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EX-SOVIET UNION A FERTILE MARKET

The 12 New Independent States that now comprise the former Soviet Union represent the largest untapped pool of consumers left in the world - a market too big and important to be ignored by this country's government or business community.

That's the assessment of Ambassador Richard L. Armitage, named last March as the U.S. coordinator for emergency humanitarian assistance to the Russian Federation and the 11 other new nation-states that have been formed since the collapse of the Soviet Union."These are intelligent and cultured people and they want things," said Armitage. "We consider ourselves a humanitarian nation, but that doesn't take the place of self-interest. If we give the New Independent States economies that are healthy, it will generate new business for us."

To help boost that effort, Armitage has directed his assistant, David M. Hatcher, to hold a series of "executive briefings" in cities across the country to acquaint local business leaders and entrepreneurs with what the government is doing to help them do business in Russia and the other New Independent States (NIS).

Armitage and Hatcher spoke with the Deseret News in a telephone interview this week.

The briefing team will be in Ogden Oct. 7 and in Salt Lake City Oct. 8. It will include experts from the Department of State and the U.S. Agency for International Development (USAID) as well as local co-sponsors. A group of professors from Moscow State University will also be on hand. Attendance is by invitation.

"Our goal is to give all those who attend the briefings the most current information on how their business, nonprofit organization, or private voluntary group may discover and develop an opportunity previously unknown to them," said Hatcher.

A number of large U.S. corporations are already doing business in Russia and some of the other states - McDonald's and Monsanto are two of the most visible - but small entrepreneurs may actually find it easier, said Armitage, noting that one entrepreneur has started 13 separate businesses there.

Although the program offers assistance to all 12 states, Russia is receiving about 65 percent of the U.S. effort with the other 11 states sharing the remaining 35 percent. It's not favoritism, just reality, said Armitage.

"If the Russian Federation doesn't make it, none of the others will. Think of it this way: If the Russian economy were to grow at only a 4 percent annual rate, the entire global economy would be boosted 1.8 percent in GNP. That's how big it is."

But Armitage doesn't want to oversell Russia and the other states as a source of new markets. For one thing, until the ruble becomes a fully convertible currency, U.S. companies will have to continue doing business there with what amounts to a barter system.

"This will be a long generational journey. It won't be solved in five years," he said. "There will be times of greater and lesser progress."

Still, Armitage believes the general course is set. "These are cultured and educated people, and I don't see them returning to communism. They may not know exactly what they want at this point, but they know what they don't want: what they had."

Armitage stressed that the program to provide assistance is not foreign aid as such, nor is it some grand new Marshall Plan.

"The funds aren't available for that and that isn't what they need anyway," he said. "It's not like Europe after World War II in which the entire infrastructure needed to be rebuilt. The NIS already have rails and highways and bridges. What they don't have is management expertise."

Hatcher said the Utah Manufacturers Association has received some 50 invitations to the briefings.