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17

Wayne Clifford, Ass't Deputy Minister, International & Intergovernmental Relations

IA Neftegaz.RU: Alberta Province and Khanty-Mansiysk Autonomous Region have signed the Agreement on Friendship and Cooperation in 1996. What are social and economic benefits of 6 years realization of this agreement for KhMA Region and Alberta Province? In your opinion what are the similarities and differences of the given regions (geographical, economic, social parameters)?

IA Neftegaz.RU: Alberta Province and Khanty-Mansiysk Autonomous Region have signed the Agreement on Friendship and Cooperation in 1996. What are social and economic benefits of 6 years realization of this agreement for KhMA Region and Alberta Province? In your opinion what are the similarities and differences of the given regions (geographical, economic, social parameters)?

Wayne Clifford: I think from our perspective in a first two or three years it was quite a bit benefit, it was quite a bit of activity. As you know we have an office in Tyumen city, we spend a lot of time in Surgut, Nighnevartovsk. There are a lot of business interests. Unfortunately in 1995-1996 business interest from Alberta in that region diminished, as there were a number of difficulties. When business diminished consequently the level of governmental cooperation also diminished.

I think mission of Canadian team to Russia led by Prime-Minister is an indication that Canada has renewed its strong interest in Russia. If you look at two countries and the two regions, it makes sense that we will cooperate, that we have a lot in common, that we can both benefit from doing more together.

IA Neftegaz.RU: So the next step will be again office of Alberta province in Tyumen or Khanti-Mansijsk?

Wayne Clifford: I think from the point of view of Alberta business they are still waiting to see how the business climate in Russia evolves. I think it is looking better than 3 years ago but the business community from Alberta is still cautiously interested in Russia and Siberia as they are waiting to see some better indications of certainty, business climate improvements, transparency in legal environment. Even though the business community diminished significantly after 1995 the Alberta government maintains relations in Khanti-Mansijskij because we think this is a temporary problem that Russia was going through and certainly we see the potential in future for cooperation is quite significant, there's a whole bunch of reasons doing business together. So this relationship has a lot of promises and a lot of results today.

The total trade opened 1991 was very, very significant. Russia was always one of Alberta 5 top partners. So we looked at the world, found 5 top countries and Russia was always there. Since then cooperation with Russia has weakened partly because wheat sales declined, also because of difficulties in oil and gas sector. So for now more trade should be done both ways, we should buy more Russian products and Russia should buy more ours. We need to reestablish that trading relationship. I think that's the team Canada mission was focused on, is how we build that natural partnership.

IA Neftegaz.RU: Talking about the political situation, do you see any changes in the government relations, with Putin's election?

Wayne Clifford: Yes, I think everybody in the west sees establishment of fairly steady hand in Russia as an important development. You know, some in the west think Mr. Putin could be more democratic, but there are many in the West who say that for the state development of Russia you need firm hand, you need some clear leadership and we see that in Mr. Putin. I guess we can only hope he's able to bring both economic and political reforms and certainty. When business and investments are coming in, there should be the same rules that will be applied to every partner. Only then they will invest.

IA Neftegaz.RU: Recently the United States recognized the Russian Federation as a "market economy", and it is likely that the European Union will do the same within the next few months. Do you think that such decisions by the world's two largest economies will impact on the way that the Alberta Province sees Russia? Does the Alberta Province see Russia as an equal trading partner?

Wayne Clifford: It's a significant development that Russia is a full partner of that very prestigious economic gathering, GATT. And I think for Alberta it is very important that Russia has these steadies, I think it will help in terms of attracting investment from Alberta, that's an indication that Russia is graduating to full economic partnership with western economic powers. I guess the other step very important is Russia's WTO accession, that's probably the other important step that investors will be looking at.

IA Neftegaz.RU: The anti globalization movement has been particularly strong in its voice over the past few years? In the run up to the G8 Summit did you ever envisage that the movement could pose a serious threat to the leaders of the world's most powerful nations?

Wayne Clifford: They were much smaller than we anticipated; we had perhaps 2500 people maybe 3000 on one of the days. And there was no violence, there were no smashed windows even, that's amazing. Part of that I think was a very good planning between federal governments and the city of Calgary.

IA Neftegaz.RU: Which countries and regions work with Alberta Province on the similar basis and what are results and prospects of similar agreements?

Wayne Clifford: Well, we look around the world, we look particularly at regions, provinces, states, oblasts that have similar economic indicators as Alberta, regions that have oil and gas based economy, or strong agricultural base.

Another indicator of cooperation is Northern focus, Northern part of the world, we face the same challenges: how to build pipelines in minus weather. So those are the factors we're looking at. We have about 12 countries, provinces around the world that we twin with. Most of them have a Northern focus or oil and gas focus. With the couple of them we just do because it's good, for example the South Africa, or number of provinces of Africa. We were assisting them to set up provincial administration.

IA Neftegaz.RU: What are the difficulties in cooperation with KhMAO?

Wayne Clifford: I suppose the main one is the distance. It's easy to get from Moscow to New-York. It's much more difficult to get from Edmonton to Toronto then to Moscow then to KhMAO. So the remoteness of both of our regions means it's difficult to have communications.

In early 1990s Alberta companies were very active in KhMAO. We were going from Calgary to Nighnevartovsk at least once a week carring the work with back and forward. Because we had some operates with people from Alberta who were working in KhMAO. So distances fairly affect, languages obviously a problem and pleased to see more and more people in Russia speaking English, ashamed that not so many people from our side are speaking Russian.

We keep people telling you need to learn other languages, but every one's learning English. But I must say we have a new strategy, new international education strategy, one of the key plans is to increase the learning of foreign languages in our schools and universities.

So that's one of the difficulties in communication. I guess the other one for us in dealing with the Russian regions is that your system is so rapidly different, because you have basically a communist system having the market economy. Very often we find Russian side thinks we, the government, can tell the companies to go and do things. But we can only very cautiously suggest things. So that's often one of the difficulties in communicating that we always have to address at the beginning to make sure that our Russian partners understand that the role of the government of Canada in someway limited comparing with the old model in Soviet Union.

IA Neftegaz.RU: What are the perspectives of cooperation between Russia and Canada?

Wayne Clifford: First of all on oil and gas equipment side I'm sure there are still products being produced in Alberta that would be of interest to your oil and gas industry. I'm sure there are still products that we can ship there.

In terms of producing products in Russia there maybe companies who are interested in licenses and arrangement to actually produce the equipment over there.

On a services side I know there are lots of activity but this area is always unreported. We maybe doing more businesses in services area than in a goods area, it just doesn't show the statistics.

What can we do to create more trade between the two is to find products that Russia can produce and ship here.

I know back in the 80-s there were number of joint ventures between Canada and Russia, they were buying things such as tractors made in Russia and exported to Canada. For a period of time there were a lot of cars being exported to Canada. But I guess from the Russia perspective you need to find those market niches, those particular areas where you have a competitive advantage or you can produce something that is unique that will make it saleable in Canada. It takes many years and it takes some creative entrepreneurship to find those products. But I think we also understand that any relationship needs to be two ways. In our interest to help you find those types of products, to find those areas where you can export to us because trade has to be two ways.

IA Neftegaz.RU: Aboriginal population...

Wayne Clifford: The Stampede is a very good example of activity of aboriginal population. The Stampede born in Calgary has taken the Calgary Stampede to Hong-Kong. Two years in a row they've taken it there. There you can see a large number of people and some of them are with their horses and chap-wagons. It is quite a productive as it is paid for by Hong-Kong side as they celebrate Chinese New Year at this time and they want have a big spectacle. So some of the Hong-Kong entrepreneurs who have investments in Canada and some of the companies have got together and make a deal with the Calgary Stampede board, bringing Stampede to Hong-Kong. So if there is something similar that is of interest of Khanti-Mansijsk and if they are able to make an arrangement with Stampede board that could happen. Another aspect we have aboriginal rodeos in the province, you know some of the top rodeo stars in Alberta need people, aboriginals. So they make some interest possibly there. The main issue of those exchanges is that they are very expensive. So it's also a question of finding the funds to make those intergovernmentaly within the Canada.

Source : Neftegaz.RU