'Damage Has Been Done': Exclusive Interview: Russia's Prime Minister on Washington-Moscow Tensions, Corruption, Communists and His Political Future

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On the eve of his first visit to Washington, Russia's prime minister, Sergei Stepashin, 47, sat in Moscow's "White House" and spoke with NEWSWEEK's Lally Weymouth about revitalizing U.S.-Russian relations. The former Interior minister, whom Boris Yeltsin promoted to prime minister in May, will meet this week with Vice President Gore and President Clinton, both eager to patch up differences with Russia that emerged during the Kosovo war. Although Stepashin is expected to receive $4.5 billion from the International Monetary Fund and a warm White House welcome, rumors circulate in Moscow that his position is not secure. Stepashin admits he's heard the rumors, but no one--except perhaps the notoriously capricious Yeltsin himself--can predict the Kremlin's next move.

WEYMOUTH: What do you hope to achieve at the meeting of the commission you co-chair with Vice President Al Gore?

STEPASHIN: This will be our first meeting and my first visit to the U.S. as prime minister. I had a number of telephone conversations at a difficult time with the vice president--during the Kosovo settlement. I had the impression that he and I understood each other. There are two tasks I hope to accomplish during the visit. The first is to get to know Gore. I believe good personal contact can be helpful in solving difficult questions. Secondly, we're going to discuss economic matters. Then, we will discuss the reconstruction of Yugoslavia. I would [also] like to find out what the vice president thinks about the ABM and START II treaties.

How much damage has Kosovo done to the U.S.-Russian relationship?

No doubt serious damage has been done. However, I believe that our relationship is stable and can't be shattered even by the war in Yugoslavia. We should draw lessons from Yugoslavia: if we are partners, and we are serious partners, we should respect each other's positions and strive for compromise before military action begins. At the moment, [Russian-NATO relations] are at an impasse. We are very concerned with NATO expansion eastward.

The administration has linked the number of U.S. commercial satellites that Russia is allowed to launch to cutting off the flow of missile and nuclear technology from Russia to Iran. Has Russia stopped this?

Nobody has proved that Russia supplies missile technologies to Iran.

But the U.S. has sanctioned several companies here and believes that Russian entities continue to aid the spread of weapons of mass destruction.

The more restrictions that are placed on Russia reaching world markets, the more our companies--in order to survive--will seek any outlet for their goods, even via shady deals.

The trade relationship between the U.S. and Russia is uneasy. Russia wants to sell more steel in the U.S. market, and America wants more access to Russian markets for aircraft. What solution do you see, and when is Russia going to join the World Trade Organization?

We shall join the WTO--the only problem is the date of our entry. U.S. [import] restrictions have dealt a serious blow to our steel industry. I would like to note that [Gore] has supported me. But I understand that he and the president must take Congress and the steel lobby into account now that elections are coming up. I also want to raise the issue of the aerospace industry--I am going to Seattle to visit Boeing and will discuss cooperation.

Rumors are swirling that you won't last as prime minister. Is there any truth to these reports? Do you plan to be a presidential candidate? Who is seeking to undermine you?

If I give you an open and frank answer, I would be sacked immediately. [That's] a joke. Of course, in a situation of political instability with elections coming up, rumors are inevitable. I don't pay much attention because I have been in politics for 10 years and have learned to ignore such rumors. As for the presidential election, the balance of forces will be clear after the elections to the Parliament in December. …