Alaska has many connections with the Russian Far East and is actively pursuing more ties in various areas. Alaska's links to the Russian Far East range from aid to trade, from exports to imports, education and culture, transportation and communication, political and practical, tourism and travel, and exchanges of all kinds. Many millennia after the Bering Land Bridge has vanished, Alaska is working to build bridges of all kinds linking Alaska to the Russian Far East.

Alaska - Russian Facts

• Alaska and Russia share a border. The U.S.-Russian maritime boundary zigzags down the Bering Strait between the Asian and American land masses.

• Alaska and Russia are less than 3 miles apart at their closest point in the Bering Strait where two islands, Russia's Big Diomede Island and Alaska's Little Diomede Island, are located. In winter it is possible to walk across the frozen Bering Strait border between these two islands. At its closest, the American mainland and the Russian mainland are 55 miles apart where Alaska's Seward Peninsula and Russia's Chukotka Peninsula reach out to each other.

• Cities and towns in Alaska and the RFE are closer to each other than they are to their own national capitals.

• Russia governed Alaska as a colony for almost as long as the United States has now governed Alaska as a territory and state.

• Alaska has two official state holidays: Seward's Day, the last Monday in March, commemorates the 1867 signing of the treaty in which U.S. Secretary of State William Seward agreed to purchase Alaska from the czar; and Alaska Day, Oct. 18, which marks the formal transfer of Alaska from Russia to the United States in the Russian capital of Sitka.

• Alaska has many historic Russian buildings. There are active Russian Orthodox Churches in some 80 Alaska communities, many of which still use the old-style Russian Orthodox calendar and celebrate Christmas on what is marked as Jan. 7 in Western calendars.

• Many of Alaska's native peoples who lived in the regions colonized by Russia have Russian surnames, stemming from the days when they were colonial subjects of the czar and many intermarried. Russian names mark Alaska's geographical landscape.

• Russian Orthodox "Old Believers" who emigrated from the Soviet Union have their own old-style Russian villages in Alaska.

• Except during the Cold War, Alaska and Russian natives on either side of the Bering Strait carried on with routine visits, seasonal festivals and subsistence trade.

• During the Cold War, Alaskans referred to the closed border between Russia and Alaska as the "Ice Curtain." Their goal: to melt the Ice Curtain.

• The University of Alaska has more Russian students at its campuses than any other university in the United States.

• Much of the flora and fauna and geology in Alaska are similar to the Russian Far East and eastern Siberia.

• Alaska serves as the U.S. gateway for all flights between the Russian Far East and the United States.

Alaska - Russia historical milestones and timeline:

www.dced.state.ak.us/trade/russia/timeline.htm

Alaska -- Gateway to the Russian Far East

• Alaska has been the gateway for weekly roundtrip flights between the United States and the Russian Far East since the inception of air travel between the regions.

• Mavial /Magadan Airlines has scheduled weekly service from Anchorage to Magadan via Petropavlovsk-Kamchatsky, with connections to Vladivostok, Khabarovsk and other cities.

• Bering Air flies frequent charters – about 150 per year -- across the Bering Strait between Alaska and Chukotka, primarily between Nome and Provideniya. Empty seats on these charters are sold on a space available basis. A bilateral agreement reached in April 2001 permitted U.S. carriers to apply for scheduled service to Chukotka for the first time, and Bering Air has indicated that it intends to do so.

• Evergreen International Airlines has announced plans for combination passenger-cargo service to Sakhalin starting in the first quarter of 2002. Flights between Anchorage and Sakhalin on Reeve Aleutian Airways ended in December 2000 when Reeve ceased all operations.

• Unlimited Russian charters are permitted between Alaska and the RFE.

• Scheduled and charter cargo service between Alaska and the Russian Far East is available on passenger flights, from cargo carriers and through freight forwarders.

• Alaska is strategically located to serve as a staging area for companies doing business in the Russian Far East.

• Alaska is the jumping off point for adventure tourism to Kamchatka, Chukotka and elsewhere in the RFE.

Needs Updating -- For details on flights between Alaska and the RFE, flight schedules, flight routes and airline contact information:

www.dced.state.ak.us/trade/russia/flights.htm

For companies considering Alaska as a gateway to the RFE, as a staging area for RFE developments or business or an offshore base for RFE operations:

www.dced.state.ak.us/trade/russia/whylocate.htm

• The University of Alaska Anchorage operates the American Russian Center (ARC) in Anchorage with branch campuses in Magadan, Khabarovsk and Yuzhno-Sakhalinsk. New training initiatives and expanded outreach efforts involve programs in Kholmsk, Petropavlovsk-Kamchatsky, Komsomolsk, Blagoveshchensk, Chita, Birobidzhan and Ulan Ude. ARC specializes in teaching business to Russian government officials, entrepreneurs and business representatives. In addition to its Alaska and RFE training for Russians, ARC provides various business support and technical assistance.

• The University of Alaska Mining and Petroleum Training Service (MAPTS) has trained many Sakhalin oil field workers in Alaska and Sakhalin for jobs in the oil and gas industry in Sakhalin. MAPTS is a co-founder (with Peak Oilfield Service Co. and the Sakhalin branch of the Russian Academy of Sciences) of Sakhalin Alaska College, based in Yuzhno-Sakhalinsk. The college was established to train workers for Sakhalin resource development projects utilizing state-of-the-art Western equipment and helping the industry on Sakhalin meet its Russian content requirements.

• Russian students from throughout the RFE study at University of Alaska campuses in Anchorage, Fairbanks and Juneau. The UA boasts more Russian students than any other university in the United States. Russian students from regions or cities that have sister relations with Alaska are granted a tuition discount, allowing them to pay in-state tuition rates instead of higher out-of-state tuition charged other non-Alaskans.

• University of Alaska campuses teach Russian language and have conducted exchange programs with Russian universities in the RFE.

• Alaska Pacific University and other Alaska educational institutions are also involved in projects, exchanges and activities with the Russian Far East.

• Alaska high schools have Russian programs and stage a Russian academic Olympiad every spring. Alaska high school students and teachers have participated in exchange programs with the RFE. One of the largest single programs occurred in May 2001 when 50 Chukotka students and teachers journeyed to Anchorage to learn English and to engage with their Anchorage high school peers. Nome has had regular exchanges with Chukotka.

• The Anchorage School District's Civitas program has brought a nationwide civics education program to Sakhalin.

• University scientists conduct various exchange programs with their Russian counterparts at RFE universities and the Russian Academy of Sciences Far Eastern Branch.

For more information on the University of Alaska Anchorage American Russian Center: www.arc.uaa.alaska.edu/arc

Alaska - RFE Trade

• The Russian Far East has been an important trading partner for Alaska.

• Alaska commodity exports to Russia totaled $10 million in 2000 – three times the 1999 export figures but far below Alaska exports for the previous five years.

• Alaska exports to post-Soviet Russia reached an all-time high in 1996 at $106 million and hit a post-Soviet low in 1999 at $3 million, following the August 1998 ruble devaluation (the rubles lost 75 percent of its value) and subsequent financial crisis.

• Alaska exports to Russia include ores, machinery, oil field tools and equipment, seafood, oil products and consumer goods.

• Among Alaska’s most important exports to the Russian Far East are services, such as oil field services, environmental services, engineering, technical services, and other services generally provided to the natural resource development industry. The value of services is not included in the value of export commodities. Therefore, the true value of Alaska's business with Russia is actually far greater than the commodity export data indicates.

• Alaska imports from Russia include petroleum products; king crab; crafts, art, jewelry and souvenirs; gold; scarves, cloaks and hats. Alaska imported Russian goods estimated at between $8.2 million and $11 million in 1998, a substantial increase over the previous three years when imports totaled about $3 million annually.

• Another element to the Alaska-RFE economy involves the financial benefits of flights and visitors using Alaska as the gateway to the RFE. Exchange projects and active training programs all bring economic benefits to Alaska that are not measured in the export commodity statistics.

• Alaska companies have focused on serving the RFE resource industries, especially the emerging oil and gas sector in Sakhalin and the RFE mining industry.

• Major Alaska markets: Sakhalin, Magadan, Kamchatka, Sakha and Chukotka.

Alaska-Russian trade statistics:

Alaska exports to Russia, 1989-1998: www.dced.state.ak.us/trade/russia/exportvalue.htm

Alaska imports from Russia, 1994-1998: www.dced.state.ak.us/trade/russia/imports.htm

Alaska import detail, 1998: www.dced.state.ak.us/trade/russia/imports98.htm

Alaska - Sakhalin - USAID Projects

The U.S. Agency for International Development has granted more than $1 million to the Alaska Dept. of Community & Economic Development, Division of International Trade & Market Development, for Sakhalin projects since 1997. Alaska's Sakhalin projects have grown out of the efforts of the Alaska Sakhalin Working Group. USAID has also funded the University of Alaska American Russian Center and other Alaska public and private sector development projects for the Russian Far East. Regions of the Russian Far East often look to Alaska as a model, and thanks to USAID assistance, Alaska has been able to play a role in RFE development. Alaska and USAID share a common goal in seeking to promote the RFE transition to a market economy, strengthen democratic institutions and develop lasting partnerships in many areas. USAID-funded Alaska-Sakhalin projects have included the following:

Sakhalin Development Agency

Establish a development bank on Sakhalin, the Sakhalin Development Agency (SDA), modeled after the Alaska Industrial Development & Export Authority (AIDEA). This project, funded by two grants, and with contributions from the private sector and the Sakhalin administration, will create a unique financing agency that, if successful, could serve as a model for other regions of Russian. Other RFE regions have already expressed interest in replicating this project. SDA was featured at international conferences in Washington, D.C. and Moscow, "Sakhalin Infrastructure Development in the 21^st Century" – two of the three featured projects were Alaska-based projects.

SDA is designed to fund infrastructure development projects on Sakhalin, provide project financing, loan guarantees, bolster the commercial banking structure, foster foreign investment and export-import trade, and generally bring a measure of financial stability to Sakhalin through a kind of agency unique to Russia.

For more information, contact Project Director Jim McMillan at AIDEA, 907-269-3000 or: jmcmillan@aidea.org

For an overview of the project, see article, "Sakhalin Development Agency modeled after Alaska Industrial Development and Export Authority" available from: www.dced.state.ak.us/trade/russia

Sakhalin Alaska College

This technical training school was designed to offer Sakhalin workers training in skills needed by the emerging oil and gas sector on Sakhalin for the resource development projects. The college was established as joint venture of the University of Alaska Anchorage Mining and Petroleum Training Service, Peak Oilfield Service Co. of Kenai, Alaska, and the Special Research Bureau of the Russian Academy of Sciences Far Eastern Branch on Sakhalin.

One grant provided funding for transforming unused facilities in Yuzhno-Sakhalinsk into a training center and for equipping the renovated facility for classroom instruction and technical training. A second grant provides financing for a workforce needs assessment that will determine how to supply the Sakhalin oil developments with skilled workers. The college, working with industry and government, is assessing how many workers with needed skills are available, how many must be trained and certified and where the workers will come from. This is designed to make sure there is an adequate supply of trained workers to meet industry needs for their development schedules, which will further help companies meet the Russian content requirements. It gives the college the information it needs to implement a training program. This will help Russian and Western companies, government agencies and the work force itself.

Hundreds of students have already been trained both at the Sakhalin college and in Alaska. The college's first graduating class went to work for Sakhalin Energy, which produced Sakhalin's first offshore oil in July 1999.

For more information contact Dennis Steffy, President of Sakhalin Alaska College and Director of the Mining and Petroleum Training Service: 907-262-2788, fax 907-262-2812, mapts@alaska.net

For an overview of the project, see article, "Sakhalin Alaska College" available from: www.dced.state.ak.us/trade/russia

Airport Operations and Management

This project allowed Alaska to provide expertise and training in airport management, focusing on reforming Yuzhno-Sakhalinsk International Airport operations for transition to a market economy. Aviation and airport specialists from the Alaska Division of Aviation, the Alaska Region of the Federal Aviation Administration and the private sector offered their expertise to their Sakhalin counterparts. Seminar topics included financial management, revenue sources, leasing, land and facility ownership and management issues, safety, cargo, customs, passenger facilities, physical plant, and many other topics. Other RFE regions have requested the project, and there is a proposal pending to conduct a broader program of seminars elsewhere in the RFE.

Legislative Development

This project has involved translating Alaska government documents and legislation into Russian for the Sakhalin Oblast administration and the Sakhalin Duma. Documents have also been provided to other RFE regional dumas. Among the documents translated into Russian: the Alaska Constitution, guide to the budget, Permanent Fund enabling legislation, natural resource land use legislation, the division of powers and governmental organizations, and various law of interest to Sakhalin. The grant also provided interpretation services for seminars in which Alaska and Sakhalin legislators discussed issues such as arbitration, government jurisdictions and many other aspects of the democratic process.

Ecological Assessment

This project provided classroom and field training by biologists instructing Sakhalin biologists in methods employed in Alaska for wildlife data collection, particularly seabirds and marine mammals. This focused on work in critical habitat areas subject to oil and gas development impacts.

Environmental Management

Sakhalin has turned to Alaska for assistance in developing a Sakhalin environmental regulatory management regime. Alaska's fundamental policy of "Doing Development Right" serves as the foundation of a project in which development projects must be pursued with environmental protections as an integral part of the developments. This requires a regulatory regime in which the interests of government, industry, citizens and all stakeholders are protected and made compatible. This project is part of an ongoing series of environmental cooperation and exchange programs between Alaska and Sakhalin.

Most recently, in April 2001, a nine-person Alaska delegation – representing Alaska state and federal agencies, the private sector and a NGO citizens stakeholder/watchdog group – conducted a week of seminars in Yuzhno-Sakhalinsk on the Alaska model of environmentally sound resource development and regulation. Plans are being made for a follow-up seminar in Sakhalin. In April 2000, the Alaska Sakhalin Working Group arranged funding for Sakhalin specialists to come to Anchorage and Prudhoe Bay for an Oil & Ice Symposium.

Fund for Future Generations

This project uses the Alaska Permanent Fund as a model for creating a similar Sakhalin Fund for Future Generations. The project addresses the competing issues of spending for current needs versus saving for future needs. The project offers a review of Alaska state agencies that fund project developments, sell bonds to raise money for local governments, and address the economic public policy goals as well as save resource revenues in the Permanent Fund, which also pays for the future.

Other Projects

The State Department, USAID and other federal grant agencies such as the U.S. Information Agency (USIA) have funded additional Alaska projects in recent years, including the following:

• University of Alaska's American Russian Center operations

• Central Asia delegation from Turkmenistan and Kazakhstan to focus on Alaska's oil development and environmental protection.

• Exchange programs involving Sakhalin finance officials, RFE tax and customs officials and business representatives.

• Republic of Georgia delegation visited Alaska to learn about Alaska's resource revenue management regime.

• Northern Economics' Sakhalin Infrastructure Development Plan.

• Russian Leadership Program.

• Chukotka development and technical assistsance project.

• Media exchanges

• Alaska gets frequent requests for assistance from RFE regions; because the state has no foreign aid agency, it must turn to grant agencies for funding for worthy projects.

RFE Working Groups

The Alaska Sakhalin Working Group was created to foster trade between Alaska and Sakhalin, resolve common problems and serve as a forum for dealing with Alaska-Sakhalin issues. Members are appointed by the governors of Alaska and Sakhalin and work with committees on Finance, Transportation, Communication, Education and Training, Legislative, Energy and Ecology, General Business and Construction. The group and committees meet on an as-needed basis during delegation visits and to pursue projects. Alaska-Sakhalin USAID projects originated with the working group.

An Alaska Chukotka Working Group is in the formative stages, following through on a request from the Chukotka administration to have a working group be a mechanism for region-to-region projects and communications.

Other RFE regions have also approached Alaska about using the working group mechanism to facilitate bilateral rergional activities.

Alaska is one of the most active regions in the West Coast-Russian Far East Ad Hoc Working Group, which is comprised of four Western States including Alaska and a dozen RFE regions. The AHWG is a regional trade-oriented organization that is an offshoot of the original Gore-Chernomyrdin Commission formed in the mid-1990s as the Joint Commission on Economic and Technological Cooperation, U.S.-Russia Business Development Committee. The group has 10 industry sectors, plus legislative and training sectors, and Alaskans play key roles in many of these sectors. Alaska has often had the largest U.S. delegation at the AHWG meetings, which alternate between the West Coast and RFE regions. Alaska hosted a meeting in 1996 and will host the 7^th annual AHWG meeting in May 2002.

An arctic policy working group that meets in Anchorage, largely as a local advisory group on Arctic Council-related issues, has a RFE element to its work.

RFE Mining

The geology and mineral resources in Alaska are similar to the Russian Far East.

Mining companies operating in Alaska and the service companies that support the mining industry are well-positioned to work in the RFE mining developments. Alaska companies have supplied equipment to RFE mining operations and used Alaska as a staging area for logistics. Companies have also had personnel for their RFE operations based in Alaska.

Alaska has resident experts and companies with a wealth of knowledge about RFE mineral resources. The Alaska Miners Association has conducted missions to the Russian Far East and sponsored educational programs on Alaska-RFE mineral business.

Recent lower gold prices and political and economic uncertainties have been discouraging for RFE mining interests. However, considering the resource development potential, the opportunities in the RFE, and Alaska's strategic position to take part in these opportunities, companies remain interested in RFE mineral developments.

A company that operates one of Alaska's largest gold mines, Fort Knox near Fairbanks, also operates the Kubaka Gold Mine in the Magadan area. Alaska has served as a staging and logistics post for the Magadan mine.

Other mining companies operating in Alaska have sent personnel to various regions of the RFE on exploration missions. And Alaska actively encourages mining companies working in the RFE to use Alaska as a base of operations. Other eastern Russian regions where Alaskans have explored mining potential include Sakha, Chukotka, Kamchatka, Khabarovsk Krai and Irkutsk.

Alaska Miners Association Executive Director Steve Borell has made a strong case for why mining companies and the support industry should use Alaska as a base for RFE operations. See his article: www.dced.state.ak.us/trade/russia/whylocate.htm

International Organizations

Alaska has RFE connections and relations through international organizations, including:

• West Coast – Russian Far East Ad Hoc Working Group.

• Arctic Council. A federal government organization comprised of the eight arctic countries, including the United States, thanks to Alaska. The rotating secretariat resided with the United States for the period in 1999 and 2000.

• Northern Forum. Regions in Russia's north and east are among the two dozen northern regional government subdivisions that belong to this northern issues group, which has a secretariat in Anchorage.

• Inuit Circumpolar Conference and the newly formed Aleut International Association bring together Natives from Alaska and the Russian Far East.

• Alaska and Russia cooperate in circumpolar health organizations, scientific research bodies, marine mammal and other wildlife management councils, and other groups.

Alaska -RFE Ideas for the Next Millennium

Many people have dreams for future Alaska - Russian Far East connections, which variously face political, practical, financial or engineering obstacles, but all are grounded in a desire for pioneering new Alaska-RFE connections.

• Bering Strait tunnel. Link U.S.-Russian mainland, 55 miles apart at closest. Even if such a tunnel could be built, no rail connection exists on either side of the Strait.

• Bering Strait ferry. Seasonal service proposed by the Nome Chamber of Commerce to carry passengers and cargo between Nome, Alaska, and Provideniya, Chukotka, with village stops. Requires a feasibility study.

• Northern Sea Route. An arctic route north of the Russian Far East and Siberia would link the Pacific Rim to Europe in a shorter shipping route. This would also provide a lifeline to remote northern Russian settlements. Plans currently on ice.

• Bering Strait cruises. Adventure cruises have tested the Bering Strait waters with summer cruises to Chukotka, Magadan, Kamchatka, Vladivostok and Sakhalin, including the Kuril Islands.

• Big Diomede. A few optimists have even suggested opening Big Diomede, a Russian island in the middle of the Bering Strait less than 3 miles from Alaska's Little Diomede. This would be a unique stop that could feature a Cold War museum, Beringia research and perhaps a jumping off point for Chukotka and RFE tourism.

Updated August 1, 2001

Jeff Berliner
Russian Far East Trade Specialist
Alaska Division of International Trade & Market Development
550 W. 7^th Ave. - Suite 1770
Anchorage, AK 99501 USA
907-269-8131 / Fax 907-269-8125
Jeff_Berliner@dced.state.ak.us
http://www.dced.state.ak.us/trade/