Publication: Monitor Volume: 2 Issue: 104

In yet another example of Boris Yeltsin’s pre-election courtship of the former Soviet military industrial complex, the Russian president met with some 500 defense enterprise leaders in Moscow yesterday and told them that Russia’s role as a "great power" depends to a large degree on its defense industrial sector. Yeltsin admitted that "many mistakes" had been made earlier in reforming the defense industries, but asserted that the sector is now "receiving support it has never had in all the years of reforms." He called upon the Defense Ministry to boost the ability of defense enterprises to compete in foreign markets and to become an effective source of growth for Russia’s national economy. Quoting figures released earlier by government spokesmen, Yeltsin said that revenues from arms exports were $3 billion last year and that current orders totaled more than $6 billion. He also said that products from Russia’s defense sector were often superior to their foreign analogs and that they had in some cases driven the United States out of foreign markets. (Itar-Tass, Interfax, & UPI, May 29)

In his own remarks to the assembly, however, defense industries minister Zinovy Pak cautioned that a mere 18 out of the defense industrial sector’s 1,700 enterprises were responsible for 80 percent of last year’s arms export revenues. He said that production had fallen by 21 percent in 1995 and that wages for the sector’s more than 3 million workers had fallen with it. First Deputy Prime Minister Oleg Soskovets told the gathering that military hardware now accounts for only about 30 percent of all production in the defense sector, with just half of that total going to Russia’s own military forces. (Interfax, May 29)

…And Addresses Military Command.