Trade mission meeting uncovers the gap between public protectionism and the need for global integration (426 words)
Published:
10/22/2001
In a meeting with a trade mission in Moscow, led by US Secretary of Commerce, Donald L. Evans and including Thomas Pickering, a Senior VP of International Relations at Boeing, Russian Premier Mikhail Kasyanov suggested that his government had "lost control" of the investment process in Russia and sought greater coordination at industry level with investors to bring it back on track.
Pickering, a former US ambassador to Russia and Under Secretary of State for Political Affairs, who joined the aircraft maker in January 2001, informed Kasyanov that his company was interested in leasing further aircraft to Russian airlines and would even like to participate in aviation lease companies within Russia. His statements coincide with Aeroflot's confirmation that it is in talks with Boeing over acquiring further aircraft.
According to some media reports, however, Kasyanov said that Russia would continue developing it own aircraft building capability and recommended that Boeing might follow the route of Pratt & Whitney (PW), that has both invested in and transferred technology to Russian aerospace companies.
If the reports are correct, his comments seem to be out of kilter with recent relations between Boeing and Russia, marked by the recent deal with Sukhoi for the development of a largely Russian designed and ultimately Russian produced regional jet: the culmination of investment in the region of $1.3 billion in various Russian space and aerospace projects over the last decade, according to Boeing. Other sources quote a government official as saying that the premier recognized the commitment to Russia that Boeing had made.
While Kasyanov may have been keen to be seen to standing up for the local industry, to date, most funding appears to be coming from foreign producers, such as Boeing, which is currently employing a large team of Ilyushin designers in its Moscow design centre. This serves to highlight what has increasingly become a public and private aerospace policy, characterised by defensive public statements, but by actions that will steadily integrate the Russian industry within the global industry at the expense of building complete major civil aircraft. This was recently illustrated by the recommendations of the Ministries of Transportation and Economic and Trade Development that appear to give considerable leeway on the maintenance of aerospace tariff barriers within Russia. Such liberalisation is an essential part of Russian accession to WTO, for the US at least, with President Putin sticking to his timetable of September 2002.
Article ID:
2843
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