G-7 Gives Yeltsin More and Less Than He Wanted : Diplomacy: Russia’s leader got more respect and more aid. But if he wanted to be treated as an equal, he fell short.

Pushing the world’s richest nations hard for increased foreign trade, Russian President Boris N. Yeltsin on Friday got billions in additional aid instead. He expressed gratitude, but also regret.

“The biggest disappointment I have from the meeting is that to my energetic calls came the reply: ‘Yes, yes. It’s hard. We’ll have to solve those problems,’ ” Yeltsin said dryly after he met with President Clinton and the rest of the Group of Seven leaders.

“Russia vitally needs integration into the world economic system,” he insisted.

What Yeltsin did get at the G-7’s annual economic summit here was the $3 billion in aid to Russia’s struggling privatization program that Clinton had lobbied other Western nations hard for.

“We are happy to see the results being achieved in Tokyo and the atmosphere of cooperation. This is a new step on the way to a ‘new world order,’ ” Yeltsin told a press conference.

But 18 months after the demise of the Soviet Union, that new order does not yet include Russia’s participation as an equal with its former adversaries in what has been called “the world’s most exclusive club.”

“To be fair to all the people who are here, there was really no serious discussion of that,” Clinton told reporters at a news conference Friday evening. “But for the first time, President Yeltsin was invited to come next year before he ever even made a statement.”

That meeting, which will be the third G-7 summit to which Yeltsin has been invited, will take place in July, 1994, in Naples, Italy. Russia’s leader will again go as a guest, not a member.

“I’m not in a hurry,” was Yeltsin’s reaction. “Time is working for us. We’ll get to be the ‘Big Eight’--give or take a year.”

Although some of the leading industrial countries have grave doubts about the course of Yeltsin’s campaign to break the back of Soviet-style government economic management and replace it with a free-market system, the leaders were unanimous in hailing Yeltsin’s “courageous reform efforts” in their communique.

“Welcome to our table,” Japanese Prime Minister Kiichi Miyazawa told Yeltsin as the two shook hands in Tokyo’s government guest house, a mini-Versailles that was the locale of the three-day G-7 meeting.

Summit documents and comments from G-7 leaders made clear, however, that their continued backing is linked to the economic performance of Yeltsin and his government, because that is precisely what determines whether aid approved by the G-7 has the desired effect.

“Reducing inflation and high budget deficits must remain a priority,” German Chancellor Helmut Kohl said.

The leaders of the United States, Germany, Japan, Britain, France, Italy and Canada endorsed a $28.4-billion package of assistance that had been assembled by their foreign and finance ministers here in April. And to Yeltsin’s delight, they approved the new $3-billion fund, championed by Clinton, specifically designed to help inefficient, bloated state-run enterprises bequeathed by Soviet communism make the transition to competitive, privately owned ones.

Yeltsin proudly noted that unemployment in Russia is now only 1.5%, a fraction of what many Western countries now suffer. But as his reformist government slashes the subsidies that have kept thousands of factories grinding away, producing goods that few people buy, he faces an explosion of joblessness.

Ideally, those plants can now be restructured with the international aid funds to make goods that consumers actually want and to keep Russian workers on the job, thereby preventing yet another motive for social or political unrest.

But Yeltsin also came to Tokyo to urge a commitment by the G-7 to end restrictions dating back to the Cold War on Russian-produced goods. It is a potentially explosive issue in Russia, where many disillusioned citizens feel the West was happy to witness the fall of communism but has done little to boost democratic and market-oriented change.

“I spoke in quite serious terms about the question of discrimination in trade,” Yeltsin said.

The G-7 communique did promise efforts “to adapt export controls” that had been designed to limit Soviet military access to high technology, and it recognized that improved market access abroad for Russian goods is important. But that language was too tepid for Yeltsin.

“It’s time to end all this,” he said.

The topic was on the agenda again when Clinton met Yeltsin for a working breakfast today at the U.S. ambassador’s residence.

“As I have said to the American people from the very beginning, an investment in Russia’s future is good for the American people, as well as the Russian people,” Clinton said at a brief news conference held in the residence’s Japanese garden.

He said he believes his efforts to prod Congress to remove many of the “obsolete Cold War restrictions” that Yeltsin objects to will yield results this year.

Some Jewish groups in the United States object to lifting the so-called Jackson-Vanik Amendment, which links most-favored-nation trading status for Russia to freedom of emigration, on grounds that hundreds of Jewish refuseniks are still unable to leave.

Clinton said he and Yeltsin “have made an agreement about how we would proceed,” and held out hope for progress.

Clinton also said that he has accepted an invitation from Yeltsin for a U.S.-Russian summit in Moscow, perhaps this year.

“I think that our partnership and our friendship is strengthening day by day and this is, indeed, the guarantee of further developments and progress,” Yeltsin said at the joint news conference.

British Prime Minister John Major, who had a working lunch with Yeltsin on Friday, endorsed his appeal for more open international markets but said Russian practices also must change.

“The objective, not obtainable in the short term, must be free trade with the rest of the world,” Major told reporters. “But the restructuring of the Russian economy has some way to go before this can be made possible.”

One major hurdle, Major said, is Russia’s enormous subsidies on some raw materials such as oil, which sell at levels far below world prices, giving Russian exporters or producers greatly reduced costs.

The Russians’ reservations about certain types of aid from Japan and its Western allies arise from last year’s Group of Seven summit, held in Munich, Germany.

“Serious decisions” often were not implemented, Yeltsin complained.

It did not escape the Russians that some of the money approved this time under the privatization program must be used to buy goods manufactured in the donor countries, and a full $500 million is “technical assistance,” most of which customarily ends up in the pockets of international consultants.

On the whole, Yeltsin said he was happy with the way he was treated at Friday’s talks, apparently contrasting them with his appearance at Munich last year.

This time, Yeltsin said, amid laughter by reporters, “it wasn’t a row of teachers sitting at desks and the schoolboy walking in and being browbeaten about every subject.”