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Moskovsky Komsomolets
The war between the Kremlin and human rights activists
The all-out war that erupted unexpectedly between the Kremlin and human rights activists after the New Year holidays is no more than a facade covering up another conflict. This conflict is seething deep inside the Kremlin and its stake is the future of the Russian establishment after 2008 and the country's future political line.
Most of Russia's political players have grown accustomed to Putin's firm determination to step down as president in 2008 and everyone is trying to guess what he will be doing when his term ends. But there is a group of high-ranking officials from the law-enforcement clan (known as the siloviki) for whom this event spells disaster. Even if a liberal successor like Medvedev becomes takes the helm, he will lose the lion's share of the influence of the siloviki, at the very best.
They have only one path left now - to act on "the better the worse" principle: to put Putin at odds with the West and whip up tensions in any way possible.
What will they gain? Russia may turn into a country where even a relatively democratic handover of authority may become impossible. Or a yet unknown candidate for president from the siloviki may become the front-runner in the race of "successors".
On January 1, Russia took over the rotating G8 presidency. It is in the country's interests to get through this year without any scandals. Instead, we began first with the gas war with Ukraine, which shocked the West. Then, after accusations of spying against UK diplomats, Putin's relations are spoilt with his key western partner, British Prime Minister Tony Blair. Attacks on human rights defenders are abundant. The West seems to be being tested here - when will it lose its patience and declare Putin an enemy of the civilized world?
Putin appears to have made himself a hostage to fortune by hiding behind the present Russian administrative system. When one person holds all the government powers, he is physically unable to sort it all out.
Russia is slowly but surely heading towards self-isolation and confrontation with the West.
Itogi
Russia and its unrequited love for PACE
Debates on Russia's need for the Council of Europe grew especially tense during the winter session of the Council's Parliamentary Assembly (PACE), which discussed a package of anti-Russian issues. Russia can engineer PACE's collapse by withdrawing from it, but in this case it will have to become closer with the European Union in order to keep its European identity, something which it is not ready to do.
For the first time since the fall of the Berlin Wall, Russia has a chance to play with high stakes in the European game of political poker. Its aces are oil and gas, as well as the shift of the European center of gravity from Strasbourg to Brussels. The EU is pushing back the Council of Europe by creating a human rights commission and planning a supranational court.
So far, the fragile balance is being maintained largely thanks to the European Court of Human Rights operating under the Council. Like in Darwin's survival of the fittest theory, it is the strongest who wins in politics. The strongest in Europe is the EU, which has most of Europe's money, and money is power.
The speed of the Council's demise hinges on Russia, because the Council would become meaningless without Russia, the only major European player who is not an EU member.
Moscow has not decided yet if it wants to integrate into the EU.
"Renouncing a part of sovereignty by joining the EU is unacceptable to Russia, which is creating a sovereign democratic state," said Mikhail Margelov, a member of Russia's Federation Council (upper house).
But Russia wants to be a European nation, which is why it needs the Council of Europe. It may vie for the post of PACE speaker in January 2008. Russia may get a rotating chair as the biggest European state despite the negative attitude of some Council members. Moscow's money is another vital instrument for influencing the Council. By becoming Council president, Russia will strengthen its positions in the dialogue with the EU on the exclusive terms of its integration into the common European space.
Kommersant
Russian premier of Chechnya may resign in favor of Ramzan Kadyrov
Prime Minister of Chechnya Sergei Abramov, who is being treated in a hospital after a car accident last November, will not return to the Chechen capital of Grozny, apparently ceding power to First Deputy Ramzan Kadyrov.
If approved as prime minister, Kadyrov will be given carte blanche in governing Chechnya, observers say. Analysts hint that Ramzan is unlikely to stay head of government for a long time and could become president as soon as this fall.
Since an ethnic Chechen in control of the regional administration would break Moscow's so-far firm strategy of securing this position for a Russian, the intense horse-trading for future premiership involves, apart from Kadyrov, Oleg Zhidkov, chief federal inspector for Chechnya, a senior Grozny official told Kommersant.
A competent source in the federal government also said the Kremlin would hardly be promoting an outsider because "the election has been successful, the parliament is working, the war as such is over and stability factors are visible," the same message that Zhidkov sent recently.
"Chechnya is becoming a normal region and does not need special care any more," he said.
A competent source in Chechnya said Abramov's resignation would finally bridge the gap between official and actual reality in which Ramzan is the only source of power in Chechnya, and the president and prime minister are largely figureheads. "Ramzan is sick of pretending that not everything depends on him," he said.
On October 5, Ramzan Kadyrov turns 30, which removes the constitutional age barrier that has prevented him from running for regional president. Kommersant's sources in Chechnya do not doubt Russian President Vladimir Putin will approve the appointment.
Moreover, according to another source, Abramov might have his own good reasons to resign as he risks becoming a scapegoat when and if the massive embezzlement of rebuilding funds appears on the public agenda.
"The government will want to look at the results of the 98 billion rubles ($3.49 billion, or 2.88 billion euros) invested here since 2000. In fact, the only thing visible is new gas stations, shops and other results of private - mainly Ramzan's - investment activity."
Vedomosti
Siemens acquires blocking stake in Silovye Mashiny
After several years of unsuccessful attempts, Siemens has finally managed to acquire a blocking stake in Silovye Mashiny, a leading Russian producer of railway and transport machinery, and power station equipment. Siemens and Interros closed the deal on January 30.
Siemens agreed to buy a 73.46% stake in Silovye Mashiny shares from Interros 18 months ago. The Federal Antimonopoly Service (FAS) did not approve the deal. However, the FAS was more amenable to the idea of Siemens gaining a blocking stake, and approved this deal in December in around a week.
The German company paid $93 million for a 20.61% stake. This deal is similar to the recent sale of 22.43% of Silovye Mashiny to UES (Unified Energy Systems) for $101.4 million. As a result, UES and Siemens have both consolidated stakes of 25% plus one share.
Silovye Mashiny's market capitalization has grown 44% since early January totaling $810 million on January 30.
A Siemens spokesman said the company would not move to increase its stake in Silovye Mashiny until Russian authorities pass a law on involving foreign investors in strategic enterprises.
"The partners hope to list Silovye Mashiny shares in the blue chip category," Sergei Batekhin, deputy Interros general director, said. The company hopes to fulfill more contracts with the help of UES, and to boost product quality with the help of Siemens. "We hope to receive Siemens licenses for the entire range of its gas turbines," Batekhin added.
"The state will virtually control Silovye Mashiny via UES," Antanta Capital analyst Ilya Makarov said.
"Interros, having handed its 30.4% stake to the UES management until 2008, will probably not want to exert a significant influence over company's development. By managing this asset, the state will be able control the disbursement of budget funds which Silovye Mashiny will obtain in large volumes through the construction of new power networks and stations, and the transmission of additional power to China," the analyst said.
Biznes
Duma clears Gazprom's way to become No. 1 world energy company
Russian lawmakers are considering lowering mineral resource tax for companies exporting natural gas to certain neighboring countries, a move that experts say will benefit only Gazprom, the sole exporter of Russian gas.
Amendments to the Tax Code submitted to the lower house of parliament yesterday come as the result of other proposed changes involving re-imposition of the VAT on exports of Russian-produced natural gas to GUAM, (Georgia, Ukraine, Azerbaijan, and Moldova).
Russia ceded the right to collect VAT from CIS countries who received its energy in a politically motivated "carrot campaign" several years ago, but decided to turn back to sticks last December, as the dispute with Ukraine unfolded into a crisis. The Duma sent a memo to the head of government, asking him to rethink the tax-sharing scheme and to start collect VAT for gas exports to Ukraine. The author of the memo, Valery Yazev, estimated the loss resulting from the tax relief $1.24-1.28 billion per year, and linked the growth in mineral resource tax and the 23% growth in internal gas prices to Russia's strategy of increasing gas exports.
Dmitry Mangilev, an analyst with Prospekt brokerage, said the bill, "which is likely to be passed," will in any event do no harm to Gazprom's profits.
Mikhail Armyakov, chief analyst at RIM brokerage, says the government is lowering Gazprom's tax burden.
"What we can see right now is a practical move toward the long-cherished goal of creating the world's largest energy company," he said.
Novye Izvestia
Russians do not blame Putin for Kremlin blunders
Not even tragedies and crisis situations resulting from the Kremlin's errors can undermine Russians' trust in the president. The Russian people do not associate state policy setbacks with their leader, political scientists say.
The Levada Center has conducted opinion polls, each involving around 1,600 respondents, since Vladimir Putin emerged as Boris Yeltsin's political successor.
Putin was supported by 70-77% up until August 2000. His popularity hit an all-time low of 60% after the Kursk submarine disaster. Many other disasters have occurred since. Federal leaders are also responsible for numerous catastrophes. However, Putin's popularity ratings have never dropped below 60%.
Putin has also made managed to please the nation on several occasions. The president was supported by 75% of poll respondents in early 2003. The situation changed after Mikhail Khodorkovsky's arrest in November 2003, which sent his rating soaring to 82%.
In 2005, 42% of respondents said they saw no alternative to Putin. However, last year only 16% said that Putin's popularity was due to the successful solution of problems facing the country.
The latest January 21-24 poll estimates Putin's popularity ratings at 71%, with 27% of respondents disapproving of his policies.
Alexei Makarkin, deputy director, Center for Political Technologies, said: "This traditional Russian phenomenon of 'a good tsar and bad boyars' implies that the people of Russia, who bear a grudge against the authorities, want to turn to someone for help and protection. They need to personify their hopes and to associate them with an individual. It is hard to count on any party, members of parliament, or on ministers. However, the president is a different matter. Our people also used to rely on Stalin and Yeltsin."
