Robert Amsterdam

In Vladivostok they have carried out a search in the apartment of PrimorskyKray governor Sergey Darkin

By Grigory Pasko, journalist

The new configuration of power in Russia has demanded new personnel victims. I, like the majority of Russians, couldn’t care less about all those Sokolovs-Kudrins-Khristenkos… Not a single thing in even a single area of the life of Russia ever depended on them, after all. They – are puppets. And the puppet-masters, as a rule, do not light up on the screens of televisions. They decide the fates of these puppets behind the tightly closed doors of Kremlin offices and offices on Staraya ploshchad [where the presidential apparat is located—Trans.]

PHOTO: Sergey Darkin at the controls of an aircraft. He tried so hard to be like Putin. It didn’t help…

Continue reading "Grigory Pasko: Another Victim of Personnel Reshuffles" »

Earlier this week, Ariel Cohen of Heritage had a controversial opinion article run in the New York Post, which despite its aggressive house rhetoric, makes a pretty strong point:

Russian leaders, more anti-American today than ever, have written the book on using money and energy muscle to buy friends and influence neighbors. They made an example out of Ukraine, by cutting gas supply to it on New Year's Day for four days.

They also intimidated France and Germany into bucking the US at the Bucharest NATO summit and objecting to Georgia and Ukraine being issued a North Atlantic Treaty Association membership plan.

Russia's Gazprom has hired former German Chancellor Gerhardt Schroeder as the Chairman of a pipeline consortium, and made a similar offer to former Italian Prime Minister and the top Eurocrat Romano Prodi. Vladimir Putin does brisk energy business with Silvio Berlusconi, and with the French President Nicolas Sarcozy, though both are considered pro-American. German businessmen enthusiastically lobby Chancellor Angela Merkel on the Kremlin's behalf. Russia, some argue, has more clout today in Europe than Washington.

Continue reading "Over a Barrel" »

I found this article about Canadian police psychologist Mike Webster, who has compared the RCMP (the Mounties) to Putin's Russia, very interesting. Although having been arrested by the political police in Moscow at one point, I would say that at least the Canadians usually wear their uniforms... These kind of broad swipe comparisons of "Putin's Russia" shouldn't be dispensed so liberally.

“As a psychologist, I know it's not healthy for people to live in such an oppressive climate,” Mr. Webster said. “Being a member of the RCMP today is like being part of Putin's Russia; they don't tolerate any opinion that doesn't reflect the party line.”

A devastating charge. Mr. Webster currently has a one-year contract with the Mounties. After it expires next April, he has no idea if more work will be offered to him.

“I find it offensive that I'm expected to park my morals at the door if I'm going to be part of the organization,” Mr. Webster said. “If that's what it means, I won't do it. I just won't.”

Pierre Noël of the EPRG (Cambridge University) and the European Council on Foreign Relations has an opinion column in the Financial Times today calling on Europe to create a single market for natural gas:

The idea that Europe lacks, or will soon lack, access to a diversified and secure (read: non-Russian) natural gas supply is not backed by the data. Even as Russia expanded exports to Europe, its share of European imports (for the 27 current member states) has roughly been halved since 1980, from 80 per cent to about 40 per cent. Since 1990, 80 per cent of the rise in EU gas imports has been from non-Russian sources. Europe already enjoys a diversified natural gas supply. Russia’s failure (or unwillingness) to develop its resource base and expand exports to Europe is bound to make the European market all the more attractive for other exporters in the coming years – though it will also mean higher prices.

Continue reading "A Single Gas Market for Europe" »

This week President Dmitry Medvedev delivered a speech to senior officers of the FSB, presenting the new chief Aleksandr Vasilyevich Bortnikov, while thanking Nikolai Patrushev for his years of (controversial) service. Among other comments, Medvedev said that the FSB has a duty to protect Russia from religious and racial intolerance, and that the spy agency should continue to play a very strong role in the economy: "Our country’s economic security faces serious challenges. I am referring to protecting the Russian economy from corruption, criminality and industrial espionage, as well as to strengthening the safeguards for entrepreneurial activity and property rights. All actions taken by security agencies in this field should be strictly based on existing legislation. Aleksandr Vasilyevich has served as Director of the FSB Economic Security Service for a while. I am sure that he will keep a close eye on this aspect of the FSB’s activity."

Lately it seems unclear whether or not all of BP's problems with its Russian subsidiary TNK-BP, which have included arrests, office raids, and visa problems, are related to a campaign from the government to take over a majority stake - or rather just enduring conflicts with their private sector Russian partners, the immensely powerful billionaires Len Blavatnik, Viktor Vekselberg and Mikhail Fridman. Many have observed these moves from the Kremlin as a prelude to expropriation, but a new report from the Wall Street Journal speculates that all of TNK-BP's problems may just be infighting among shareholders - shareholders who frequently can wield powers of the state to pressure each other.

My view: we can see that in an effort to discourage Blavatnik, Vekselberg, and Fridman from selling stakes to state-owned firms, that BP is pushing hard for an enormous cooperation agreement and asset sharing partnership with Gazprom - probably along the lines of what happened to Eni. It seems a frequent negotiating tactic for Gazprom to corner the multinationals into these kind of deals, appearing as the savior and guardian angel to the very problems they themselves are creating. However, when corporations are under the gun to align themselves with the monopoly, it is consumers and competition who become the real victims.

Gregory White and Guy Chazan report:

Continue reading "Is TNK-BP a Resource Nationalism Case?" »

The government has awarded Gazprom the rights to develop nine northern gas deposits without a tender. Prime Minister Vladimir Putin has urged the government to formulate a number of tax preferences for oil producers, including the reduction of mining tax and tax holidays for companies developing new fields. Putin and new Energy Minister Igor Sechin are reportedly trying to refute claims that the country's oil production is in decline. BP’s Chief Executive will meet with three of the Russian billionaires who control half of its Russian energy venture, TNK-BP, amid speculation that the venture’s recent problems are due to friction between shareholders. Read more on their latest visa issues and staff being blocked from returning to work. Former electricity monopoly UES will sell power firm TGK-7 to billionaire Viktor Vekselberg and Gazprom. The company will also sell its 29% stake in power producer TGK-11 to engineering firm E4 Group.

A new report by a Moscow brokerage reveals that the global credit crunch will knock about $12 billion off the amount likely to be raised through Russian initial public offerings this year. Russia's gold and foreign currency reserves increased by $2.9 billion, to $536.8 billion, in just one week. A new report shows that Russia, along with China, Brazil and other emerging economies, is becoming a bigger customer for the pharmaceuticals industry as it invests more in treating and diagnosing cancer. Deputy Finance Minister Dmitry Pankin says the government needs to lock up to $50 billion in its sovereign wealth fund for five to seven years to make portfolio investment in foreign shares feasible. Dmitry Medvedev has told his new government to step up efforts to help small and medium-sized businesses “choked by red tape and corruption.”

TODAY: New Cabinet aims to undercut siloviki power, meets for the first time today; photo exhibition celebrates Putin’s Presidential rule; Human Rights Commissioner deems protest ban “unlawful”; cooperation with Europe on moon visits; emphasis on Russia-Germany relationship.

Former security insiders say that the set-up of the new Cabinet is “aimed at undercutting the power that political clans within the security services have accumulated in recent years,” and completely reverses the reforms conceived by former Kremlin deputy chief of staff Dmitry Kozak several years ago. Putin will hold the first meeting of his new Cabinet today.

Germany’s foreign minister, Frank-Walter Steinmeier, was the first foreign official to hold talks with President Dmitry Medvedev and Prime Minister Vladimir Putin since they took up their new positions. Medvedev will return the visit next month, highlighting Russia’s relationship with Germany as a top priority.

Continue reading "RA's Daily Russia News Blast - May 15, 2008" »

In just five years, a shadowy Geneva-based firm by the name of Gunvor has become the third largest oil trader in the world, projecting revenues of $70 billion this year. The Financial Times has a very interesting piece which takes a look at how such a small company was able to achieve this improbable level of growth, and even links some of the main shareholders back to corruption scandals and questionable deals in the past. Gunvor, controlled by Gennady Timchenko, a close friend and judo partner of Vladimir Putin, was one of the principal beneficiaries of the unlawful breakup of Yukos. It is a must read.

In this news clip, Armen Keteyian of CBS News investigates the activities of the Russian mafia in the United States, everywhere from Atlantic City to Newark to Brighton Beach...

From an editorial in the IHT:

Now Steinmeier has one-upped himself, refusing to meet with the Dalai Lama when he comes to Germany on Friday, while Merkel is out of the country. The Foreign Ministry said Steinmeier was too busy. He did find time to go to Russia - the first senior European official to congratulate the new president, Dmitri Medvedev, and the new prime minister, Vladimir Putin. (...)

Steinmeier's defenders will undoubtedly argue that "quiet diplomacy" is better than well-publicized public meetings. But meeting leaders like the Dalai Lama, and trying to mediate between him and Beijing, is what foreign ministers are supposed to do. Steinmeier's record, in this government and under Chancellor Gerhard Schröder, is one of appeasement, whether it be China, Putin or Uzbekistan's Islam Karimov. If he has been involved in quiet diplomacy, it is hard to find evidence of it in any of those countries.

Read more about Steinmeier here and here.

From Theo Caldwell of the National Post:

It must be terrifically tempting, in such a society, to keep one’s head down to stay out of trouble. As Aleksandr Solzhenitsyn observed in his seminal chronicle of the Soviet Terror, The Gulag Archipelago: “Every man always has handy a dozen glib little reasons why he is right not to sacrifice himself.”

One of the graces of Russia’s new repression is that many of its excesses remain public, for those who care to look. Among Solzhenistyn’s laments as the Terror progressed was that, after a few well-known and public trials, the courts and tribunals became closed-door operations, while society trudged along in tragic ignorance. That is, until their turn came.

Theo might have wanted to check in on today's Solzhenitsyn before using quotes sympathetic in his portrayal.

Later today Bob will weigh in with his views on the latest cabinet appointments, but those hoping for a full siloviki purge, they'll have to keep holding their breath. Igor Sechin, chairman of Rosneft and a powerful figure in the Kremlin, will enjoy continuing broad powers over the energy, industry, and natural resources sectors in his new post as Deputy Prime Minister.

Most everybody we spoke to had assumed this would be the case, as Sechin has quite a solid base of support for the time being, and was not going to be easily moved out.

What is interesting are these reports announcing that Sechin has also been made chairman of the United Shipbuilding Corporation, heading up a $12 billion enterprise established by Putin last year, taking over from Sergei Naryshkin - who is now going over to work under Medvedev (at one point it was speculated that Naryshkin could vie for the presidency).

Seems pretty wild to have just one man controlling Russia's largest oil company as well as the country's shipyards, where energy transport fees will become an incredible revenue generator in coming years.

Prime Minister Vladimir Putin has announced that his deputy, Igor Sechin, will manage a multibillion-dollar project to give Russia a modern fleet of ships for its "flourishing" energy sector. High oil prices are putting a strain on US oil refiners, forcing them to cut production rates. BP's Russian venture, TNK-BP, says court action by a small Moscow brokerage has stopped it from using key specialist staff. Zarubezhneft has confirmed plans to join forces with Vietnam's state-owned oil producer, PetroVietnam, in developing Arctic fields in Russia. Ukraine’s energy costs are now “significantly higher than for Russian peers, but most have retained a competitive edge over European counterparts”. The European Commission has ordered an in-depth investigation into plans by Norway's StatoilHydro to buy 274 automated petrol stations in Norway, Sweden and Denmark from ConocoPhillips.

A new survey of business graduates suggests that the reputations of key emerging markets, including Russia, Eastern Europe and Asia, “discourage the best talent from working there.” State arms exporter Rosoboronexport is preparing a $4 billion arms contract with Saudi Arabia. International department store chain Stockmann closed its flagship Moscow location until further notice, following a rental dispute. Doninvest Group, the Russian partner of Hyundai Motor Co., will build a $650 million auto-parts factory in South Korea. The Moscow Times suggests some strategies for combatting inflation - could the answer lie in the Federal Reserve? Mobile phone operator MegaFon could invest around €3 billion ($4.64 billion) to build a GSM network in Iran. The Kurdish and Russian chambers of commerce have signed a protocol of agreement in Erbil, which could lead to more active investment between the two. The government “faces an uphill battle as it seeks to promote Russian business abroad in the face of widespread fear of overdependence on the country's politicized economy.”