ctjitcri -SBEURRET-' 2226 THE WHITE HOUSE WASHINGTON DECLASSIFIED PER E 0 13526 015- oT'BX-T - C' J '3 l X0 S KBH MEMORANDUM OF CONVERSATION SUBJECT Working Dinner with President Boris Yeltsin U PARTICIPANTS The President Warren Christopher Secretary of State Lloyd Bentsen Secretary of Treasury Mack McLarty Chief of Staff George Stephanopoulos Assistant to the President and Director of Communications Anthony Lake Assistant to the President for National Security Affairs Samuel Berger Deputy Assistant to the President for National Security Affairs Thomas Pickering Ambassador-Designate to Russia Toby T Gati Special Assistant to the President for National Security Affairs Nicholas Burns Director for Russian Ukrainian and Eurasian Affairs NSC Staff Rose Gottemoeller Director for Russian Ukrainian and Eurasian Affairs NSC Staff Notetaker Boris Yeltsin President Boris Fedorov Finance Minister Andrei Kozyrev Foreign Minister Alexander Shokhin Deputy Prime Minister Viktor Ilyushin Chief Assistant to the President Vladimir Lukin Russian Ambassador to the US Dmitri Ryurikov Assistant to the President Georgy Mamedov Deputy Foreign Minister Vyacheslov Kostikov Press Secretary April 3 1993 6 30 - 8 30pm Vancouver Canada DATE TIME AND PLACE Both Presidents opened the dinner by giving prepared toasts President Yeltsin This is an excellent place with the background of Vancouver harbor U The President U -S EGRET Declassify on Did you take a boat ride after our meeting today CUNTON LIBRARY PHOTOCOPY OADR O -SEGRET-- President Yeltsin Yes we took a ride and saw one of the biggest ports in the world -- it handles 79 million tons per year I don't know about the U S but our biggest port turns over only 60 million tons The surroundings are not only picturesque but good for development U The President As I drove up I saw many people holding Russian flags Do many Russians live here U Minister Shokhin These are not real Russians or else they wouldn't carry flags upside down U President Yeltsin They might be Russians who have emigrated -we call them our compatriots abroad They might have suffered during the time of the Tsars The Grand Duke Vladimir Kirillovich was alive at the time It was a very touching meeting We have adopted a law on dual citizenship This is another benefit of democracy If all of the states of the former USSR adopted such laws there would not be a problem To be a citizen of Lithuania and Russia is okay Estonia and Russia is okay But Estonia doesn't have such a law U Secretary Bentsen Mr President how much time will you spend campaigning between now and April 25 U President Yeltsin The President speaking U All the time until April 25 That's the right answer U That's a politician President Yeltsin I'll not miss a day U Secretary Bentsen You should use television U President Yeltsin There will be a special program every five days with students artists workers intellectuals etc For example on April 12 I will meet 12 000 students I don't have the right to lose It would be treachery to Russia Things the people have only dreamt of for years now they have them We have 60 000 private industries and 5000 of them are big corporate enterprises Thirty million people are private owners Where the genetic code has been removed from the brain there is no notion of private ownership Today the most important thing is psychological change in Russia -- people do not want the communists to come back Of course we will have difficulties along the road but we will manage What Bill suggested today is very important to helping us along the road We welcome it The President What I thought we would talk about tonight is what we can do I want to put together a program to build on what you are doing and what you think is important Members of Congress have asked me what can we do for Yeltsin that responds to what he wants what he thinks is needed to help the Russian people -GEegE SBJHb CLINTON LIBRARY PHOTOCOPY SECRET- p CC D CT President Yeltsin I believe its been a long time since I have spoken to a member of Congress U The President They might be more likely to do what you want rather than what I want jcf President Yeltsin But I understand it depends on you and your influence with Congress Today I've tried to explain that the major issues depend on a solution from Congress especially the issues that are irritants to many Russians P I don't want to issue a formal invitation tonight at the dinner table and will do so tomorrow But when you come you will see a real difference in Russia It is a country that has felt freedom and civil liberties It no longer helps forty Communist governments abroad not with a single kopek It pursues equitable relations in foreign policy It has sniffed the air of democracy felt freedom I would suggest that once we have left behind all the constraints that have been placed on us it will be not the Soviet Union but a different country We fight sometimes with the Communists but when you label us as Communists we get offended I have already explained our concerns to you You need to meet more people from our team I will pass the floor to Fedorov The President He is young even by the standards of my administration U President Yeltsin He is one of the youngest members of my government but he is close to the age of many Some are younger Our single deficit is that we have no women We have reformers democrats but no republicans U Minister Fedorov I am responsible for finance and development of economic reform without which reform is impossible It is important that all elements of our reform package be supported by the United States and the rest of the world The reforms are in three main directions first the battle with inflation which devalues people's savings bars investment and undermines the economy That is why it is so important to implement a stabilization fund The ruble is the basis of our economic development Success in our fight with inflation will mean that we can move forward with wider economic reforms and restructuring the creation of private enterprises and conversion of the military President Yeltsin I should point out that the program the U S Treasury has outlined contains proposals that serve our needs in health care support for small enterprises and so forth Minister Fedorov It is important to have a clearcut program in the G-7 package so that we have an idea of what to expect this year in the way of support We have a program of private ownership of land social support of the people and restructuring of industry so that we can help the people so that they will not suffer -GEeRET- cu r tl CLINTON LIBRARY PHOTOCOPY bEURrb The President The Secretary of the Treasury has put in a lot of work to help stabilize the economy over and above the stabilization fund President Yeltsin What we need is to pursue a very tough budgetary policy There was a period when we lost control of it and adopted a populist program But now Federov is in control and in pursuit of stability Even in April with these hard times we won't bend jf Secretary Bentsen Mr President I spent the day with your two Deputy Prime Ministers They are very impressive and they represented you well I am particularly impressed by the Federov plan It is absolutely critical to stabilize the ruble We will help if we can It is also essential that you control the Central Bank and the explosion of capital including the expansion of the budget President Yeltsin Unfortunately we have not yet been able to rip the Central Bank from the Parliament But we made its Chairman a member of the government so his duty is to it Secretary Bentsen We share that objective If the Federov plan is put into effect you will stabilize the currency and get the deficit down President Yeltsin Federov is a very tough personality but he is also mild in character But he is tough on the budget so even the pressure of the President won't affect his policies So the President has to support Federov Shokhin and Mikhailov who will get his $800 million for the uranium Secretary Bentsen We accelerated the G-7 meeting in Tokyo to April 14-15 Japan wanted to be host and I am sure they will be a major contributor to the effort when we get through President Yeltsin I know that Bill discussed this with Miyazawa and there seems for the first time in years to be a shift in Japan's policy toward us That is he should not link the territories to our problems The President Sometimes when the Japanese say yes they mean no I hope when Miyazawa says yes he means yes I think they mean yes this time Secretary Bentsen Canada the U S and Russia share a common ocean but also admiration of the rebirth of a nation and the courage of a President that has impressed the rest of the G-7 too They are the major stockholders of the international financial institutions We will see that they participate in the G-7 process as stockholders President Yeltsin As far as I know France and Canada decided to double their share CLINTON LIBRARY PHOTOCOPY -SeGRBT err eo HS-BEURRfrr Secretary Bentsen Yes that's right Secretary Christopher and I will be in Tokyo and will report back to the President We are very optimistic that we'll see some action We are impressed by the privatization of industry We are interested in seeing the restoration of oilfields and of trade We want to help on the stabilization of the currency President Yeltsin As for oil we need approximately $2 billion First we need to restore the level of production and then to raise it Well take for example the proposal made to you to move into new areas of oil and gas sources This requires capital --in the Stochman oil and gas area for example and can be developed only by the U S or Japan Sakhalin can be developed by the U S Japan and Europe So Japan South Korea and the U S can develop these areas Our business people are too modest or too careful in developing that area Take another example -- the gas reserves found by our geologists If I were a young businessman I would start a venture to open up that Stochman area It so happens that we in Russia have a huge reserve of gas and oil and we can share it on an equitable basis Secretary Bentsen I come from Texas We once had more oil and gas than anywhere in the Union We found that what works in Texas can work for you in Russia But you must do something on private property on the uniformity of taxes and on other reforms President Yeltsin after conferring with Shokhin No we have passed the exams for the first grade out of ten in market economics So give us some time with your help to learn You understand that our managers don't have the necessary skills They know only state planning The President The only point we want to make is that we believe we can help much more in energy to help you increase your pipeline efficiency We have also given thought to more assistance in improving the safety of your nuclear power plants I will work on this with the Congress next week If you are interested we can work with you on this and on the Exim Bank $2 billion loan President Yeltsin nodding I understand you Germany Italy Canada said they would do it and they gave up We could raise oil production by twenty percent by improving the pipelines This is a specific and con ete project You can invest your money and get it back ' The President We would like to try and have a detailed conversation with you and to work on it over a three to five year period We believe your greatest opportunity is in energy and we want to make a major effort there President Yeltsin three years '-SfieRfiT You said five years O r No How about two or CLINTON LIBRARY PHOTOCOPY or oi rpmin -SBeSETThe President Even better Two is fine President Yeltsin Absolutely So we know that Well we could raise our production by twenty percent by improving wells and pipelines And if that happens we wouldn't need the $1 6 billion or even three dollars from the U S We could get it by raising production But our technology isn't good enough So you can chastise us but do something I am certain that in five years we will be competing in the arts in jazz in oil and we will catch up with you I am sorry about jazz actually I am not certain about that The President Maybe not in jazz you in your rich culture U President Yeltsin Yes But we need to catch up with We have ballet classical music U The President This afternoon we discussed the possibility of changes in our law on space I told you that I would review your request which I will do But it is clear that in the next two to three years we have economic potential in space and energy You should be able to earn hard currency and be competitive We thought it would be helpful in addition to our economic assistance to establish a Russia-U S Council on Energy and Space My Vice President is an authority on both issues We believe that over the next six months to a year we can put together a range of things to add income to your country It seems it should be organized as an ongoing effort in energy and space Your Foreign Minister Mr Kozyrev mentioned this idea to me and mentioned Chernomyrdin President Yeltsin He is not mentioning the right names decide who will be on this commission The President No not your Vice President mine Nyet both Presidents laughed at this point I will No Rutskoi President Yeltsin Well I believe this matter should be given to Chernomyrdin who knows energy and oil and gas Immediately after my return I will authorize him to deal with your Vice President Secretary Bentsen space pjT Maybe your Vice President should be sent into President Yeltsin For two years for example We will do it The President In the U S we send teachers into space Russia you can send politicians In President Yeltsin Why not I believe we can have the whole team use our Soyuz spacecraft CUNTON LIBRARY PHOTOCOPY SECRET- OCvm fiECRE'r The President I'll pay half the costs if you let me send a few people along p President Yeltsin Granted I do wonder at all the people trying to do harm to Russia We are experiencing difficult times and are at a turning point We are fighting for freedom And at this point there are certain people who try to do us harm However my team is doing the right thing We can fight How about Lukin Is he doing well or should we transfer him The President I want him to work for me he is doing so well President Yeltsin a wiseguy The President He is a wiseguy and he likes to be known as He is representing you very well here President Yeltsin Very well This post is considered more important than any in Moscow We hope your new Ambassador to Moscow will help us greatly especially at this time in the development of our reforms Today we agreed to establish another working group on military and technical issues Grachev will visit the U S in June and we will name the group then Due to your President's proposal we agreed to call each other by our first names It was difficult to start with it U The President Bill means hit in Russian U President Yeltsin In Russian it does mean hit fighting struggling with no result U Boris means The President In my country Bill means he gets hit I have a doctor who says that people should eat lobsters grapes and pears all at the same time every day in order to live a long time Secretary Bentsen says no that if you eat that food it will just seem like you'll live a long time U President Yeltsin I was born in a poor peasant family We had a lot of suffering and hardships But we had a grandfather who lived to 96 He never knew what a pear meant and never saw one He never went to a hospital not once And when he died the pathologist opened him up and his body was in fine condition He just died of old age All those organs ran out of life He was a great grandfather with a heart and a fist U Ambassador Lukin Boris Nikolayevich have you heard about the time when they opened a dead man up and afterward the certificate said Death followed after the opening up of the body U President Yeltsin Now you can see that our Ambassador to your country is growing up U The President The Secretary of State is always very calm He never raises his voice So the other night at a banquet the o6CCRET o r CLINTON LIBRARY PHOTOCOPY 3 XMU 4f l T -SECRET- speaker looked at him and said and yes he's alive U he is eloquent a statesman President Yeltsin I would say that compared to another Secretary of State he is mute U CNN two hours ago reported that the Bosnian Serbs did not accept the Vance-Owen plan Despite the fact that Churkin worked very hard on this they voted against it So we need to talk about this What should we do It is impossible to lift the arms embargo for Bosnia We need to find political measures and a high-level meeting to stop the bloodshed We could send Kozyrev Kozyrev suggested that the UN Security Council should meet with Foreign Ministers participating and invite the Bosnian Serbs M Secretary Christopher Your Foreign Minister and I talked about this at some length today I would suggest that he and I discuss it tonight to reach a common plan 8j President Yeltsin Certainly You should do it U Secretary Christopher We have talked about this for some months and I have found him to be a qood companion It is an impossible problem but we must try J8 President Yeltsin I agree We must support Kozyrev But if he fails in Bosnia and Serbia things will be bad You should not shift responsibility to the Presidents You should act with Kozyrev The President The UK France and Canada were against lifting the arms embargo because they had soldiers there But I feel very badly because the Serbs in Bosnia had access to weapons from the old Yugoslav army But these arms weren't given to the Bosnian moslems We told them to sign Vance-Owen All they did was to lose more ground and people So even though it might make the situation more violent sometimes I think we should have let them fight for themselves President Yeltsin There is too much bloodshed We need another political attempt If we send Kozyrev and you send your highlevel representative we could invite the UN too to try for a political settlement The arms in that area could make for thousands of deaths especially if you know the Moslems The President They kill each other at abandon President Yeltsin Today I agreed with the President about Georgia and I give my word that I will meet Mr Shevardnadze The discussions will be difficult but we have to start somewhere We must start rsonally -- him and me I promised you and I will do it CS The President U Anything else When do we begin in the morning 4 Q CT'Dir CLINTON LIBRARY PHOTOCOPY 0r GBP 10GBP 3 l wMlXJITErr -gseser- President Yeltsin Tomorrow you are the guest at 10 45 a m sharp It's at the Pan Pacific Hotel U The President Thank you U President Yeltsin We will continue the negotiations until the press conference U -GEeRgT- XJlIxnTiirr' CLINTON LIBRARY PHOTOCOPY This document is from the holdings of The National Security Archive Suite 701 Gelman Library The George Washington University 2130 H Street NW Washington D C 20037 Phone 202 994-7000 Fax 202 994-7005 nsarchiv@gwu edu