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Trump’s Man in Moscow Gives Boost to Putin’s Economic Forum

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(Bloomberg) — The U.S. embassy in Moscow is encouraging American business leaders to attend Russia’s premier economic forum for the first time since the Ukraine crisis, even as political tensions between the Cold War rivals continue to rise.

Ambassador Jon Huntsman, appointed by President Donald Trump last year, has been promoting the May 24-26 event to U.S. business and plans to attend. The U.S. government had in past years actively lobbied executives to steer clear of the Kremlin’s main annual pitch for foreign investors, after Russia annexed the Ukrainian peninsula of Crimea in 2014.

“We have a lot of American businesses who are going to be there,” Huntsman said in a video posted Thursday on the embassy’s Twitter account. “It’s a very important time to talk about the future economic relationship between the United States and Russia.”

U.S. sanctions have expanded steadily since 2014, hitting top companies and businessmen last month and sending the ruble sliding.

Tone Change

But the embassy is sending an upbeat message these days. “They’ve stopped discouraging participation at the St. Petersburg Economic Forum and, on the contrary, are encouraging companies to come,” Alexis Rodzianko, who runs the American Chamber of Commerce in Moscow, said of U.S. officials. “They’re saying the more important people you send, the better. There’s been a change in tone and message.”

Huntman’s predecessor, John Tefft, attended the forum last year, ending a three-year hiatus for official U.S. representation but keeping a low profile without any pitch to businesses to participate.

Huntsman is scheduled to appear on a panel about Russian-American relations on May 25 together with billionaire businessman Viktor Vekselberg, who was sanctioned by Washington last month over the Kremlin’s election meddling and has been linked to a $500,000 payment to an entity set up by Trump’s personal lawyer Michael Cohen. Vekselberg denies any involvement in the transaction.

Tough Sell

With U.S. businesses, Huntsman’s powers of persuasion appear to be lacking. Despite President Vladimir Putin headlining the glitzy event, a preliminary list of attendees shows a lack of firepower from U.S. companies, as Russia’s sluggish economic outlook rather than political pressure keeps senior executives away.

U.S. firms active in Russia seem to be mostly content to send local executives, with the exception of ExxonMobil Production Co.’s Neil Duffin and the head of International Paper Co., Mark Sutton, who forum organizers say are expected to come. PricewaterhouseCoopers LLP said it would send Chairman Bob Moritz. Bloomberg News Editor-in-Chief John Micklethwait will moderate a panel with Putin, French President Emmanuel Macron and Japanese Prime Minister Shinzo Abe on May 25.

Trade between the U.S. and Russia rose 16 percent last year to $23.2 billion, making America Russia’s sixth-largest trading partner, according to data from the Russian Federal Customs Service.

“It’s difficult enough to persuade international investors to contemplate Russian assets at the best of times but recent sanctions and the prospect of further measures being implemented at any time, imperils any capital commitment,” Julian Rimmer, a trader at Investec Bank Plc, said Friday. “‘Those who aren’t obliged to make the trip, won’t.”

The ambassador’s efforts come as Trump has repeatedly pushed for a better relationship with the Russian leader, and invited Putin to Washington after he won a record fourth term in March.

(In an earlier version of this story, the name of the International Paper chief was corrected.)

To contact the reporters on this story: Jake Rudnitsky in Moscow at jrudnitsky@bloomberg.net, Ilya Arkhipov in Moscow at iarkhipov@bloomberg.net, Andrey Biryukov in Moscow at abiryukov5@bloomberg.net.

To contact the editors responsible for this story: Gregory L. White at gwhite64@bloomberg.net, Dale Crofts at dcrofts@bloomberg.net, Ben Holland

©2018 Bloomberg L.P.

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