FOR IMMEDIATE RELEASE - Sept. 19, 1996

Lowry to visit Russian Far East to expand state's trade opportunities

OLYMPIA -- Taking steps to overcome trade barriers and increasing opportunities for Washington companies interested in trade with Russia are on Gov. Mike Lowry's agenda early next week as he begins a five-day visit to the Russian Far East.

Lowry is scheduled to depart Saturday (Sept. 21) for a series of meetings in Khabarovsk and the port city of Vladivostok. Key to the governor's visit is a meeting of the Gore-Chernomyrdin Commission Ad Hoc Working Group, a partnership created in late 1994 to foster more rapid expansion of commercial ties between U.S. west coast states and Russia's east coast.

In addition, Lowry will meet with Vladivostok Mayor Tolstoshein and Gov. Evgeniy Nazdratenko of Primorye Krai, which is one of nine territories in the Russian Far East. The governor is also scheduled to tour the Port of Vladivostok and will visit the Washington state trade office and several local businesses.

Lowry said trade between Russia and Washington state has both an impressive history and a promising future.

"In 1990, it was virtually impossible to locate a shipping company that called on both Washington and Russian Far East ports," Lowry said. "Today, six new shipping companies serve those ports and those companies are part of the reason why Washington state exports to Russia increased nearly fivefold from 1993 to 1995."

In 1993, the state's exports to Russia totaled about $62 million. Two years later, Washington exports added up to nearly $300 million supporting about 6,000 jobs in the state. Because most of those exports are bound for the Russian Far East, Lowry said the state's targeted efforts to overcome barriers to trade are particularly important.

"The Russian Far East is one of the most dynamic spots in the Russian Federation for doing business," he said. "The area is known for its extensive natural resources, active regional economy and growing business ties with foreign companies. It is a perfect market for our state's food products, building materials, and for mining, fishing, and marine equipment among other things."

Following the breakup of the Soviet Union, Seattle was chosen by the new Russian government as the site of their first Russian consulate. In 1994, Washington state opened a trade office in Vladivostok and is still the only U.S. state to have a foreign office in Russia.

The Gore-Chernomyrdin Commission working group formed in December 1994 grew out of remarks made by President Clinton and Russian President Boris Yeltsin in Seattle earlier that year. In September 1994, Clinton and Yeltsin had underscored the importance of improved economic relations between the two countries, while Yeltsin called for the expansion of trade, commerce and communication between the Russian Far East and the U.S. west coast.

The ad hoc working group held its inaugural meeting in Seattle in June 1995. Comprised of senior officials from both countries' federal governments and representatives from regions in the Russian Far East and U.S. west coast states, the group has been working with private industry in Russia and the United States to remove barriers to trade and investment between the two countries.

During the Seattle meeting, government and business representatives identified a number of factors that hinder trade between the two regions including customs procedures, legal and regulatory issues, transportation and telecommunications issues. In Khabarovsk, Lowry said, participants will take the next step toward resolving some of those problems. In addition, the agenda includes private sector meetings on such topics as telecommunications, fisheries, forestry and transportation.

The Khabarovsk gathering the panel's second meeting also will include a discussion of the CLEAR-PACK project, a pilot proposal developed in Washington state that could revolutionize trade between the two regions. CLEAR-PACK would allow for advanced electronic clearance of customs documentation, which will enable goods to move more quickly through the ports ultimately saving time and money.

Next week's meeting is expected to draw more than 70 Americans most from Washington, Oregon, California and Alaska and about 120 Russians from the Far East as well as Moscow.

Lowry said the ad hoc working group can play a significant role in fostering two-way trade between Washington and the Russian Far East, particularly given Russia's efforts to make a lasting transition into a modern market economy.

"Washington state companies have a wealth of products and services that are a natural for Russian markets, and a number of businesses have already developed a strong trade relationship," Lowry said. "Still, given the logistical challenges that remain and the area's 70-plus year history of the need for government approval, this sort of partnership is a significant step toward opening important doors for additional joint-venture and direct trade activities."

For more information, contact the Governor's Communications Office, (360)753-6790.

Statistics provided by the state office of Community, Trade and Economic Development and the Office of the Trade Representative.