Statement by H.E. Ambassador Vasily Likhachev, Permanent Representative of the Russian Federation to the European Union

Dear Mr.Chairman,

Ladies and Gentlemen,

We consider today's conference as an important and timely international gathering. We believe it is called to concentrate efforts of the international community on rendering genuine financial and technical assistance to Macedonia which is going through a difficult period of searching for solutions to its problems.

The political forces in Macedonia encouraged by a active international mediation managed to set off on a path leading out of the crisis imposed on the country. The Framework Agreement of August 13, 2001 established basic parameters of the settlement.

The authorities of the Republic of Macedonia are fulfilling their obligations under the Agreement. A significant part of the way has already been covered in the direction of full implementation of the Agreement. That confirms that there is no alternative to a political settlement.

We believe the international community will carry on with any kind of support to Macedonia in preservation of its territorial integrity and sovereignty, unitary structure of the Macedonian state as well as in complete normalization at the earliest of the situation and restoration of the constitutional law all over the country.

Unfortunately there can be no conflict without negative implications for a country's socio-economic development. The hardships of the transitional period are further compounded by problems related to destruction of infrastructure and housing, by need to care for a considerable number of the internally displaced persons. Despite doing their best the Macedonian authorities will unlikely be able to cope with all the problems before them single-handedly.

Russian Federation continues providing some economic assistance to the countries of SEE including Macedonia mostly on bilateral basis. My country is an old and tested trade partner of Macedonia: Russia comes the 5th in total volume of Macedonian foreign trade and 3rd in Macedonian import.

At the end of last year Russian and Macedonian Governments declared their mutual intention to intensify bilateral cooperation in various spheres the potential of which still is to be used fully and efficiently. An action program has been outlined aiming at solution of some practical tasks. Quite promising and therefore very urgent is the cooperation in the power sector - underpinning branch of the economy.

Prospects for this cooperation are backed by the fuel and power facilities constructed in the past with Russia's support and technical assistance. There are also some good outlooks for development of the gas network in the Republic of Macedonia and the major industrial enterprises of the country starting using natural gas from Russia.

As regards energy and electricity, we study possible participation of the relevant Russian organisations in reconstruction and modernisation of existing hydro and steam power plants as well as in building new electric power plants. A major Russian company "RAO UES of Russia" has already leased NEGOTINO steam power station which is going to be reconstructed.

In order to balance the bilateral trade and increase the volume of Macedonian export to Russia Macedonia has been granted a preferential regime which reduces customs tariffs by 25%. It has been also agreed to prepare a free trade agreement between Russia and Macedonia.

We hope that such an assistance from the Russian side will to some extent contribute to overcome the complex economic situation in this country. We are ready to co-operate with international organisations and financial institutions in matters of economic recovery both of Republic of Macedonia and the region as a whole. At the same time it is a common understanding that political stability is a major prerequisite for economic recovery.

The situation on the Balkans remains very complicated and requires permanent attention of the international community. We're convinced that a system approach is indispensable to avoid an arbitrary altering of state borders in the region as well as to rebuff timely and properly any act of terrorism.

Russia intends to continue working for reaching durable and just settlement and normalisation of the situation on the Balkans on the basis of the joint decisions of the international community as well as to encourage creation of atmosphere of peace, accord, mutual confidence, stability and good-neighbourliness in the region. We reiterate Russia's initiative to convene a Balkan summit with international participation in order to elaborate legally binding agreements between countries of the region.

Thank you for your attention.