Sir: Jeffrey Sachs is absolutely right - up to a point ('The bank that foreclosed on Russia', 26 January). Putting Russia into the hands of banks governed inflexibly by 125 countries, unable to lend except to three-star borrowers, was, as he says, a move to keep Russian aid off Western budgets. But it put Russia in a catch-22. It couldn't reform without our help, but we wouldn't help until it reformed. It is this kind of short- sightedness that produced the Versailles Treaty, and then Hitler.
But financial shock therapy doesn't help in countries brought to their knees by putting 25 per cent of their population, 50 per cent of their industrial investment and nearly 100 per cent of their talent into arms manufacturing.
Don't blame those who run the World Bank. They could, given aid money free of conditions, produce a programme of joint-venture investment capable of turning round Russia's resource-rich real economy, giving it a positive trading balance and making, with all its natural wealth, a dynamic trading partnership that would do for Europe what the opening up of the West did for the United States and Canada.
The money is there. We, too, need to convert our arms industries: Nato last year spent dollars 150bn ( pounds 103bn). If we do not want to lower our guard too early, we should raise an 'arms conversion loan'. The World Bank (unofficially) says that Russia needs dollars 15bn to support the rouble and provide a social-security network; to this the European Parliament has added dollars 5bn for joint ventures, making dollars 20bn.
What better investment to end the Cold War, do away with nuclear weapons, tap Russia's riches for them and for us, and remove the threat of a resentful, nationalist Russian president in charge of the nuclear arsenal. But we are fast running out of time]
MEP for Cambridge and North
26 JanuaryReuse content