskva Kazcynski V Perestroika Soviet Livinq Marine Resources Policy The Pacific Dimension Reviews Aquatic Science Shapiro S Russian Roulette Pacific Fishing Yearbook Markov I Kto Grabit Rossiyu Sovetskii Rybak January Uncredited Reportazh Petropavlovska Sovetskii Rybak January Robinson D New Laws Take Joint Out Russian Ventures Journal Commerce February Soviet Ministrov RSFSR Polozheniye svobodnou ekonomicheskoi raione Nakhodki Primorskoqo kraiya Soviet Ministrov RSFSR November Aknowledqements Many thanks University Washington School Marine Affairs Professor Vladimir Kazcynski support sharing knowledge about Russian fisheries I grateful Professor David Miles University Washington School Marine Affairs useful insights regarding effects administ rative chaos Russian Far East fishery I grateful Beth Jacobsen Deep Sea Fisheries Inc support Roy Warner Arctic Alaska Fisheries Inc firsthand information Artic Alaska operations Far East Paul Iremonger Marine Resources Company International taking speak Moscow Note All Russian language translations report author accepts responsibility their accuracy Received Hanover