30 



American farmer or commodity or marketer or whatever and let 

 the individuals decide on their own what kind of risk there is and 

 whether it's something they want to assume without us being so 

 regulatory in that process that you take that flexibility. 



I don't think we can guarantee a risk-free society even here in 

 this country, and I would hope that we wouldn't do that, because 

 I think our markets would develop much faster if we can leave it 

 up to individuals and try and expedite that. 



Mr, Kauzlarich. I would agree with you. I think the more you 

 can encourage that kind of contact, the better. But I know in our 

 contact, with American business people in particular, they come to 

 us with the same set of problems — the lack of predictability in 

 terms of who can sign contracts on the Russian side and the very 

 concept of ownership itself, the lack of a tax system that you can 

 say from one day to the next isn't going to change, the need for 

 some sense of relationship between local and federal-level officials 

 in Russia. 



If we can help in that area, I'd like to do it, but as much as pos- 

 sible stay out of the way of the contacts that are so important on 

 the person-to-person level, which are obviously the ones that are 

 going to be most likely to bring success. 



Mr. Allard. Thank you, Mr. Chairman. 



Mr. Penny. Ms. McKinney, do you have any questions for this 

 witness? 



Ms. McKinney. I do have a few, Mr. Chairman. Thank you. 



Really, the first question is in response to something you said 

 about Representative Glickman's bill, and I'm just wondering, has 

 the creditworthiness of Russia already been negatively impacted 

 because of this arrears? 



Mr. Kauzlarich. [No audible response.] 



Ms. McKinney. It has been. Would, Mr. then, Mr. Glickman's 

 write-down proposal add to that negative stain on their credit- 

 worthiness rating? 



Mr. Kauzlarich. Well, that's almost a question that you'd have 

 to ask a commercial banker in terms of how they would interpret 

 that kind of development. I think our objective has been to try to 

 get Russia in the position where it can service the debt that it has. 

 Once that's done, if the credit markets look at a country, even 

 though it may have a large amount of debt, if it's servicing that 

 debt, then they're going to be prepared to lend. 



I think we ought to focus on the objective here, and, at least in 

 our view, the objective is to get Russia to the point where it can 

 come back into the credit markets for this and other purposes as 

 a full participant. As I say, I think that's where the distinction is 

 between what was suggested earlier and what I described as our 

 approach toward debt rescheduling. 



Ms. McKinney. Then do you or do you not believe that this pro- 

 posal that is before us is a way to bring Russia back to credit- 

 worthiness? Is that a viable way? 



Mr. Kauzlarich. Well, again, I'd like to study it a little more 

 carefully, and, as I say, there are a number of other agencies who 

 may have even more precise views on some of the issues you've 

 been addressing. I just would not feel, at this point, able to give 



