RIA Novosti reports the Federal Security Service said Tuesday it has exposed 27 foreign intelligence officers and 89 Russian agents this year. "Of this number, one career intelligence officer and eight agents were caught red-handed," FSB Director Nikolai Patrushev said. "Twenty-one foreign nationals involved in intelligence operations were deported from Russia."
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Putin’s presidency is constitutionally mandated to end in 2008, when new elections will be held. But who is Putin’s Putin? He succeeded Boris Yeltsin by promising that, whatever purges he might carry out, Yeltsin and his family would be shielded. Yeltsin was old, ill and alcoholic, and Putin’s offer must have seemed one he couldn’t refuse. Putin is young and vigorous, and has no reason to put his fate in the hands of a successor or successors who wouldn’t be able to guarantee his lifelong immunity even if they wanted.
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So far, Mr Putin is resisting all efforts to persuade him to amend the constitution and stay for a third term as president of Russia, but the pressures are mounting, The Financial Times report. He has promised to remain closely involved - but Russia has never been run successfully with a division of power in the Kremlin. So the speculation remains.
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The New York Times published an article yesterday portraying the growing gap between the have's and have-not's in today's sizzling housing market of Moscow flooded with oil money.
“Leave Us Alone” is the name of a movement started by the residents of Ostozhenka, once home to many artists and intellectuals, which is now known in the parlance of real estate agents and their wealthy clients as the Golden Mile. It was spurred by the latest luxury housing project, slated for the site of an apartment building in which some of them still live, at Khilkov Pereulok 3.
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President Vladimir Putin believes that a powerful, state-controlled energy sector is the key to Russia’s economic future, even if he has to strong-arm foreign investors to get it. But trampling property rights is risky. It is as likely to leave Russia an economic pariah as an energy superpower.
Read more in today's New York Times editorial...
In 2006, Putin made use of high oil prices to bolster Russia's position in the world to the strongest it has been since the cold war ended more than 15 years ago. "He's using the advantage of high oil prices to make Russia count," says Margot Light, a Russia expert at the London School of Economics.
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US energy giant ConoccoPhillips said it plans to raise its stake in Russian peer LukOil to 20 percent by the end of this year. In a joint statement, the companies said the move is part of a strategic alliance that was announced in 2004. The companies said in the same statement that LukOil has acquired 376 Jet brand fuelling stations in Europe from ConocoPhillips.
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Russia has emerged as an unrivaled energy superpower in a world thirsty for oil and gas, but the country's recent moves to seize control of strategic parts of the energy industry have slowed growth in production and raised questions about the legal rights of investors and speed of future development, writes Patrice Hill for The Washington Times.
As the world looks increasingly to Russia to satisfy its energy needs, the International Energy Agency is raising questions about whether growth in Russian oil and gas exports will be fast enough to keep up with rising demand in Europe and commitments Russia has made to deliver oil and gas to both Europe and Asia. "Will the investments take place? Will they come on time?" asked William C. Ramsey, deputy executive director of the international agency. "These are costly projects. ... We're concerned that the investment climate now is not conducive to bringing those resources online."
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Top Russian gold miner Polyus Gold (PLZL.RTS: Quote, Profile , Research), which is due to list on the London Stock Exchange on Monday, will consider a foreign merger. Polyus, which produces 18 percent of Russia's gold, has said it plans to create by 2015 a company with market capitalisation of $14 billion to $16.5 billion (7 billion to 8.4 billion pounds) and net annual cash flow of $600 million to $710 million. The firm was spun off this year from Russian mining giant Norilsk Nickel.
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Rapid growth may have convinced many big companies that they need to be in the Russian market. Yet if you aren't allowed to keep control of your assets, there is no point in being there. Put your money to work in eastern Europe, India or China instead, writes Matthew Lynn for Bloomberg.
Russia and Belarus seem no closer to reaching an agreement over a dispute about the cost of gas supplies after a meeting of the two countries' leaders, reports BBC. Russia has threatened to quadruple the amount its neighbour pays for its imports unless it takes control of Belarus' gas distribution network.
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About 300 demonstrators gathered Sunday to remember Anna Politkovskaya and other journalists who had been killed in Russia. Participants in the unauthorized rally in downtown Moscow held pictures of Politkovskaya and other reporters who have been killed, and chanted "Down with Police State!" before observing a moment of silence behind heavy police cordons.
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Lisa Buckingham, the Financial Mail editor writes that the challenges that Shell is facing in the Sakhalin-2 project are great, but nothing new. Muddling through with hostile political regimes is day-to-day stuff for oil giants. The expropriation of assets is, historically, par for the course. Remember, for example, that BP had a goodly part of its business swiped by Iran.
As BP's chief executive, Lord Browne, remarked when discussing the difficulties of doing business in Russia, if not there then the alternative was violent, war-ravaged Africa. Looked at from this perspective, Russia appears eminently hospitable.
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AP reports that more than 2,000 people held a rare anti-government rally in Moscow on Saturday, accusing the Kremlin of growing authoritarianism and protesting against electoral law changes. Authorities, however, pulled opposition activists off buses and trains, and hundreds were detained to prevent them from attending, activists said.
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In its Friday's special report, The Economist wonders "what a poisoned Russian agent tells us about the way that Russia is governed". Its article offers a broad range of theories of who was responsible for Litvinenko's death but the main point remains that at the end of the day, the 'who' may not be as important. What is important, however, is that the case actually caused the controversy it did and put Vladimir Putin's Russia under microscope.
As seems to be the case, Litvinenko was nothing like the Russian KGB superagent turned human rights advocate as he was portrayed in Western press. "He was not really a spy, as he has been described, but worked for domestic units of the FSB, one of the KGB's post-Soviet successors. He has been labelled a defector; but few people took the information he brought out of Russia when he fled to Britain seriously." However, his death marked a drastic turn in how Russia is viewed. The war in Chechnya, the contract murders in Moscow and the consolidation of power in the hands of the siloviki is one issue. The fact that the perception exists that the Russian state actually could reach out and assassinate a British citizen in London (regardless whether it actually was the case) is another issue. But the two cannot be viewed in vacuum. Litvinenko's murder was the proverbial last drop that caused the bucket to overflow. All of the sudden, the situation in Russia cannot be ignored any longer. Putin's shortcomings that were conveniently pushed aside when we wanted Russian oil and natural gas and when we wanted to be part of Moscow's stock and real estate market boom are suddenly exposed as never before.
AP reports that Japan's foreign minister said a dispute with Russia over a string of islands could be solved by splitting the total land area in half, a newspaper reported Thursday. Russia and Japan both claim a group of islands seized by the Soviets near the end of World War II. The dispute has prevented the countries from a signing peace treaty to formally end World War II hostilities.
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Reuters reports that the head of an organization of former Russian spies was quoted as saying on Thursday Stalin-era policies of Moscow assassinating enemies had ceased, and ex-KGB agent Alexander Litvinenko was probably murdered by criminals. Former KGB agent Valentin Velichko, head of a Moscow-based Russian nationalist foundation called "Dignity and Honor," said in an interview with German Die Welt newspaper (in German) that Litvinenko, who died on November 23 from severe radiation poisoning, was a traitor but was not killed by Moscow.
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Sean Guillory's blog features an ealier interview with the vice president of "Dignity and Honor" reprinted from the Kommersant.
Reuters reported that Russia's outspoken environment watchdog Oleg Mitvol, who has waged a harsh campaign against the Shell-led Sakhalin-2 energy project, faced disciplinary proceedings on Thursday that could herald his dismissal. The head of state environmental agency RosPrirodNadzor, Sergei Sai, has asked Resources Minister Yuri Trutnev to hand Mitvol a formal warning, a ministry spokesman said.
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There won't be many tears in the Russian business community. Mitvol has been involved not just in Sakhalin-2 but in many other similar disputes targeting Russian and foreign businesses alike.
Reuters reports: President Vladimir Putin has never hidden his KGB spy past and over three-quarters of Russia's political elite have tell-tale signs of a background in the security services or military, a new study says.
"Our research has shown that ... 78 percent of the Russian elite have signs of being siloviki," Olga Kryshtanovskaya, who has studied the Russian elite since 1989, told Reuters in a telephone interview.
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A key witness in the radiation death of former Russian security agent Alexander Litvinenko claimed the poisoning took place earlier than is widely believed, a newspaper reported Wednesday.
Andrei Lugovoi, a security agent-turned-businessman who met with Litvinenko at a London hotel on November 1, the day Litvinenko suspected he was poisoned, said in an interview with the Moskovsky Komsomolets tabloid that he and Litvinenko were poisoned on October 16.
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AP reported that Russia's Foreign Ministry criticized the United States for raising the plight of an opposition leader in Belarus in the United Nations Security Council, saying the move violated U.N procedures.
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Garry Kasparov, the former world chess champion who is now a Russian opposition leader, said Tuesday that the police had raided his office to try to disrupt a planned protest against President Vladimir Putin, writes The International Herald Tribune.
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The Russian authorities have changed their mind on the possibility of foreign companies participating in the world’s largest gas field, Shtokman. EU Commissioner for Energy Andris Piebalgs told RBC Daily that Norway’s Hydro and Statoil may accept the Kremlin’s offer, as well as France’s Total.
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Russian authorities have detained Ivan Mironov, the 25-year-old history student, who had been wanted over an assassination attempt on the head of the Unified Energy Systems of Russia joint-stock company, Anatoly Chubais, Interfax reports. Boris Mironov, father of the detainee and former Russian Federation Press Minister has also been detained in Moscow recently.
Anatolii Chubais, the head of Russia's electricity monopoly, escaped an assassination attempt on March 17, 2005. He was traveling in a motorcade on the Minsk highway towards Moscow when a landmine planted on the road exploded. Then, two armed men wearing white camouflage in a nearby forest, opened fire on the motorcade with automatic weapons. Chubais's bodyguards returned fire, and the would-be assassins fled into the forest.
Read more about the assassination attempt on Chubais from BBC...
Today, the European Union receives a half of its imported gas and a third of imported oil from Russia, which delivers nearly all of its hydrocarbons exports to Europe. Russia's Asian neighbors, on the other hand, receive by rail only 3% of Russia's oil and no gas. This is about to change, according to RIA Novosti's Yury Alexandrov.
In late 2004, the Russian government issued a resolution on the construction of a controversial 4,000-km East Siberia - Pacific Ocean (ESPO) oil pipeline with a throughput annual capacity of 80 million tons. Out of this amount, up to 30 million tons of oil should be sent along the first leg to Daqing, the oil producing center of China, and some 50 million tons to the Pacific coast (second leg).
During President Vladimir Putin's recent official visit to China, energy giant Gazprom and China National Petroleum Corporation (CNPC) signed an agreement on the annual delivery of 30-40 billion cubic meters of gas to China after 2010, with a possibility of increasing deliveries to 60-80 billion.
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According to The Economist, the Shell’s recent secession of control over the Sakhalin-2 project should not come as a surprise. Vladimir Putin’s regime shamelessly dismembered Yukos, an oil firm owned by a political rival. And Russia’s government has made little secret that it regards energy as a legitimate tool of foreign policy in an energy hungry world. The grab for Sakhalin is just the latest tightening of Russia’s grip on its oil and gas reserves. The Kremlin is discouraging foreign participation in the exploitation of energy reserves: legislation is planned to limit outsiders, in future, to minority stakes in energy and precious-metal firms.
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RIA Novosti reports: The issue of Georgia's breakaway republics should be decided by Tbilisi together with the international community, not by Russia, the speaker of the Georgian parliament said Tuesday, after the popular Russian daily Kommersant reported earlier that Russia has worked out a plan on the status of Abkhazia and South Ossetia.
According to the plan, Abkhazia and South Ossetia will reunite with Georgia as a confederation. They will formally be part of Georgia, but will enjoy de-facto independence recognized by the international community.
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Russia recognized Tuesday the landslide vote for the incumbent leader of Moldova's breakaway region Sunday, saying it should be taken into account at talks on Trans-Dniester's status, reports RIA Novosti.
Trans-Dniester's Election Commission said Monday that President Igor Smirnov, who has served three consecutive terms as leader of the post-Soviet de facto independent republic, won 82.4% of the vote. Moldova and the European Union have not recognized the vote and its result.
The Kremlin said yesterday it was "extremely worried" about damage to Russia's reputation from the Litvinenko affair and the readiness of western media to blame Moscow as it launched a public relations offensive intended to challenge presumptions of official Russian involvement in the death of the former KGB officer, The Financial Times report.
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Vladimir Putin's deputy spokesman, Dmitry Peskov, has called the killing of Alexander Litvinenko in London an attempt to destabilise Russia in a news segment on BBC amid a public relations offensive of the Kremlin.
Watch here...
The Washington Post reports: Russia's intertwined political and business elites are increasingly populated with former intelligence agents who have personally proved themselves to Vladimir Putin. At the same time, Putin has spearheaded the regrouping and strengthening of the country's security services, which had splintered into a host of agencies after the Soviet Union's dissolution in 1991. In recent years, the Federal Security Service has emerged as one of Russia's most powerful and secretive forces, with an increasingly international mission. Putin headed the agency in the 1990s.
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According to The New York Times, the German authorities announced Sunday that they had begun a criminal investigation of a Russian businessman after finding traces of polonium 210 around Hamburg that date back to Oct. 28 — four days before he met in London Alexander Litvinenko. It has added to suspicions that the case is connected to the shadowy world of agents and businessmen, defectors, spies and exiles let loose by the dissolution of the K.G.B., and still entwined with successor agencies.
The man the Germans have put at the center of scrutiny is Dmitri V. Kovtun, a 41-year-old Russian who was a student in the 1980s at the Supreme Soviet Higher Military Command School, where many students went on to serve in the K.G.B. He has been in a Moscow hospital since Dec. 7, suffering from exposure to polonium. There are conflicting reports about his health; Interfax, the Russian news agency, reported he was in critical condition, but his lawyer later disputed that.
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As was widely expected, Moldova's rebel Trans-Dniester region re-elected pro-Russian leader Igor Smirnov for a fourth five-year term as president in Sunday's presidential election, the head of the central election commission said on Monday.
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Russian daily Kommersant reported on Monday, Dec. 11, that the meeting of the Russian Security Council chaired by President Putin on Saturday developed a new strategy to give the government control of oil and gas extraction on the Russian sea shelf. The paper reported that the Russian authorities may combine state-controlled giants Gazprom, Rosneft and Zarubezhneft into a single government monopoly that would take over the shelf production.
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Gazprom said Royal Dutch Shell Plc made new proposals for the Russian company to join its $22 billion Sakhalin-2 oil and gas venture, as President Vladimir Putin expands his control of the world's biggest energy industry.
Reuters earlier reported that Shell agreed to cede state-run Gazprom a majority stake in Sakhalin-2. Moscow-based Gazprom spokesman Sergei Kupriyanov and Shell Russia Vice President Maxim Shoob declined to confirm or deny the Reuters report, which cited unidentified industry people.
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Royal Dutch Shell’s decision to hand over control of the $22 billion energy project in Sakhalin to Russia’s state monopoly Gazprom is a victory for Russia’s new hardline policy on energy. It is also a warning to Western business that investment in Putin’s Russia still carries real risks, writes Michael Binyon of The Times.
The investigation into the death of a Russian dissident in London heats up and sheds an ugly light on Vladimir Putin's rule - The Time Magazine published a seven-page article on December 10, examining the multiple facets of the Litvinenko affair.
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Alexander Litvinenko, the former Russian spy murdered in London, was sent a series of letters warning him of a plot to kill him, The Sunday Telegraph reveals. In the letters, passed exclusively to The Telegraph, Mikhail Trepashkin, a former state security agent jailed in 2003 after trying to expose corruption, warned Litvinenko that his life and those of his wife and children were in danger from Russian hit men. Read more...
Internationa Herald Tribune reports that residents in the self-proclaimed separatist republic of Trans-Dniester in eastern Moldova cast ballots Sunday in a presidential election. Igor Smirnov, an authoritarian leader with strong ties to Russia who has run Trans-Dniester since 1991, is expected to easily beat three challengers to win a fourth consecutive five-year term in office.
Trans-Dnister or Pridnestrovie is a region of the Republic of Moldova in southeastern Europe which declared its independence on September 2, 1990. Its de facto independence has not been recognized and its sovereignty remains an issue of contention.
There is disagreement as to whether elections in Transnistria are free and fair. Western countries and organizations, such as the OSCE, have declared that no democratic elections can take place in Transnistria under the present circumstances and have refused to recognize or monitor them. Election results are suspicious, as in 2001 in one region it was reported that Kamchatka-raised former metalworker Igor Smirnov collected 103.6% of the votes. Nevertheless, some organizations, such as CIS-EMO, have participated and have called them democratic.
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Business Week published an analysis of Russia's economy asking the million dollar question. Is the recent boom that has made Russia the fastest growing emerging market the last two years for real?
There's little doubt that a major driver of the newfound bounty is oil and other natural resources. Without the runup in commodity prices, economic growth would have been two to three percentage points lower during the last three years, estimates the Organization for Economic Cooperation & Development. Developing countries, meanwhile, don't have a very good track record of using windfall profits from commodity booms to lay the foundations for sustainable growth.
To his credit, Putin has used much of the cash to build up financial reserves. Russia has created a $90 billion fund—equivalent to 9% of gdp—to protect against a drop in oil prices. Fiscal policy remains tight, with the Kremlin expecting a budget surplus equal to 7% of GDP this year. And Russia is well ahead of most other resource-rich countries in its economic development, with a long tradition of education, science, and industry.
Economists warn that high oil prices have bred complacency. The OECD cautions that economic reforms have largely stagnated. Worse, corruption and bureaucratic interference continue to impede business: Russia ranks alongside Gambia and the Philippines near the bottom of think tank Transparency International's annual list of corrupt countries.
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Britain today delayed the airing of an "inappropriate" anti-smoking advertisement because it warned viewers that cigarettes contained the radioactive isotope that killed ex-Russian spy Alexander Litvinenko. Read more...
Robert Amsterdam: 2006 Marked by the Rise of the Corporate State
"As Andrei Illarionov pointed out during a speech at the Cato Institute last month, in the case of Yukos, these energy assets were transferred by illegal means not from one private owner to the people, but rather from one group of individuals to another group of individuals. It is absurd to pretend that this is a real nationalization when it is only a small group of private individuals within the government lining their pockets with the rents from these businesses."
The Financial Times report that Russian prosecutors are exerting pressure on UK authorities to allow their own investigators to fly to London to probe the poisoning of Alexander Litvinenko, in a move that threatens to raise political and diplomatic tensions over the case.
Russian authorities have requested access to individuals they want to question in London, including Boris Berezovsky and Akhmed Zakayev, who have declared themselves associates and friends of Litvinenko. Read more...
President Vladimir Putin and two senior state officials reopened the possibility of foreign energy majors taking part in the Shtokman gas project, signaling that Gazprom might soon reverse its decision to bar them from developing the giant Arctic field, reports The Moscow Times.
Gazprom's announcement in early October that it had rejected all five foreign bidders for Shtokman prompted widespread shock and skepticism in the global oil and gas industry. Many doubted Gazprom was capable of developing the huge gas field, its first offshore, on its own.
In separate statements, Putin and Industry and Energy Minister Viktor Khristenko reiterated Gazprom's argument that the equity swaps offered by the five short-listed companies -- U.S. oil majors ConocoPhillips and Chevron, France's Total, and Norway's Statoil and Norsk Hydro -- were inadequate.
Putin's recent comments prompted speculation that the selection of foreign partners for Shtokman could, after all, have been linked to negotiations with the United States on Russia's entry to the World Trade Organization. Spokespeople for the Kremlin have previously denied the existence of a direct link between the two issues.
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Russia Today, Moscow's English-language satellite television channel, reported that Russian government officials are considering filing libel suits against international journalists over their reporting on the poisoning death of former Russian spy Alexander Litvinenko. Read more...
In the Sunday edition of the New York Times, Scott Shane, reflects on the increasing influence of the KGB and its return to long abolished deadly practices.
For decades, any K.G.B. officer who defected was automatically tried and sentenced to death, and officers overseas were expected to carry out the sentences. In the late 1960s, when Yuri Andropov became K.G.B. chief, the practice faded. Now the practice may be back and playing out in a world where former K.G.B. officers, with murky continuing relations with the successor agency, are found in many countries. Michael McFaul, a Russia specialist at Stanford University, said that whoever killed Mr. Litvinenko chose the gruesome murder weapon to deter others who would openly break with the F.S.B. and the regime. “The message is: Be afraid. Be very afraid,” he said. Read more...
No matter who killed Litvinenko, Putin's Russia is a killing zone for journalists, writes The Los Angeles Times.
Were the killings of Politkovskaya and Litvinenko isolated incidents, the Kremlin's protests that it suffers most from the bad international publicity would be more worthy of sympathy. But Politkovskaya was at least the 21st Russian journalist to be killed since Putin was elected in 2000, according to Reporters Without Borders. Two others have disappeared and are presumed dead, and there have been 320 assaults.
While the newspaper's staff risks their lives to shed light on the inner workings of Putin's Russia, the West has a moral obligation to insist that the Russian government protect them. Read more...
The widow of poisoned former Russian spy Alexander Litvinenko said last night she believed the Russian authorities could be behind his death, as it emerged that two British police officers investigating the case had been contaminated with polonium 210.
Marina Litvinenko said her husband had never felt that he was a 'first target' and she did not realise how much he had ben at risk until he was close to death. She indicated that she did not blame Russian President Vladimir Putin directly, but said: 'What Putin does around him in Russia makes it possible to kill a British person on British soil. I believe that it could have been the Russian authorities.' Read more...
Scotland Yard detectives have now had a week of official stonewalling; the British ambassador is being threatened by Right-wing thugs; and frustration and intimidation (and increasingly extortion) have become the norm for anyone doing business in Russia, writes The Sunday Telegraph.
It is very easy to criticize Russia these days; in fact, it would be much harder to say something positive. However, it seems to me that at this point there is nothing the Russian government can do to stop the continuous attacks of the Western (and particularly British) media. What seems especially unfair to me is how the investigation process into the Litvinenko poisoning has been portrayed.
"[Yuri Chaika, Russia's chief prosecutor], instructions to the team, which was led by a detective chief superintendent and was in Russia to interview potential witnesses in the investigation into the murder of the former Russian spy, Alexander Litvinenko, were succinct and to the point. The interviews, he told them, would be carried out chiefly by his officers, with the British detectives as witnesses; no suspects would be extradited to the UK, and all Russian citizens suspected of involvement in the poisoning of Litvinenko would be tried in Russia."
Yes, Russia is a very corrupt country; yes, it is debatable if you can classify it as a democracy or a dictatorship; and yes, the recent events from the murder of Ana Politkovskaya to the harrassment of the British ambassador sheds a negative light on Russia under Putin. However, we should not forget that Russia is a sovereign (and proud) country. Russia does not have an extradition treaty with Russia and critisizing the fact that no suspects in the Litvinenko case would ever be extradited to Russia completely misses the point. Does the UK extradite Berezovsky and Zakayev? It does not. I am not arguing that it should but the principle is the same. Furthermore, the British press is very critical of the fact that the British police is dependent on collaboration with Russian authorities and, surprise-surprise, the Russians are not very willing to cooperate. I would like to see the cooperation if the sides were reversed. Can you imagine the amount of help the Russian militsia would receive in London investigating a highly controversial, politicized case? I don't think there would be very much.
I have no illusions about Russia under Vladimir Putin and the siloviki. I wish Russia was less corrupt, and more democratic and transparent. I think that the recent events have been terrible, and certainly put Russia under a scrutiny that was long overdue. However, I think that the reporting of the mainly British press borders on histeria.
Update: Peter Beaumont's thoughts in his comment in Sunday's edition of The Observer titled Just who do we think we are? observe the same treatment of the British media over how the authorities in Moscow are restricting the access British detectives are allowed to key witnesses in the Litvinenko affair.
This interview is not exactly hot off the press but it offers some interesting insights into the murky world of Russian intelligence. Foreign Policy published an interview with Yevgenia Albats is professor of political science at the Moscow-based state university, The Higher School of Economics, in wake of the Litvinenko poisoning. The answer to the question on everyone's mind: Who is the FSB? Who controls them? What is the danger coming from them? is that nobody knows. What seems to be apparent, though, is that we are not dealing with the KGB anymore when its goals were clearly defined by the Soviet ideology and which was working more or less directly in the interest of the Soviet state.
Sean Guillory: Nashi's Anti-Brenton Campaign
"Nashi has become one of the populist means to intimidate those it has deemed enemies of Russia and Putin. Welcome to the Komsomol reincarnate."
Martin Kelly: Sack Brenton Now
"To those Russians standing outside the British Embassy on Moscow demanding that [Brenton] apologise, I apologise on his behalf; and hope in all sincerity that the thugs and thieves who have been given shelter in my name in my country will soon be returned to face your justice."
La Russophobe: Kremlin's Youth Cult On Rampage
"Foreign ministry officials privately agree that Nashi's behaviour is outrageous and goes well beyond peaceful protest. But they claim there is little they can do: Nashi is too close to the Kremlin. It has close ties with Vladislav Surkov, the deputy head of the Kremlin administration, as well as Mr Putin himself."
The Washington Post has brought a commentary in its Saturday edition revising the bitter relationship between Boris Berezovsky, the exiled Russian billionaire, and Vladimir Putin. Following the death of Alexander Litvinenko, Berezovsky found itself once again at the center of the international intrigue. His personal relationship with Putin makes the recent events even more bizarre.
Berezovsky was prominent among the group of Russian oligarchs who helped the then relatively Putin win the presidential election in 2000 following the abrupt abdication of Boris Yeltsin. However, Berezovsky was not able to retain his prominent position in the inner cercle of the Kremlin that he held under Yeltsin. Berezovsky's supporters claim that he was appalled by the increasing consolidation of power in the hands of Putin and his former KGB colleagus. According to Putin's followers Berezovsky unhappily discovered that the new president would not be his puppet like the ailing Yeltsin.
more...
On December 7, Yegor Gaidar discussed with Newsweek his sudden, mysterious illness.
The British ambassador suffers months of harassment and BBC service in Moscow mysteriously goes off the air after the Litvinenko murder, The Times report.
The pro-Kremlin youth movement Nashi has been accused of a systematic campaign of intimidation against the British ambassador in Moscow, Tony Brenton, following his speech at a Russian opposition meeting in July. At the time President Putin accused Brenton of interfering in Russia’s domestic affairs, after the envoy spoke at the Other Russia opposition gathering held before the G8 summit in St Petersburg. more...
Nashi (Ours) has been formed in March 2005 to "put an end to the unnatural union of oligarchs and anti-Semites, liberals and Nazis". However, Nashi itself has often been compared to organizations like the Hitlerjugend (Hitler Youth) or the Komsomol. more...
The Russians are also suspected of a hand in the disruption of the BBC’s Russian Service FM broadcasts in Moscow and St Petersburg, at the height of coverage of the Litvinenko poisoning. more...
A fire in a drug-treatment hospital in Moscow early Saturday killed 45 women who were trapped behind a blocked emergency exit and locked window grilles as smoke suffocated them, Russian officials said. While arson was suspected, the magnitude of the death toll appeared to result from gross safety violations and the evident failure of the hospital’s staff to make an effort to rescue its patients, the officials said. As the New York Times reports, Russia has strict building and fire codes but also a culture of bribery and corruption that allows violations to pass unpunished - and unfixed. more...
Detectives investigating the poisoning death of an ex-KGB agent focused Friday on a meeting at a London hotel bar where at least 10 people may have been exposed to radioactive polonium-210, CNN reports. Also, on December 5, CNN published a Who's Who? in the Litvinenko case.
Russia’s and the United States’ geopolitical interests clash in Central Asia and the Caucasus, writes Aaron Sadler in his analysis for the Russia Profile. These territories are not only strategic for expanded influence after the fall of the Soviet Union, but also for access to increasingly important energy resources and supply routes. In the 1990’s Russia has lost its previous advantage in the area and the United States did its best to fill the void. The resurging Russia under Putin, however, strives hard to regain its lost influence, which leads to tensions between the two powers. Sadler argues that “it is in the Caucasus that a conflict could arise between the United States and Russia, driven by the need for energy security. However, it is also important to note that this potential conflict would probably not entail any overt moves directly against the larger players but, like a Cold War conflict, be played out by proxies.” more…
It may be misleading to describe the relations of Russia and the West as the new Cold War, yet, argues The Economist. However, it would also be misleading to underestimate the threat Russia has come to present over the seven years of the Putin era. Russia does not threaten the West with its vast nuclear arsenal anymore; its weapons are more subtle: “cheap gas, and money for the right people.” more…
The United States and Russia accounted for 38 of 45 energy billionaires on this year's Forbes list of world's richest people. First on the list is Roman Abramovich, the owner of the Chelsea soccer team, who sold his stake in oil firm Sibneft to the state owned Rosneft for $13 billion. First among active oilmen is another Russian, Vagit Alekperov, the president of Lukoil.
Shell’s weblog reprinted a commentary by Ben Aris, the editor of Business New Europe in which he discusses the recent wave of spats between Rosprirodnadzor, the Russian environmental watchdog, and some high-profile industrial groups. The most illustrious example is the recent finding of environmental negligence in the Sakhalin II project. Russian companies are targeted as well as shows the case of Lukoil whose environmental licenses Rosprirodnadzor questioned in October. As we discussed in an earlier post, “the Sakhalin case has done more than anything to popularize the idea that assaults on companies using environmental laws as a weapon represent a new phenomenon in Russia, but the threat has been present since the Kremlin began its more aggressive industrial policy in 2004.” However, despite the rhetoric, Rosprirodnadzor has not yet followed through on any of its threats. But the memory of Yukos (which did not collapse on environmental grounds but because of Kremlin’s crusade against the socalled tax-optimization schemes) is sure to keep the investors on their toes.
A day after announcing the finding of more than 100 violations, Russia has suspended vital permits for Royal Dutch Shell's Sakhalin-2 oil and gas venture, in a move that may further delay the $22bn (£11bn) project, BBC reports.
BBC brings an overview of Russian press. It reports that the Russian readers today enjoy a much wider variety of titles than they ever did during the Sovier era. However, the circulation rates in Russia with roughly 100 newspapers sold for every 1000 inhabitants are among the lowest in Europe. Furthermore, several influential newspapers in Moscow have been bought up by business groups close to the Kremlin in an apparent effort to establish more control over the media. These efforts, however, may be rather redundant because "as a news medium, the press has been comfortably overtaken by television, which is more popular [and] has far wider reach." And Kremlin's control over Russian television is complete with all the stations broadcasting from Russia being owned by Kremlin friendly groups.
On December 6, Vladimir Putin has signed into law a bill that abolished minimum voter turnout (20 percent) for all elections in Russia. On Nov. 23, a week after the controversial bill was approved by the Duma, two young political activists - Ilya Yashin, the youth leader of Yabloko and Maria Gaidar, the daughter of Yegor Gaidar, the former Russian PM - protested the bill by spending an hour and a half suspended on ropes from a Moscow bridge facing the Kremlin and flying a 10-meter banner, which said: “GIVE THE ELECTION BACK TO THE PEOPLE, BASTARDS!”
They were detained by the police and fined 500 rubles (about $20) by the court – a pittance compared to the sentence of Olga Kudrina in May 2006, a member of Eduard Limonov’s National Bolshevik Party, who was sentenced to three and a half years in prison for climbing the Rossiya Hotel and hanging a banner saying “Putin, go away on your own” on the side facing the Kremlin.
Sergei Ivanov, the Russian defense minister, currently in Kiev for a session of the security subcommittee of the Russian-Ukrainian interstate commission, told journalists Ukraine has a sovereign right to join the Western security alliance, but that "the consequences of this move will have a negative impact on bilateral relations."
Thousands of people staged a rally calling for Abkhazia’s independence from Georgia yesterday, after The Abkhaz separatist president, Sergei Bagapsh, said the region would never be part of the same state as Georgia. Abkhasia is an autonomous republic of Georgia but which proclaimed independence after a civil war in the 1990’s. It has not been internationally recognized as a separate nation but it remains de facto independent from Georgia.
Russia maintains strong political, economical and military influence over Abkhasia, and during the Georgian civil war supported the Abkhasian separatists against the Georgia government. During the war, the Georgian majority that inhabited the Abkhaz region has been displaced, and today the Abkhaz population consists of en ethic mix of Russian (45%), Armenians, Georgians, Jews, and Greeks. The majority of the non-Georgian population holds Russian citizenship.
In a commentary printed in The Financial Times, Yegor Gaidar, the former Russian PM, retells the story of his poisoning and offers a theory who may have been behind it. “Most likely […] some obvious or hidden adversaries of the Russian authorities stand behind the scenes of this event, those who are interested in further radical deterioration of relations between Russia and the west. Within several hours, comparing the dates of events that took place during the past six weeks, I formulated a rather logical and consistent hypothesis on the reasons behind this. The world view regains its intrinsic logic and ceases resembling a Kafkaesque nightmare. Still, it does not look any more enjoyable. Well, as they say in Russia, as long as we are alive, we might even be happy some day, but that is a different story.”
Russian property developer RGI International Ltd. joined the trend and announced late on Wednesday it planned to raise about $175 million (89 million pounds) after listing on London's Alternative Investment Market (part of the London Stock Exchange), according to Reuters. The company, which specialises in high-end office, retail and residential property in central Moscow, said the offer price had been set at $6 per share. As a result, the market capitalisation of RGI after the listing would be about $593 million.
This is just the last from a series of Russian IPO's in the last few years that culminated with the initial public offering of the shares of the Russian energy giant Rosneft that raised $10.4 billion making it the fifth largest IPO in the world. According to RIA Novosti economic commentator Nina Kulikova, Russian IPO's abroad (mostly in London) raised $5 billion in 2005 and are expected to raise $20 billion in 2006. While the interest is the highest in the commodities sector, other firms like RGI International Ltd. are starting to float their shares as well.
Azerbaijani Prime Minister Artur Rasulzade has announced that his country will be able to cover its energy needs starting Jan. 1, 2007 and will stop the transfer of Azeri oil through the Baku-Novorossisk pipeline. This is seen as a retaliatory measure following Gazprom's proposed increase of the price of Russian natural gas exported to Azerbaijan from $110 to $230 per 1,000 cubic meters.
On November 22, Gazprom announced new price levels for natural gas in an attempt to bring the prices it charges its ex-Soviet neighbors to European levels. These countries have previoulsy enjoyed preferential rates. This move was also seen by some as policial motivated and meant to punish its unruly neighbors, notably Georgia and Ukraine. In the case of Azerbaijan, its president Ilham Aliyev said on December 4: “It is clear that the price of $230 per 1,000 cubic meters suggested by Russia is very high for us. Therefore we have to consider different options. If need be, we should consider reducing the volume of oil being exported to Russia via the Baku-Novorossiysk pipeline in order to provide ourselves with electricity. We have no other choice because we use gas imported from Russia to produce electricity at our power plants.” Today Prime Minister Rasulzade announced Azerbaijan's intention to forgo Gazprom's deliveries and rely on its own reserves instead.
Azerbaijan's decision to not export oil through Russia via the Baku-Novorossiysk pipline is also an economic one. The transit tariff of $2.05 is exactly five times higher than on the shorter alternative route to the Black Sea, the Baku-Supsa pipeline that through Georgia.
This event marks the emergence of the first ex-Soviet country that is independent on Russian energy, notes Stratfor. Russian reaction remains to be seen, but it is unlikely that many others will follow in the near future.
RIA Novosti reports that Russian prosecutors have discovered over 100 violations of environmental, migration and energy laws in the Sakhalin II energy project. The project has been long criticized by various environmental groups and Sakhalin residents for the alleged indifference of its operators (Shell, Mitsui and Mitsubishi) to environmental hazards that come with the complexity of the project in the extreme conditions of the Sakhalin Island. However, international observers attribute the last wave of governmental scrutiny to Russia’s pressure “to secure more favorable terms for state-controlled gas monopoly OAO Gazprom to join the project […] as the Kremlin is increasing its role in the lucrative energy sector.” In 2005, Shell increased the estimated cost of the project nearly two-fold to $22 billion dollars. However, this budget is yet to be approved by the Russian government which will only receive parts of the profit once the operators recoup their investment costs. Some observers note that Russia is not just trying to renegotiate the terms of the contract but that these charges are in effect an attempt to take over the control of the project and further consolidate the Russian natural resources in the hands of the state.
It seems that the press finally milked the Litvinenko case to the fullest, so it’s time for a review. BBC presents a timeline of the Russian ex-spy case.
On December 4, The Financial Times printed a comment by John Lloyd and Alex Turkeltaub titled “India and China are the only real Brics in the wall” (subscription required) arguing that “while the rise of China and India represents a real shift in the power balance, Russia and Brazil are marginal economies propped up by high commodity prices.” BRIC is the abbreviation for the four large emerging economies Brazil, Russia, India and China. Ironically, the next day, the already red-hot Russian stock market reached a new all-time high in spite of the negative publicity surrounding the poisoning of Alexander Litvinenko.
The Litvinenko affair is damaging the relations between Russia and the UK, claims Sergei Lavrov. When we take a look at the headlines of mainstream Western periodicals, claims to the contrary by the British foreign ministry cannot be taken too seriously. The case is hurting the relations between Moscow and London, and Moscow and the West in general. For the first time in his presidency, Putin is facing a serious challenge to his authority and his management of Russia’s foreign relations. Not in his home country, of course, where the Litvinenko’s case is viewed mostly with indifference, but in the West where the fears of Russian threat that lay hidden for 15 years came alive over the two weeks.
This presents Putin with extraordinary difficulty because it strongly undermines his efforts to use the stick and carrot strategy to keep the West complacent about his rule in Russia. Until recently, he had been quite successful with his clever tactics of linking up with the West on some issues like the global war on terrorism and softly bullying his European neighbors with an ever subtle threat of their dependency on Russian natural resources. His tactics worked especially well in today’s world of constant geopolitical uncertainty, and Russia’s rise as an economic power riding high the recent boom of commodity prices. This maneuvering bought Putin the West’s relative silence on his questionable handling of the Chechen war, the de-facto renationalizing of Russia’s strategic industries, and the increasing consolidation of power in his hands.
It is ironic that none of these episodes have raised the level of controversy that Litvinenko’s poisoning did. But at the same time is understandable from the perspective of the Western public. Russia is far away from London, and the impact of its actions at home is not visible. Russia does not threaten the world with nuclear annihilation; while it disrupts the supply of natural gas to Ukraine and to Georgia, it is a reliable partner to the Western countries; and Western investors are earning millions on rising Russian stock market. An assassination of a British citizen (albeit of Russian origin) with a radioactive substance has changed the complacency. If this can happen to one of ours in Mayfair, can we really feel safe, people start thinking.
And while this episode on its own may not have accounted for more than a second page story in a second rate paper (the issue of Kremlin’s involvement is at best questionable), in combination with the events in Russia that may have been overlooked for the past years, it creates a combustible mix. Therefore, the hysteria in Western media is not only about Litvinenko and his horrible death. It is about the path that Russia has found itself on following Putin’s election in 2000. The attitude towards Russia in the West, as reflected in the media, is tilting fast, and Lavrov is right about the damage it has caused.
The British intelligence forces claim that the Litvinenko poisoning was orchestrated by the FSB, The Times report. This “new” theory comes to light as a team of British investigators is in Russia following the trail of Polonium-210 that killed Litvinenko in London. The British team has probed the British embassy in Moscow where the British authorities interviewed two Russian businessmen regarding potential clues into the casefor any traces of radiation. The Russian authorities are not as cooperative as initially suggested, the CNN reports with a loud headline ("Spy death probe police 'thwarted'") and will not allow the British detectives to question Mikhail Trepashkin, a former FSB officer who has been jailed in 2003 for allegedly divulging state secrets. They will also not be able to question Andrei Lugovoi, a former FSB officer who met with Litvinenko in London, as he has been hospitalized for a second time to be tested for radioactive poisoning. However, as The Observer notes, even if the British authorities were able to establish who is guilty of poisoning the ex-spy Litvinenko, there is no guarantee that the person would ever serve jail time in the UK.
“There is no bilateral extradition treaty between Russia and the UK, and legislation passed by Russia to deal with one-off requests by European countries prohibits the extradition of its citizens. When signing up to the European convention on extradition in 1996, Russia granted itself an exemption in accordance with article 61 of the state's constitution, which says: ‘A Russian citizen cannot be sent beyond the borders of the Russian Federation or given to another state.’"
The number of conspiracy theories about the death of Alexander Litvinenko increases by the day. They come from a variety of sources and each party uses them to drive their own political agenda. The state media are blaming the London émigrés, the dissidents are blaming President Putin, the Western media are blaming the FSB, Zhirinovski is blaming foreign intervention. However, as The New York Times writes, conspiracy theories are easy to come about in Russia where the press freedom is severely restricted and the authorities have not been able (or willing? – another conspiracy theory) to shed light on a number of controversial cases plaguing the reputation of Russia and if the current Kremlin establishment.
TIME Magazine discusses the Russian minority in London.
“Why cold, damp London for a second home? Unlike the U.S., Britain doesn't generally tax the income of resident foreigners unless they bring it into the country. Compared with the rest of Europe, Britain is seen as a country free of red tape, where it's easy to start a business. It's thought to be safe and cultured and a great place to educate children. Plus it's just four hours by air from Moscow.”
As the British investigators have left for Russia to investigate the Litvinenko poisoning, Russian Foreign Minister Sergey Lavrov warns against politicizing of the case, BBC reports.
We may never know whether Putin was actually responsible for the recent murders of Litvinenko and Politkovskaya. However, we know that they happened on his watch, while he firmly took hold of power in the Kremlin. And his claims that he restored the rule of law in Russia sound increasingly hollow. more…
The Economists examines the relationship between the two neighboring powers, Russia and China. Following their own version of cold war that ended in 1989, their relations are at an all-time high. That has to do with their common stance on American foreign politics, as well as with China's growing hunger for natural resources, and Russia's need for cheap imported goods. However, as the article suggests these factors that make Russia and China ideal partners also make their alliance rather fragile. "[...] the interests now drawing them together contain the seeds of future competition, even conflict."
The Exile shows a view of Alexander Litvinenko that is different from the mainstream Western publications.
The New York Times retraces the steps of Alexander Litvinenko back to 1994 uncovering his special relationship with Boris Berezovsky, his spat with the FSB in the late 1990's and the last years of his life living among the large community of Russian emigres in London.
Ahead of the presidential election in 2008, the choice who will be the next president will not be made by the people but rather by the competing factions of Russia's ruling elite, according to Washington Post's columnist Masha Lipman.
The recent poisoning affair threw the lives of the superrich residents of London’s prestigious neighborhood Mayfair into turmoil, The Washington Post reports. They have lived in a pleasant coexistence with Russian refugees ala Berezovsky, Russian émigrés who fled to London to protect their fortunes from the reach of Vladimir Putin. However, Alexander Litvinenko’s poisoning showed the dark side of the newcomers. And now, the upscale sushi joint Itsu is closed, you can’t get a cocktail at the Pine Bar at the Millenium Hotel, and the Polonium trail is crisscrossing the neighborhood. You don’t want to leave your Rolls-Royce – it’s so shocking.
In an, to say the least, interesting chain of events, Forbes Russia December edition will hit the stands after all. However, the editor Maksim Kashulinsky resigned to protest against Axel Springer's original decision to pull the magazine at the last minute and apparently made it clear that the story will not end there. What happens next remains to be seen.
Kashulinsky was the successor of Paul Klebnikov, Forbes Russia's first editor, who was shot dead in 2004 while leaving his Moscow office.
CNN Headline: Mario Scaramella, the man who met with Alexander Litvinenko in a sushi restaurant in London, has tested positive for radiation. While the exact quantity of Polonium-210 in his body has not been disclosed, Scaramella has been hospitalized to be further tested. More…
Mikhail Trepashkin, a former FSB officer, said he warned Litvinenko in 2003 that he and other Kremlin opponents were targeted by a government-sponsored death squad, The New York Times reports. Trepashkin is serving a 4-year sentence for divulging state secrets while investigating claims that the FSB and not the Chechen separatists were behind the deadly apartment bombings in Moscow in 1999. Litvinenko alleged FSA involvement in the bombings in his book "Blowing up Russia: Terror from Within", published in 2002.
RIA Novosti reports that the December issue of Forbes Russia was pulled from circulation by its publisher, Germany’s Axel Springer, due to a controversy over a 7-page article about Yelena Baturina, the wife of Yuriy Luzhkov, the mayor of Moscow. Baturina is the founder and head of Inteco, a real estate investment and construction company in Moscow, that has been fighting accusations of corruption because the company was awarded a disproportionally large number of municipal contracts since Luzhkov became the mayor in 1992. According to Forbes, Baturina’s estimated net worth is $2.3 Billion and she ranks 335th on Forbes’ list of richest people.
