Russia

Russia 091203Basic Political Developments

· ISRIA: Turkmenistan - Dmitry Medvedev to attend inauguration of Turkmen-Russian school in Ashgabat

· Itar-Tass: Russia-Israel commission resumes work after three-year interval

· RIA: Russia's Medvedev arrives in Rome for bilateral talks

· Bloomberg: Fiat May Make Cars, Commercial Vehicles in Russia, Ansa Says

· Interfax: Medvedev starts visit to Italy

· Examiner.com: Russian Orthodox release book with words of Pope Benedict

· Interfax: Medvedev and Benedict XVI will discuss international problems, dialog between various cultures and religions and cooperation in the field of humanities

· Reuters: Orthodox, Catholic Faiths Inch Closer

· CatholicCulture.com: New hints of movement toward Vatican-Moscow 'summit'

· Reuters: HIGHLIGHTS 2-Russia's Putin: annual Q&A session

· BBC: Putin urges train bomb response - Russian PM Vladimir Putin has called for tough measures against those behind the bombing of a Moscow-St Petersburg train in which 26 people died.

· Itar-Tass: Eight cities to speak directly with Putin

· RIA: Putin set for televised Q&A session

· Russia Today: PM on the line – live Q&A with Vladimir Putin

· Reuters: Russia recession likely to dominate Putin phone-in

· RIA: NATO meeting to address key issues on alliance's agenda

· Interfax: James Appathurai: NATO wants to discuss missile defense with Russia and plans to cooperate with Russia in tackling the problem of Afghanistan - NATO plans to discuss missile defense problems with Russia at a NATO-Russia Council meeting on December 4, NATO Spokesman James Appathurai said in an interview with Interfax.

· RIA: Russia, U.S. could sign new strategic arms deal by yearend — expert

· FOX News: NSC Adv Jones upbeat on new START deal

· NY Times: Arms Treaty Likely to Expire Before New Pact Is Set

· Xinhua: Russian climate expert praises China's emissions cut goal - Alexei Kokorin, head of Russia's climate change program of the World Wide Fund for Nature, spoke highly of China's announcement to reduce the carbon dioxide emissions per unit of gross domestic product by 40 to 45 percent by 2020 from the 2005 level.

· News.az: Azerbaijan recorded the highest GDP of the CIS countries in January to October this year, 8.2%.

· Focus: Greek press: Greek-Russian and Greek-Turkish talks on Burgas-Alexandroupolis and shelf

· RIA: Bulgarian environmental concerns cast doubt over Russian pipeline

· Petroleumworld.com: Russian oil pipeline hits snag in Bulgaria: minister

· The Moscow Times: Shmatko Faces Tough Talks in Sofia

· Russia Today: Nuclear power comes through with cash - The world’s largest nuclear power firm says it's had no trouble placing a billion dollar plus bond issue, despite investor caution, saying that Russian state ownership gives it stability that many rivals lack.

· The Jamestown Foundation: Russia Seeks to Sustain its Energy Security

· ISRIA: Beginning of Meeting of Russian President Dmitry Medvedev on Economic Issues (2 December 2009)

· Kudrin still not favoring state monopoly over alcohol production (Part2)

· Xinhua: Greece, Russia sign joint action plan on economic cooperation

· The Nation: Thaksin in Russia: Payap

· Spaceflight Now: Russia delays Angara rocket debut as testing progresses

· Defpro.com: Rosoboronexport to present aerospace, air defence and naval capabilities at LIMA 2009 

· BERNAMA.com: Inter-Regional Muslim Forum Opens In Perm

· The Jamestown Foundation: Deadly Crash of Nevsky Express Revives Fears of Past Bombing Campaigns

· RIA: Massive oil leak in central Russia

· Itar-Tass: Oilspill of about 200 tonnes occurs in Lipetsk region-RME

· RFERL: Tajik Citizen Wins European Court Case Against Russia

· RIA: Tajik national, children found dead in Moscow apartment

· RFERL: Top Russian Judges Quit Posts After Critical Comments

· Telegraph.co.uk: Judges forced out after accusing Kremlin of hijacking judiciary

· Online.wsj.com: Judge Set to Retire Amid Kremlin Row

· Guardian.co.uk: Rising oil price refuels Russian taste for fine art

· FT.com: Russian tycoon finds limelight a little bright - Viktor Vekselberg, the Russian tycoon who bought the Forbes family’s collection of Fabergé eggs, has avoided the financial pitfalls that have hurt many of his fellow oligarchs during the credit crunch.

· Fox11AZ.com: Activists urge Kremlin to stop building resort

· The Moscow Times: Ministry Readies Tax Haven Curbs

· Blogs.reuters.com: Time to kick Russia out of the BRICs?

· RIA: What the Russian papers say - Medvedev's proposal for new European security treaty a compromise between Russia, West / Row darkens upcoming NATO-Russia meeting / Menatep gets chance to sue Russia for billions of dollars / German concern asks Gazprom to review long-term gas prices /

National Economic Trends

· RIA: Russia's GDP decrease in 2009 to exceed predicted 8.5% -- Kudrin

· Bloomberg: Russian Service Industries Grew for Fourth Month (Update1)

· RenCap: Rouble weakens on the back of accelerated budget spending expectations in December

· RenCap: Reserve Fund in November

Business, Energy or Environmental regulations or discussions

· Bloomberg: Polymetal, Rosneft, Sberbank, Sitronics: Russian Equity Preview

· Russia Today: RusHydro posts 1H 2009 Net Profit of 17.85 billion Roubles

· Citibank: Agriculture: Fertiliser Demand Rebounds in 4Q09

· Bloomberg: Hong Kong Exchange Committee Said to Review Rusal IPO on Dec. 7

· AFP: Rusal's IPO plan in Hong Kong faces new delay

· Guardian.co.uk: Deripaska and Rusal come back from the brink

· Reuters: Russian banks' loan portfolio remains flat-FinMin

· RBC: Vnesheconombank may become joint-stock company next year

· BusinessWire.com: Sistema Completes The Sale Of A Controlling Stake In Sistema-Hals To VTB Bank

· Online.wsj.com: Sistema: VTB Owns 51% Of Sistema-Hals After Exercising Call

· RenCap: Rostelecom to be delisted from NYSE?

· RIA: Russia's top air carrier denies fuel shortage rumors

· Reuters: Russia still on radar of global retailers-PwC

· Reuters: FACTBOX-Key facts about Russia's retail sector

· Interfax: Globaltrans consolidated net profit falls 63.3% in Jan-Sept

Activity in the Oil and Gas sector (including regulatory)

· RIA: Oil spill in central Russia will not affect consumers - Transneft

· Rigzone: Tatneft Gets Go-Ahead to Develop South Kishma Oil Field

· RenCap: Russia: Nov 2009 gas production statistics

· RenCap: Russia: Nov 2009 crude production statistics

Gazprom

· Citibank: Gazprom (GAZP.RTS) - to swap gas for electricity in France

· UPI: Gazprom inks deal with Vologda Oblast

· Troika: Gazprom output shows signs of tangible improvement in November

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Full Text ArticlesBasic Political DevelopmentsISRIA: Turkmenistan - Dmitry Medvedev to attend inauguration of Turkmen-Russian school in Ashgabat

http://www.isria.com/pages/3_December_2009_42.php

President of Russia Dmitry Medvedev will visit Turkmenistan in late December, Russian president's aide Sergei Prikhodko said yesterday. According to him, "preparations for the visit are under way. The visit of the President of Russia to Turkmenistan is scheduled for the end of this year, in late December," ITAR-TASS said. Prikhodko added that "the purpose of the visit is to inaugurate the Russian school in Ashgabat."

It should be recalled that the foundation of the new building of the Turkmen-Russian secondary school named after Pushkin designed for 800 pupils was laid in 2007 by Presidents Gurbanguly Berdimuhamedov and Vladimir Putin.

The modern multi-story school building is being erected near Independence Avenue to the south of the Olympic Stadium. It consists of a three-story study facilities and a nine-story administration building. The construction is carried out by Turkish firm "Erku" and funded by Russian joint-stock company "Gazprom".

Russia-Israel commission resumes work after three-year interval

http://www.itar-tass.com/eng/level2.html?NewsID=14597642&PageNum=0

03.12.2009, 05.58

MOSCOW, December 3 (Itar-Tass) - The Russian-Israeli mixed commission on trade and economic cooperation resumes its work after a three-year interval, reported a source at the Russian government.

It will hold its seventh meeting in Moscow on Thursday which will be co-chaired by Russian first vice-premier Viktor Zubkov and Israeli vice-premier and Foreign Minister Avigdor Liberman. The commission had the previous meeting in 2006.

The Russian government noted that the commission resumes its work against the backdrop of the successful development of the Russian-Israeli political dialogue. The sides continue the practice of annual Russian-Israeli summits and established contacts between the security councils, the foreign ministries and related ministries.

The cancellation of the visa barriers helped to form a favourable interstate atmosphere. The intergovernmental agreement on dumping visa formalities during mutual trips of Russian and Israeli citizens entered into force in September 2008.

Besides, trade and economic relations between the two countries were given a jab in the arm. In 2008, the volume of trade hit its maximum over all years of bilateral cooperation – 2.8 billion US dollars.

The source noted that the sides “laid down a rock-firm foundation, but it needs a superstructure, above all thanks to projects in the trade and economic sphere. This should be promoted by the Russian-Israeli intergovernmental commission”.

According to the source, the sides plan to give special attention to qualitative improvement of economic relations. The scheme “raw materials and fuel in exchange for machinery and equipment” has exhausted its potential and cannot serve as a reliable basis for developing relations. The global economic crisis showed vulnerability of this model: trade halved in January-July 2009, he continued.

The source called production cooperation, partnership in innovation activities, information technologies and communications, development of small and medium businesses as well as joint entrepreneurial activities, including in science-intensive spheres, as promising areas for bilateral cooperation.

The government source is sure that an agreement on encouragement and mutual protection of investments will be a good impetus to the development of investment cooperation.

Deliveries to Israel of Russian natural gas can be another topic at the coming talks, he added.

It is planned that results of the commission’s work will be recorded in a protocol. Its meeting is a logical continuation of Zubkov’s working visit to Israel on September 30-October 1, 2009.

RIA: Russia's Medvedev arrives in Rome for bilateral talks

http://en.rian.ru/russia/20091202/157074816.html

23:4402/12/2009

Russian President Dmitry Medvedev has arrived in Rome to discuss bilateral economic cooperation with Italian Prime Minister Silvio Berlusconi and meet with Pope Benedict XVI in the Vatican.

Medvedev will visit the Italian capital for the sixth round of broad intergovernmental consultations at the highest level, presidential aide Sergei Prikhodko said earlier on Wednesday, adding the Russian delegation will include a team of ministers and other top officials.

Economic cooperation will become the main focus of the bilateral talks, Prikhodko said.

After the consultations in Rome, Medvedev will pay a short visit to the Vatican in order to meet with Pope Benedict XVI and the Vatican secretary of state, Cardinal Tarcisio Bertone. The agenda of the talks is expected to focus on humanitarian cooperation. Medvedev will meet with the Pope for the first time.

ROME, December 2 (RIA Novosti)

Bloomberg: Fiat May Make Cars, Commercial Vehicles in Russia, Ansa Says

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=afBPC4sKo0bA

By Steve Scherer

Dec. 3 (Bloomberg) -- Fiat SpA may team up with OAO Sollers to make cars and commercial vehicles in Russia, Italian and Russian industry ministers said late yesterday, Ansa news agency reported.

The two carmakers are talking about a partnership to “create a new, big automobile producer, a new, large regional player,” Russian Industry and Trade Minister Viktor Khristenko said in Rome, according to Ansa.

Italian Prime Minister Silvio Berlusconi and Russian President Dmitry Medvedev meet today in Rome.

Last Updated: December 3, 2009 01:57 EST

Interfax: Medvedev starts visit to Italy

http://www.interfax.com/3/533969/news.aspx

ROME. Dec 3 (Interfax) - Russian President Dmitry Medvedev arrived

in Rome on Wednesday evening.

The primary purpose of Medvedev's visit to Italy is to attend the

sixth round of Italian-Russian expanded top-level intergovernmental

consultations.

Medvedev will have meetings with Italian Prime Minister Silvio

Berlusconi in a narrow and expanded format and will be present at a

ceremony of signing a number of intergovernmental and interagency

documents and investment contracts between Russian and Italian companies

on Thursday.

In the afternoon, Medvedev will visit Vatican City and meet with

Pope Benedict XVI.

Examiner.com: Russian Orthodox release book with words of Pope Benedict

http://www.examiner.com/x-30912-Cleveland-Eastern-Orthodox-Examiner~y2009m12d2-Russian-Orthodox-release-book-with-words-of-Pope-Benedict

December 2, 2:53 PM

The Russian Orthodox Church has today released a new book, one that has been published in both Russian and Italian. It contains some of the words of Pope Benedict XVI concerning European culture.

The media is already insistent on healing relations between Eastern Orthodoxy and Catholicism, especially with respect to the largest Orthodox Patriarchate--Russia. There are even rumors of plans for the Patriarch Kirill to meet with the Pope in a "neutral" location or even somewhere in Russia in the coming months. The new book pushes that all of Europe, East and West, is a "spiritual homeland" in many aspects of its culture.

Hieromonk Philip of the Russian Orthodox Church explained that this book is a "testimony of the absolute identity of views and positions between the Orthodox Church and the Catholic Church in regard to modern social processes." No matter what, it is sure to cause some high spirits and ill feelings amongst the debators of ecumenism in the Orthodox Church.

02 December 2009, 17:26

Interfax: Medvedev and Benedict XVI will discuss international problems, dialog between various cultures and religions and cooperation in the field of humanities

http://www.interfax-religion.com/?act=news&div=6702

Moscow, December 2, Interfax - Russian President Dmitry Medvedev will pay a brief visit to the Vatican on Thursday, he will hold conversations with Pope Benedict XVI and the Vatican secretary of state Cardinal Tarcisio Bertone.

Medvedev and Benedict "will possibly talk, in a broad context and without going into details, about the concurrence of the positions of Russia and the Vatican on the more acute international problems and will dwell on the issue of mutual understanding between various cultures and religions and on cooperation in the field of humanities," presidential aide Sergey Prikhodko told Interfax.

Earlier, Archpriest Igor Vyzhanov, secretary of the Department for External Church Relations of the Moscow Patriarchate, told Interfax-Religion that Medvedev's planned visit to the Vatican should not be seen as "a mediatory mission for bilateral relations between the Moscow Patriarchate and the Roman Catholic Church."

The meeting between Medvedev and Benedict "will be a meeting between two statesmen," he said.

"We discuss issues of bilateral relations between our churches by ourselves, directly with the Pope or Papal representatives. So it can't be a case of mediation by two state leaders in inter-church relations," the priest added.

Reuters: Orthodox, Catholic Faiths Inch Closer

http://www.themoscowtimes.com/news/article/orthodox-catholic-faiths-inch-closer/390813.html

03 December 2009

Reuters

The Russian Orthodox Church and the Roman Catholic Church are making progress toward healing their 1,000-year-old rift, a senior Russian official said ahead of President Dmitry Medvedev’s first visit to the Vatican.

But Medvedev will not invite Pope Benedict to make a historic visit to Russia when the two meet on Thursday because he believes that church heads should take the initiative, said the official, who refused to be identified.

“It is not appropriate for a secular leader to raise the issue in the absence of a hierarch,” the official said. “They [church leaders] should decide the issue themselves.

“However, a movement toward normalization is clearly seen, and things are moving in the right direction,” he added.

Visits by Russian leaders to the Holy See in the past have failed to help heal the rift between the churches. But new hopes emerged when Patriarch Kirill took power after the death of his theologically more conservative predecessor, Alexy II, last December.

Patriarch Alexy, who spearheaded the revival of his church after decades of Communist persecution, treated rival religions and churches with suspicion.

The Russian Orthodox Church has accused the Vatican of poaching for converts in its territory, including in Ukraine. The Catholic Church says it is only ministering to an existing flock of about half a million Russian Catholics.

The medieval Christian church split into Eastern and Western branches in the Great Schism of 1054 amid disputes over papal authority and the insertion of a clause into the Nicene Creed. The divide has never been healed.

Patriarch Kirill, who headed the church’s foreign relations department for many years before taking his present job, has shown less hostility toward Catholics than did Alexy.

German-born Pope Benedict, a theological conservative, is viewed by Orthodox hierarchs as a more welcomed partner than his predecessor, John Paul II.

CatholicCulture.com: New hints of movement toward Vatican-Moscow 'summit'

http://www.catholicculture.org/news/headlines/index.cfm?storyid=4781

December 02, 2009

On the eve of a meeting between Pope Benedict XVI and Russia’s President Dmitri Medvedev, there are new signs of substantial progress in relations between the Holy See and the Orthodox Patriarchate of Moscow, and hint that a “summit” meeting between the Pope and Russian Patriarch Kirill might be under discussion. The Russian Orthodox Patriarchate of Moscow has published a collection of speeches by Pope Benedict XVI, and a government official in Belarus has suggested that his country might be an appropriate place for the much-anticipated ecumenical summit.

The new book produced by the Moscow patriarchate, Europe Spiritual Homeland, is a collection of talks by Pope Benedict over the past decade—both before and after his election as Roman Pontiff—addressing the spiritual crisis in Europe. The book, published in Italian and Russian, carries an introduction by Archbishop Hilarion, the chief ecumenical officer of the Russian Orthodox Church.

Since the January election of Kirill to succeed Alexei II as Patriarch of Moscow, ecumenical contacts with the Vatican have increased dramatically. The new Russian Patriarch has strong personal ties with Pope Benedict; he met with the Pontiff on three different occasions while serving as the chief ecumenical official for the Moscow patriarchate. Patriarch Kirill has expressed a keen interest in cooperating with the Catholic Church, especially in the struggle against secularism in Europe: the topic of the new collection of papal speeches. On the same day’s a the book’s introduction, the director of religious affairs for the government of Belarus told reporters that his country might be an ideal location for a meeting between Pope Benedict and Patriarch Kirill. At a press conference in Minsk, Leonid Gulyako said that relations between the Orthodox and Catholic churches have always been warm in Belarus. The country’s President Alexander Lukashenko had issued an invitation for Pope Benedict to visit Belarus during an April meeting at the Vatican.

Although there has been no public discussion of any plan for a meeting between the Pope and the Russian Patriarch, officials of both the Vatican and the Moscow patriarchate have suggested in the past that such a meeting would probably take place neither in Rome nor in Moscow but at some “neutral” location.

The visit to Rome by President Medvedev is significant in itself, since the Russian leader has advanced the possibility that Russia might open a full embassy to the Holy See. (The Russian Federation currently has a special diplomatic representative at the Vatican.) Medvedev—who was baptized into the Orthodox Church as an adult, and whose wife Svetlana Medvedev is a known for her devotion to the Orthodox Church—could also serve as an intermediary in futhering talks between the Holy See and the Moscow patriarchate.

Reuters: HIGHLIGHTS 2-Russia's Putin: annual Q&A session

http://www.reuters.com/article/bondsNews/idUSPUTIN0920091203?sp=true

MOSCOW, Dec 3 (Reuters) - Following are edited highlights of Russian Prime Minister Vladimir Putin's comments in an annual question-and-answer session with Russian citizens on Thursday:

ON TERRORISM

"We have done a lot to break the spine of terrorism, but the threat has not been fully liquidated."

"The threat of terrorism remains very high."

The comments came in response to a question about a train bombing last week in which dozens of people died. Putin said it was difficult to prevent acts of terrorism but law enforcement agencies must act to pre-empt them.

ON FINANCIAL CRISIS

"The peak of the crisis has been overcome ... Exit from the crisis requires time, strength and no little funds."

"Some experts had said the decline in GDP will be around 10 percent. It is still significant, but better than we had thought -- somewhere around 8.5-8.7 percent. Industrial production has also shrunk, probably by around 13 percent (in 2009)."

"The economy has grown by an average of 0.5 percent per month over the last five months. I'm counting on these positive trends in economic development becoming more significant in the middle of next year."

ON BIRTH RATES

"Birth rates are growing at a record pace -- it will be over 3 percent -- and death rates are also falling ... This has an economic impact too, because it supports demand. By the way, demand is also recovering."

ON PIKALYOVO AND OTHER ONE-INDUSTRY TOWNS

"The situation in one-industry towns, including Pikalyovo, is under control."

"In Pikalyovo, it's necessary to secure a long-term contract for the entire year of 2010. Such an agreement between all the parties concerned will be concluded in the very near future." ((Moscow Newsroom, + 7 495 775 1242, moscow.newsroom@reuters.com))

BBC: Putin urges train bomb response

http://news.bbc.co.uk/2/hi/europe/8392465.stm

Russian PM Vladimir Putin has called for tough measures against those behind the bombing of a Moscow-St Petersburg train in which 26 people died.

He said the attack showed the threat to Russia from terrorism remained high.

He was speaking during a TV phone-in, in which he will answer some of half-a-million questions submitted by viewers.

A North Caucasus Islamist group has claimed responsibility for Friday's attack on the Nevsky Express, some 400km (250 miles) north-west of Moscow.

"It is necessary to act in a very tough way against criminals who carry out these kinds of terrorist attacks," Mr Putin said.

Itar-Tass: Eight cities to speak directly with Putin

http://www.itar-tass.com/eng/level2.html?NewsID=14597719

03.12.2009, 04.09

MOSCOW, December 3 (Itar-Tass) - Eight cities will be directly linked with Prime Minister Vladimir Putin during his conversation with Russian citizens. Although, according to the tradition, the conversation between Putin and people is being prepared in secret, some particulars of the coming special programme “Conversation with Vladimir Putin. Continued” have become known.

“The direct line” conversation with Putin will be made for the eighth time. The premier is expected to speak with residents of Pikalyovo City which became known all over the country six months ago. At the time, workers of three factories sealed off a federal highway three times, and Putin had to come there to thrash out things.

Following this event, the word “Pikalyovo” rooted down in folklore: video clips were shot about the city, songs and verses were written, while phrases, addressed by angered Putin to owners of factories, were repeated by people all over the country. For instance: “Why did you start scurrying to and fro like cockroaches just before my arrival?”

According to Itar-Tass information, Putin plans to speak with workers of the alumina factory so as to check up how his instructions have been fulfilled, and what the situation is now in the city from the viewpoint of ordinary people.

Togliatti is another city with whose citizens the premier intends to speak. The fate of the AVTOVAZ factory, hence their own destiny, is evidently a headache for residents. In general, the topic of engineering will be evidently one of the main during the coming conversation between Putin and people. According to a source, this is why the on-line TV conversation will link Moscow and Komsomolsk-on-Amur in the Russian Far East.

Its citizens are now lively discussing a possibility of opening a new car factory to assemble Japanese Nissan cars with participation of the Renault Company (one of stockholders of AVTOVAZ). Citizens want to ask the cabinet head how trustworthy these rumours are.

Naberezhnye Chelny in the Tatarstan Republic is also interested in the topic of engineering. Workers of the KAMAZ factory, located in the city, are sure to put questions directly to Putin. The premier promised to send them a special TV camera when he visited recently the enterprise.

According to Itar-Tass, mobile TV studios will be also set up in Sayanogorsk, situated close to the Sayano-Shushenskaya hydropower station. The premier and residents will speak about restoring the station and payments to specialists and their families who suffered during the disaster at the power plant.

RIA: Putin set for televised Q&A session

http://en.rian.ru/russia/20091203/157078533.html

10:2303/12/2009

MOSCOW, December 3 (RIA Novosti) - Russian Prime Minister Vladimir Putin will tackle on Thursday questions from the nation during his annual question-and-answer session, the premier's spokesman said.

As of 09:00 a.m. on Thursday [06:00 GMT], "a huge volume" of some 1.5 million questions and messages had been addressed to the premier, most of them centering on the fight against terrorism in the wake of the recent train attack, social and economic issues, the need for police reform, and other issues, Dmitry Peskov said.

Some of the questions have been posted at www.moskva-putinu.ru, and more can still be submitted.

Peskov said the phone-in, called A Conversation with Vladimir Putin. The Sequel, could last an hour and a half, but warned that everything "will depend on its intensity." It will be aired live at noon Moscow time [09:00 GMT].

Last year saw a record for Putin, who answered 80 questions in three hours and eight minutes, three minutes over the longest of the six televised question-and-answer sessions he had held as head of state.

Today's session is also expected to include a video linkup to Togliatti, where Russia's largest ailing carmaker, AvtoVAZ is based, and the northwestern town of Pikalyovo, where cement production was resumed in the summer upon Putin's instructions, Peskov said.

Some view today's event as Putin's chance to improve his popularity ratings, which have been falling in the past few weeks.

Russia Today: PM on the line – live Q&A with Vladimir Putin

http://rt.com/Top_News/2009-12-03/putin-live-call-session.html/print

03 December, 2009, 09:41

Vladimir Putin will hold his annual televised live call-in show with Russian citizens Thursday – the second as prime minister. During the Q&A session he will answer questions relating to the government’s domestic policy.

The show starts at noon Moscow time (0900 GMT) and is scheduled to last for an hour-and-a-half, but will most likely significantly exceed this time limit.

Watch the live transmission on RT

Last year, the session’s duration was 3 hours and 8 minutes, during which Prime Minister Putin answered 72 questions.

Some of them (more than 37,000 letters) have already been processed through a special website, www.moskva-putinu.ru. All in all, by 1pm on Wednesday, the prime minister had received around 700,000 questions.

Putin will also respond to questions from guests in the studio, from citizens in several Russian cities and towns via televised live transmissions, and on the phone. It will be possible to send text messages to the call-center as well.

The call-in session will be broadcast by several major Russian TV channels and radio stations.

The main topics Russians are concerned about are corruption, and increasing prices on anti-flu medicine and petrol.

The terrorist attack on the “Nevsky Express” train last week is also high on the agenda. If those who suffered in the incident ask about social guarantees and compensation, others are interested in the overall state of security in the country.

Reuters: Russia recession likely to dominate Putin phone-in

http://www.reuters.com/article/worldNews/idUSTRE5B167620091202

Wed Dec 2, 2009 6:35pm EST

By Gleb Bryanski

MOSCOW (Reuters) - Vladimir Putin, Russia's prime minister and most powerful politician, will field dozens of questions on Thursday from the Russian people at an annual phone-in likely to be dominated by the country's sickly economy.

The televised phone-in, which involves video links to hotspots such as the crisis-hit city which makes Lada cars, will be Putin's eighth and has become something of a national institution.

Starting at 0900 GMT, it offers the premier -- who most Russians believe takes all key decisions -- blanket exposure on state-controlled media and a chance to bolster his still-high popularity ratings, which have drooped slightly in recent weeks.

"A Conversation with Vladimir Putin. The Sequel" will be broadcast on state television and radio from a conference center next to the Kremlin. Last year's carefully choreographed phone-in lasted a marathon three hours and eight minutes.

This year Putin will be linked up to Togliatti, home to the struggling Lada car maker AvtoVAZ, and Pikalyovo, a town where he intervened in the summer to save a threatened cement factory and publicly humiliate its oligarch owner.

The government said Putin has already received over 700,000 questions by phone, text messages and through the Internet.

The premier, who served as president from 2000-8 before handing over his Kremlin post to hand-picked ally Dmitry Medvedev, spent all day Wednesday in his residence in a forested Moscow suburb preparing for the show.

"He is working with the background material, going through the questions," said Putin's spokesman Dmitry Peskov. He said Putin was not making any public appearances before the phone-in but would have some working meetings.

Peskov said all Putin's staff as well as some ministries were involved in preparations.

This year, the government posted some questions of its choice on the website www.moskva-putinu.ru but did not disclose the full list. The published questions focused on corruption, bureaucracy and government-provided social benefits.

One question went to the heart of the Russian political system, often unable to function without pressure from the top. "Why in our country can't bureaucrats deal with issues without help from the chairman of the government," it read.

Another question came from the town of Pikalyovo, home to the cement factory which Putin helped to restart.

"What is the probability of our factory working without stoppages in the future?" asked the questioner, who complained that her daughter had to drop education when the factory stopped paying her salary.

Last year Putin joked when a caller asked if he had called for Georgian President Mikheil Saakashvili to be "hung by his balls" for his role in Russia's war with Georgia.

He also invited a girl from a remote Siberian region who asked for a dress to celebrate New Year in Moscow.

Speaking as Russia's worst economic crisis in a decade unfolded, Putin promised to avoid mass layoffs, raise pensions, support factories and cut quotas for the use of foreign workers.

An increase in oil prices has helped to pull the Russian economy from the brink of collapse earlier this year.

But despite billions of dollars spent on stimulus policies, industrial growth has failed to materialize and Russia is lagging far behind its emerging market peers such as Brazil, India and China.

(Writing by Gleb Bryanski and Michael Stott; Editing by Charles Dick)

RIA: NATO meeting to address key issues on alliance's agenda

http://en.rian.ru/world/20091203/157076660.html

04:3203/12/2009

Foreign ministers from 28 NATO member countries will gather in Brussels on Thursday for a two-day meeting to discuss a wide range of issues on the alliance's agenda.

According to a NATO statement posted on Wednesday, the key topics of the discussions "will include the situation in Afghanistan, NATO's Open Door policy, relations with Russia, Ukraine and Georgia, missile defense, and NATO's new Strategic Concept."

The meeting will start with sessions of the NATO-Ukraine and the NATO-Georgia commissions to review both nations' progress in implementing their Annual National Programs and questions of regional security.

Ukraine and Georgia have long been pursuing NATO membership but their bids were turned down due to pressure from Germany and France at a 2008 NATO summit in Bucharest.

However, NATO has stated that the two countries will join at an unspecified date in the future.

Both countries have been included in the alliance's Partnership for Peace program, aimed at allowing "partner countries to build up an individual relationship with NATO, choosing their own priorities for cooperation."

At the working dinner on Thursday, the ministers will address NATO's Open Door policy in relation to Bosnia-Herzegovina's and Montenegro's desire to join NATO's Membership Action Plan (MAP).

The agenda on Friday includes a meeting in the framework of the NATO-Russia Council, which will be attended by Russian Foreign Minister Sergei Lavrov.

The upcoming session, the first official talks to be held since the August 2008 armed conflict between Russia and Georgia over South Ossetia, is aimed at drafting a "roadmap" for improving relations between Russia and the Western military alliance.

During an informal ministerial meeting in Greece in June, Russia and NATO agreed to renew cooperation on security issues, which was frozen after Russia and Georgia fought a five-day war in August over the former Georgian republic of South Ossetia, after which Russia recognized the independence of South Ossetia and Abkhazia, another former Georgian republic.

Relations have also been strained by Russia's resistance to Georgia and Ukraine's bids to join NATO.

Russian President Dmitry Medvedev said in October that "Russia is ready to harmonize relations with the United States and other Western partners, including constructive cooperation with NATO in solving common tasks."

Russia could play an important role in supporting NATO operations in Afghanistan, not only by providing transit of military cargo and personnel into the war-torn Central Asian country, but also by training personnel for the country's police forces and even delivering small arms and light weapons for Afghan police.

 

BRUSSELS, December 3 (RIA Novosti)

James Appathurai: NATO wants to discuss missile defense with Russia and plans to cooperate with Russia in tackling the problem of Afghanistan

http://www.interfax.com/17/533911/Interview.aspx

NATO plans to discuss missile defense problems with Russia at a NATO-Russia Council meeting on December 4, NATO Spokesman James Appathurai said in an interview with Interfax.

           NATO plans to discuss missile defense problems with Russia at a NATO-Russia Council meeting on December 4, NATO Spokesman James Appathurai said in an interview with Interfax.

            The participants in the meeting are likely to discuss how new U.S. plans on missile defense could be harmonized with NATO plans, he said.

            While Appathurai refrained from predicting a possible result of the discussion, he said he was sure that Washington's intention to employ NATO in its missile defense system would be supported in general, although no details, like its cost and other things, will be discussed.

            Speaking about NATO's relations with Russia, Appathurai noted that the 2008 crisis in Georgia showed vividly that, despite disagreements on interpreting the conflict, NATO and Russia understand that they should work together. When they have common analysis of threats and a working program, they would have a good basis for cooperation, he said.

            NATO and Russia obviously face common security problems, and they should do more than they are doing now to solve them, he said.

            Combating not only terrorism but also extremism in Afghanistan is NATO's job, but Russia has generously offered its support, which the alliance accepted gratefully, Appathurai said.

            With this support, NATO could do more in combating terrorism and drug trafficking in Afghanistan and be more successful in fighting terrorism in broader terms, he said.

Spokesman told also, that NATO planed to cooperate with Russia in tackling the problem of Afghanistan at several levels.

            Negotiations with a number of countries on the transit of non-lethal supplies intended for NATO forces deployed in Afghanistan are in their final stages today, Appathurai said.

            NATO will start using this transit route when all agreements are achieved, the alliance's spokesman said, adding that Russia has already allowed certain NATO member-countries to deliver their cargo to Afghanistan across its territory.

            Further negotiations will be held on methods of this transit, the possibility of expanding the range of NATO supplies intended for Afghanistan and other details, Appathurai said.

            NATO is also interested in working together with Russia to train personnel in charge of combating drug trafficking, the spokesman said.

            Specialists trained as part of the NATO-Russia Council's programs have confiscated a majority of drug hauls in Central Asian countries and Afghanistan, Appathurai said.

            Russia could also help upgrade Soviet-era military hardware used by NATO member-states and Afghanistan, the spokesman said, adding that such an initiative is being discussed today.

            Addressing NATO's strategy in Afghanistan, Appathurai said that the alliance's armed forces will focus on protecting the civilian population and will devote more energy and money to training and equipping Afghanistan's security forces.

            Tens of thousands of servicemen, primarily from the U.S., will join the NATO-led contingent in Afghanistan within the next few weeks, the alliance's spokesman said.

RIA: Russia, U.S. could sign new strategic arms deal by yearend — expert

http://en.rian.ru/russia/20091203/157075375.html

00:3903/12/2009

Russia and the United States will most likely sign a new strategic arms reduction treaty by the end of this year, a Russian political analyst has said.

Moscow and Washington are still negotiating a replacement for the Strategic Arms Reduction Treaty (START I), the basis for Russian-U.S. strategic nuclear disarmament, which expires on December 5.

"The [new] agreement will not be signed on Saturday, but there is a possibility that it could be signed as early as mid-December," Alexei Arbatov, director of the Center for International Security Studies at the Moscow State Institute of International Relations, said during a video conference between Moscow and Washington on Wednesday.

START I commits the parties to reducing their nuclear warheads to 6,000 and their delivery vehicles to 1,600 each. In 2002, a follow-up strategic arms reduction agreement was concluded in Moscow. The document, known as the Moscow Treaty, envisioned cuts to 1,700-2,200 warheads by December 2012.

An outline of the new pact was agreed during the Russian and U.S. presidents' bilateral summit in Moscow in July and includes cutting their countries' nuclear arsenals to 1,500-1,675 operational warheads and delivery vehicles to 500-1,000.

Russian and U.S. experts have held several rounds of talks on the new document since July, and have repeatedly expressed hope that the replacement for START I could be ready by December 5 deadline.

However, the U.S. Department of State said on Tuesday that the draft of the new treaty would most likely be ready by the end of December.

"It is not a tragedy that the new treaty is not signed by December 5. The tragedy, or a hard blow, to put it mildly, would be if the new treaty is not signed by May next year," Arbatov said.

He said an international conference will be held in May to discuss a new non-proliferation treaty and "all nuclear states are expecting the Russia-U.S. deal, which they have been promised."

"If the [new START] treaty is not signed by then, the conference will be a failure... and we might as well forget about a new non-proliferation regime, with all foreseeable consequences," Arbatov concluded.

 

MOSCOW, December 3 (RIA Novosti)

December 2, 2009

FOX News: NSC Adv Jones upbeat on new START deal

http://whitehouse.blogs.foxnews.com/2009/12/02/nsc-adv-jones-upbeat-on-new-start-deal/

Major Garrett Contributing Editor

Expressing far more optimism than the White House conveyed in mid-November, President Obama's National Security Adviser told Fox Wednesday a new nuclear arms control deal with Russia is within reach as both sides are "down to the last few paragraphs and sentences."

"All of the dialogue is encouraging, they're positive," Jones said of talks in Geneva with Russian negotiators on an arms control deal to replace the existing START agreement that expires Saturday. "I think the Russians want to do this. It's a very complex issue. We're down to the last few paragraphs and sentences. And if we can get it done by (December) 5th, fine, maybe it'll be one or two days later."

The START treaty, initiated in talks with Russia in 1991 and finalized in1994, limited the number of nuclear warheads in both countries and regulated the number and sophistication of air, sea and land-based launchers. Among the nettlesome issues for both sides, how to count operational versus obsolete warheads and how to verify compliance with warhead limits and delivery system capabilities.

Jones called the talks "a bit of race against the clock" to meet Saturday's deadline. He said the topic came up in Obama's call to Russian President Dmitri Medvedev on Monday and the two leaders "will speak again" to prod talks toward a deal.

"I think the attitude of both countries and all negotiators and both presidents who are driving the process is that we're headed towards having some success here. I just don't know if we'll hit (the expiration date) exactly right," Jones said.

Jones, the top US negotiator with Russia, added there appears to be less need for a so-called bridging agreement, a formal and separately negotiated deal to maintain current nuclear arms arrangements until a new treaty can be hammered out.

"We want to come to an agreement. At some point if there's something that prevents us from doing that then we'll have to talk about a bridging agreement," Jones told Fox in his first interview with the network during the Obama presidency. "We're in negotiations, it'll go on all day tomorrow, the next day, if we can get there, we'll be happy to announce it."

The goal is to reduce nuclear operational warheads on both sides to 1,500-1,675 and delivery vehicles - planes, missiles, land-based launchers - to 500-1,000. The START deal set warhead limits at 6,000 and delivery vehicles at 1,600 each.

Following the last face-to-face meeting between Obama and Medvedev Nov. 15 in Singapore, top White House officials said a new arms treaty might not be worked out until year's end.

"We talked about some sticky issues that still have to be resolved," Mike McFaul, the National Security Council's Russia expert. "And both Presidents committed to trying to get a new treaty in place by the end of the year. We're not at the endgame yet, we're not at the end of the year. We still have some fairly major things to finish."

The U.S. Senate and the Russian Duma must approve a new arms control treaty. That process will play out in 2010, meaning both sides will have to reach some kind of understanding -- formal or otherwise -- to maintain the arms control regime until a new deal is ratified.

"What I do know for sure is that we won't have a ratified treaty in place by December 5th," McFaul said on Nov. 15. "That has to go through our Senate, through their Duma. So that is for sure we do need a bridging agreement no matter what."

NY Times: Arms Treaty Likely to Expire Before New Pact Is Set

http://www.nytimes.com/2009/12/03/world/europe/03arms.html?_r=1

By PETER BAKER and CLIFFORD J. LEVY

Published: December 2, 2009

WASHINGTON — American and Russian negotiators are racing to solve the remaining obstacles to a new arms control treaty that would cut the world’s two largest nuclear arsenals by up to a third and replace a cold-war-era pact that expires Saturday.

The delegations are working marathon hours in Geneva to resolve differences over verification and to settle other details of an agreement that would reduce the number of deployed strategic warheads, missiles, bombers and submarines to their lowest levels in a half century. A mostly complete text has been written and translated, and there have been discussions about where to hold a signing ceremony.

But it appears unlikely that they will complete their work by the time the Strategic Arms Reduction Treaty of 1991, known as Start, expires, or that it can be ready for President Obama to sign when he visits Europe next week.

The idea of a ceremony next week had particular appeal because of the resonance of signing an arms control treaty on the same trip that Mr. Obama receives his Nobel Peace Prize, allowing him to position himself as a peacemaker even as he is escalating the war in Afghanistan.

Mr. Obama’s goal of eventually ridding the world of nuclear arms is more popular in Europe and elsewhere than is the eight-year-old war in Afghanistan.

As recently as this week, officials in Geneva were talking about holding a signing ceremony in Reykjavik, Iceland, the scene of the 1986 summit meeting where Ronald Reagan and Mikhail S. Gorbachev came close to an agreement to eliminate nuclear weapons altogether. Other sites under consideration were Geneva and Helsinki, Finland.

But a White House official, who was not authorized to speak for attribution about the talks, said that “it’s not going to happen” next week and that negotiators were now aiming for the end of the year. “We are working this hard, but it will only get done if it is a good agreement that advances our national interests,” the official said.

The two sides appear close on the question of limits. Mr. Obama and President Dmitri A. Medvedev had already narrowed the range for a cap on warheads to between 1,500 and 1,675 during a meeting in July, down from about 2,200 each side has now. They are likely to agree to lower the ceiling on delivery vehicles — intercontinental ballistic missiles, submarine-based missiles and strategic bombers — to below 800, from 1,600, according to an American official, although that would not result in significant reductions because the United States has about 800 and Russia about 620.

The most significant differences center on verification and monitoring. “There’s been a huge amount of progress just in the last week,” said the American official, who also was not authorized to discuss the negotiations with reporters. But “there’s going to have to be political heavy lifting in the next few days,” the official said.

Konstantin I. Kosachev, chairman of the international affairs committee in Russia’s Parliament, said final differences “require serious effort and compromise in the remaining time,” according to his office. Speaking from Geneva, he said the delegations were continuing “tense, intense and substantive work practically around the clock.”

Even if an agreement is reached in the coming days, the new treaty would need to be ratified by the Senate and the Russian Parliament, which could take months, so the two sides are working on a bridge agreement to continue inspections, verification and monitoring after Start expires.

One monitoring program, however, will not continue. The American observation station at Votkinsk, about 600 miles east of Moscow, will close by Saturday. Under Start, the station is staffed by Americans who monitor manufacturing of Topol-M ballistic missiles and other arms. The Kremlin has long chafed at the presence of an American outpost deep in its territory, since it closed its own monitoring station in the United States years ago.

Russia has taken a harder line on monitoring in part because its military and diplomatic establishment believes that a weakened Moscow in the waning days of the cold war made concessions that infringed upon its sovereignty.

“Russia is not interested in having the same scope of verification procedures that were in the earlier treaty,” said Anton V. Khlopkov, director of the Center for Energy and Security Studies in Moscow. “There is this conclusion that these measures were too much, and too extensive.”

But any concessions on verification could draw criticism in Washington, where Mr. Obama needs at least seven Republican votes in the Senate to ensure ratification. In a floor speech last month, Senator Jon Kyl of Arizona, the Republican whip, said that verification had not “gotten the attention it deserved all along.”

Baker Spring, an analyst at the Heritage Foundation, said the administration should limit only warheads, not delivery vehicles, because such a limit could also restrict missiles that could be used as conventional weapons. “The administration is risking getting itself into trouble,” he said.

But Daryl G. Kimball, executive director of the Arms Control Association, a research and advocacy group, said the treaty was an important step. “We’re 20 years after the cold war,” he said. “The only reason most of these weapons exist is to deter the use of them by the other.”

Peter Baker reported from Washington, and Clifford J. Levy from Moscow.

Xinhua: Russian climate expert praises China's emissions cut goal

http://www.china.org.cn/environment/Copenhagen/2009-12/03/content_19003440.htm

Xinhua, December 3, 2009

The Chinese government's decision to curb greenhouse gas emissions was correct and significant, a Russian climate expert told Xinhua.

Alexei Kokorin, head of Russia's climate change program of the World Wide Fund for Nature, spoke highly of China's announcement to reduce the carbon dioxide emissions per unit of gross domestic product by 40 to 45 percent by 2020 from the 2005 level.

Kokorin said the announcement highlighted China's responsible attitude towards climate change.

It was hard to predict the outcome on the upcoming Copenhagen climate change conference, said Kokorin, a Russian negotiator during the talks on the Kyoto Protocol.

The best result would be the participants reach consensus on controlling carbon emissions and achieve a legally binding agreement, he said.

Kokorin added that there were many impediments to such an international agreement, given the current situation.

The new deal should stipulate clearly developed countries' obligations to reduce greenhouse gas emissions in the period up to 2020, said the expert.

Developing countries might not be able to cut carbon emissions all by themselves and needed external financial assistance, Kokorin said, therefore more funds should be established to support them.

Azerbaijan leads CIS on GDP and industrial output

Thu 03 December 2009 | 08:35 GMT

News.az: Azerbaijan recorded the highest GDP of the CIS countries in January to October this year, 8.2%.

http://www.news.az/articles/3743

The figures were announced by the CIS Interstate Statistics Committee.

Uzbekistan had the next highest GDP in the reporting period, 8%, followed by Kyrgyzstan, 3.2% and Tajikistan, 2.9%.

In the first 10 months of the year, GDP in the CIS countries fell 9% overall in comparison with the same period last year. Armenia had the highest fall, around 17.5 percent, while GDP fell 15.9% in Ukraine and 9.6% in Russia.

Azerbaijan is the only CIS country to have achieved growth in industrial production. In January to October industrial output increased 7.4% compared with the same period in 2008.

During the reporting period, industrial output in Moldova fell 24.1%, Kyrgyzstan – 13.9%, Russia – for 13.3%, Armenia – 11.4%, Tajikistan – 8.6%, Belarus – 4.5% and Kazakhstan 0.2%.

Focus: Greek press: Greek-Russian and Greek-Turkish talks on Burgas-Alexandroupolis and shelf

http://www.focus-fen.net/index.php?id=n202254

3 December 2009 | 11:28 | FOCUS News Agency

Athens. Headlines in the Greek print editions today pay attention to meeting of the Prime Minister of Greece and Foreign Minister George Papandreou with the foreign ministers of Turkey Ahmet Davutoglu and Russia's Sergey Lavrov in the framework of the Ministerial Meeting of the Organization for Security and Cooperation in Europe in Athens. Davutoglu and Papandreou discussed anything else but disputable issues at the meeting in Athens, Greek newspaper Vima comments. Davutoglu and Papandreou agreed to intensify cooperation on bilateral, European, regional and international level, as the Turkish government has put the issue of Muslim minority in Thrace. Papandreou said after the meeting that Greece does not discuss issues with third parties relating to Greek citizens.Newspaper Ethnos reads that the Greek side has given a written reply to the letter of Turkish Prime Minister Recep Tayyip Erdogan of October 30, which offers a dialogue on all outstanding issues between Athens and Ankara. At a meeting yesterday Athens shown it is ready for dialogue at the level of exploratory contacts, but concerning only the shelf in the Aegean Sea because it holds its early position that the only bilateral dispute with Turkey is precisely for this shelf. Written response is expected through diplomatic channels in the coming days. Kathimerini writes about Greek counter-proposal of Ankara, which includes the activation of procedures for exploratory contacts about the shelf in the Aegean Sea.

RIA: Bulgarian environmental concerns cast doubt over Russian pipeline

http://www.businessneweurope.eu/dispatch_text10673

Ria NovostiDecember 3, 2009

Bulgaria's concerns over the environmental impact of Russia-backed plans for an oil pipeline through its territory may pose problems for the project, Russia's energy minister said.

The Burgas-Alexandroupolis pipeline project to pump oil from the Black Sea to the Aegean Sea is controlled by a consortium of Russian state-run companies.

"The Burgas-Alexandroupolis project faces problems as Bulgaria is insisting on improving the environmental efficiency of the project," Energy Minister Sergei Shmatko said during a session of the lower house of parliament on Wednesday.

He also said Bulgaria is also unhappy with the project's economic scheme, as Sofia wants to receive more than just dividends from the project.

The pipeline project was proposed by Russia, Greece and Bulgaria to pump Russian and Caspian oil from the Bulgarian port of Burgas to the Greek port of Alexandroupolis. The three countries signed an agreement to build the 280-km Trans-Balkan pipeline in 2007 following several years of talks.

A controlling stake of 51% in the project is held by the Burgas-Alexandroupolis Pipeline Consortium, owned by Russian pipeline operator Transneft and state-controlled oil producers Rosneft and Gazprom Neft.

Shmatko, however, said he is confident that there will be no problems in implementing another Black Sea oil gas pipeline project, in which Bulgaria is also involved.

The South Stream project is designed to annually pump 31 billion cubic meters of Central Asian and Russian gas to the Balkans and onto other European countries via the Black Sea, with the pipeline's capacity expected to be eventually increased to 63 billion cubic meters.

Petroleumworld.com: Russian oil pipeline hits snag in Bulgaria: minister

http://www.petroleumworld.com/story09120304.htm

MOSCOWPetroleumworld.com, Dec 03, 2009

A planned Russian-backed oil pipeline linking a Bulgarian Black Sea port with the Aegean faces "problems" with the government in Sofia, Russia's energy minister said on Wednesday.

"I think we will have problems because the Bulgarian side is insisting on us raising the ecological effectiveness of the project," Russian Energy Minister Sergei Shmatko told Russian MPs, quoted by news agencies.

Shmatko added that the Bulgarian leadership viewed the planned system for distributing dividends from the Burgas-Alexandroupolis pipeline as "not very advantageous for Bulgaria."

His comment came as Russian and Bulgarian energy officials prepare to meet in Sofia on December 11.

Bulgaria's pro-Western Prime Minister Boyko Borisov said following his election this summer that Sofia would review several major Russian-backed energy projects.

The oil pipeline, which would stretch 280 kilometres (174 miles) from the Bulgarian port of Burgas to the Greek port of Alexandroupolis, would carry Caspian oil to Western Europe bypassing busy shipping routes.

Russia, Greece and Bulgaria signed an agreement in 2007 on the pipeline project, which is 51-percent controlled by a Russian consortium made up of state-owned oil companies Transneft, Rosneft and Gazprom Neft.

Currently most of the Caspian oil destined for Europe and the United States is transported via the North Sea in tankers that pass through Turkey's Bosphorus and Dardanelles straits.

Story from AFPAFP 12/02/2009 13:44

The Moscow Times: Shmatko Faces Tough Talks in Sofia

http://www.themoscowtimes.com/business/article/shmatko-faces-tough-talks-in-sofia/390797.html

03 December 2009

By Anatoly Medetsky

Russia expects tough talks with Bulgaria next week over the proposed Burgas–Alexandroupolis oil pipeline, as Sofia is reviewing its energy deals with Moscow, Energy Minister Sergei Shmatko said Wednesday.

“I think we will have problems,” Shmatko said about the pipeline’s prospects, answering a question from a lawmaker in the State Duma.

Bulgaria is not only pressing for more environmental precautions, but also is critical of its potential profits from the project, he said. The government of recently elected Bulgarian Prime Minister Boyko Borisov believes that the current plan to simply gain dividends from the pipeline operation is not attractive enough, Shmatko said.

Shmatko, responding to a question from The Moscow Times, said he did not know the details of Bulgaria’s proposals to change the commercial terms of the deal but that he would discuss them at an upcoming meeting with Bulgarian officials.

Shmatko is heading to Sofia next week for talks on the $1 billion pipeline and Russia’s two other energy projects in the country: the construction of a nuclear power station and a stretch of the South Stream natural gas pipeline. Talks on the South Stream continue on the corporate level while details about the nuclear power plant require clarification, but these deals carry little risk of falling through, he said. Bulgaria’s Foreign Ministry didn’t respond to a request for comment Wednesday.

Boyko, after his election in summer, said he would revise the energy deals with Russia, casting doubt on their future. Prime Minister Vladimir Putin asked Boyko to make final decisions as soon as possible when the two met in September.

Martin Dimitrov, chairman of the Bulgarian parliamentary committee on the economy and energy, said an expected annual profit of $30 million from the oil pipeline would be ridiculously small compared with the risks for the environment and tourism, Business Week reported last week.

The Burgas-Alexandroupolis pipeline is a joint Russian, Greek and Bulgarian project to pump Russian and Caspian oil from the Bulgarian Black Sea port of Burgas to the Greek Aegean port of Alexandroupolis, which would create an alternative to tanker shipments through Turkey’s crowded Bosporus Straits.

Once completed, the pipeline will carry 35 million metric tons of oil a year, a volume that could eventually be increased to 50 million metric tons. Under an intergovernmental agreement signed in 2007 after seven years of talks, Russia holds 51 percent in the project company, while Greece and Bulgaria hold 24.5 percent each.

Shmatko was in the Duma to report on oil refining, saying Russia raised its production of refined oil products by 20 percent since 2004 but that their quality was very low. The poor quality brought down their price on foreign markets to that of Russian crude, he said.

Considering the difference in export duties, the federal budget could annually collect $15 billion more if oil companies exported crude instead of poorly refined products, he said.

The quality will start improving soon because oil companies are planning massive investment of at least 1.2 trillion rubles ($41 billion) to upgrade their refineries by 2015 in order to comply with new federal standards enacted last year, Shmatko said. The standards will begin applying in 2011, gradually raising the level of quality through 2015.

Russia Today: Nuclear power comes through with cash

http://rt.com/Business/2009-12-02/nuclear-power-comes-cash.html/print

02 December, 2009, 21:31

The world’s largest nuclear power firm says it's had no trouble placing a billion dollar plus bond issue, despite investor caution, saying that Russian state ownership gives it stability that many rivals lack.

When Russia privatized its crumbling power plants through 2008, new owners pledged to invest an eye-watering $820 billion. But that was before the credit crunch closed money markets, which has forced most energy firms to go back on their ambitious claims. Hugues de la Presle from Standard & Poors says their case for attracting investment is weaker.

“We see Russian utilities as still having weaker business profiles, and also much weaker financial profiles, especially in terms of liquidity.”

The only generator left out of the Big Sell-off was nuclear monopoly Atomenergoprom. It wants to raise its share of Russian electricity production from 17% now, to 25% in 2030. Anton Kovalevsky, Head of Investment at Atomenergoprom says state ownership guarantees its investment promises.

“We have unprecedented backing from the state. It currently provides 60% of our funds, but within 5 years we plan to be raising all money ourselves. Last week we issued a $1.7 billion bond, and will invest $68 billion in Russian electricity production by 2015.”

But the nuclear giant could find those plans derailed by the same state owners. Industry players are counting on being able to charge market rates for electricity from 2011, as the Russian government promised. But experts fear it will now keep price caps in place so citizens can recover from the crisis.

The Jamestown Foundation: Russia Seeks to Sustain its Energy Security

http://www.jamestown.org/single/?no_cache=1&tx_ttnews[tt_news]=35788&tx_ttnews[backPid]=7&cHash=3a3799094a

Publication: Eurasia Daily Monitor Volume: 6 Issue: 221

December 2, 2009 04:31 PM Age: 9 hrs

Category: Eurasia Daily Monitor, Energy, Russia, Home Page

By: Sergei Blagov

Moscow has reiterated pledges to improve Russian energy security by promising sizable investments to develop its hydrocarbon sector and power supply networks. However, the economic viability of such solutions appears to remain a matter of debate as Moscow’s ambitious plans require huge investments. Russian authorities have long pledged to replace obsolete and wasteful Soviet-era energy technologies and solutions by what officials describe as “energy-efficient” facilities. Moscow plans to spend 1.8 trillion rubles ($62.5 billion) from the federal and local budgets to finance energy-saving projects by 2020, Sergei Mikhailov, the head of the energy policy department in the energy ministry, told a conference in Moscow on November 10. However, these projects would allow saving up to 10 trillion rubles ($347 billion) in 2010-2020 by making the economy more energy-efficient, he said (Interfax, RIA-Novosti, November 10).

The governmental plans were backed by new legislative initiatives. Russian lawmakers are currently moving towards adopting new legislation on energy saving and energy efficiency, apparently designed to replace wasteful and outdated technologies. The new laws would introduce tax incentives to encourage energy saving projects, and set out measures of energy efficiency audits by the authorities. The bill also requires the phasing-out of incandescent bulbs in Russia between 2011 and 2014. The new legislation is expected to be introduced in early 2010.

Russian energy executives also appeared to be seeking international know-how to modernize and upgrade the country’s energy sector. In mid-October, Russia and Germany set up a joint energy agency (RUDEA). This agency, co-sponsored by the Russian energy ministry, was aimed at improving energy efficiency in the Russian economy relying on advanced Western technology (Nezavisimaya Gazeta, November 10).

In an apparent effort to prop-up the country’s energy security, Russian authorities have adopted a long-term blueprint entitled Russia’s energy strategy through 2030. Despite the adverse economic conditions, the blueprint included pledges of huge investments to develop the country’s energy sector. Although Russia’s energy strategy was drafted against the background of the global financial crisis, it stipulates 60 trillion rubles ($2.1 trillion) in investments in its energy sector through 2030, according to Energy Minister Sergei Shmatko. He said that the investments would mainly come from Russian energy companies (Interfax, ITAR-TASS, RIA-Novosti, October 26). Shmatko made these comments during the fourth International Energy Week in Moscow on October 26-30.

Russia’s energy strategy through 2030, adopted by the government in August 2009, envisages the continued increase of the country’s oil and gas production. According to the blueprint, by 2030 Russia is to pump 530-535 million tons of crude oil annually, or up by 8.6-9.7 percent from 2008, including exporting 329 million tons.

The country is also expected to extract 885-940 billion cubic meters (bcm) of gas per year by 2030, or up by 33-42 percent, including exports of 349-368 bcm or up by 45-53 percent. The blueprint appeared to be based on an assumption of an increasing output and a largely stable domestic demand, hence the bulk of the planned surplus was destined for exports.

The blueprint also envisages cutting power distribution grid losses from 12 percent this year down to 8 percent by 2030. The goal was intended to be achieved based on the use of advanced technologies and know-how. The government’s ambitious plans were evidently linked to expectations that the energy sector would become increasingly attractive to private investors. According to the blueprint, up to 90 percent of the planned 60 trillion rubles in investments in the Russian energy sector through 2030 will come from private sources. In 2022-2030, the government expects $321 billion to be invested in the oil sector, $299 billion in the gas sector and $529 billion in the electricity sector.

However, the blueprint apparently lacks a detailed explanation on how Russia’s aging energy infrastructure might attract huge inflows of fresh private investment. It also contained no specific stimuli for investors to underwrite the exorbitant expenses to develop the Russian energy sector dominated by the state-controlled giants, Gazprom, Rosneft and Transneft.

The latest energy strategy blueprint is yet another product of governmental planning based on expectations of increasing production and growing international demand. In May 2003, the Russian government moved to adopt an energy strategy through 2020, designed to position itself as a leader in the global energy market. The draft claims that by 2020 Russia will pump 450-520 million tons per year of crude oil and 700 bcm per year of gas.

Furthermore, expectations of the perpetual growth of the international oil and gas demand may also be detached from reality. In early November, Russian newswires cited estimates by the International Energy Agency (IEA) that global natural gas consumption could decline by 5 percent in 2015 and by 17 percent in 2030 (Interfax, November 5). If international energy-saving measures and other developments happen to entail lower hydrocarbon demand in the coming two decades, then Russian authorities may be forced to review the energy strategy through 2030.

ISRIA: Beginning of Meeting of Russian President Dmitry Medvedev on Economic Issues (2 December 2009)

http://www.isria.com/pages/3_December_2009_67.php

PRESIDENT OF RUSSIA DMITRY MEDVEDEV: Colleagues,

We are coming to the end of a very difficult year. I hope that next year the situation will be at least a little bit easier, including as a result of our joint efforts.

Let’s discuss the current economic situation and the immediate outlook.

Although the statistics can be given various interpretations, of course, they show that the main indicators have stopped their fall, including in the manufacturing and financial sectors. The anti-crisis measures we took have ensured support for particular sectors and, most importantly, have had a beneficial impact on the social and economic situation in the country as a whole. I think our work has been well organised in this respect. Our gross domestic product has registered positive growth since June this year.

We know that other countries are seeing similar trends. The crisis is not Russian but global after all, and so the situation is starting to improve everywhere. But at the same time (as we discussed at the international forums, including the G20 and other meetings) it is still too early to talk about the start of sustainable growth. All the analysts share this view.

I signed a number of important laws this week, including on the federal budget for 2010 and the planned period of 2011 and 2012. This law makes provisions for financing all of the necessary anti-crisis measures. Keeping in mind the complicated and responsible decisions we have taken, and for a number of obvious reasons, this law lays particular stress on pension provisions and other important social mandates.

Our task in the budget policy area is to facilitate post-crisis development, but this is not the only work we have before us. As I said in the Address [to the Federal Assembly], despite the fact that next year will be difficult too, we must start modernising all different sectors of our economy. The budget allocates considerable sums for infrastructure development and road construction – more than was allocated this year. The regional budgets will also contribute to spending in these areas of course, and we will make the necessary decisions on revenue source distribution. I recently signed a law in just this area – a law amending procedures for paying the tax on property that is part of the Unified Gas Supply System [the amendments work in favour of the regions in which such property is located].

There are several things that I want to discuss separately with you today. At the recent State Council Presidium meeting in Ulyanovsk I spoke about the idea of restoring the Road Fund in order to ensure stable financing for road construction. This idea has drawn some very mixed reactions: from full support to categorical opposition. I want us to come back to this idea and give it a serious examination, including the possibility of tying it to specific financing sources such as petrol excise duties and the transport tax.

Of course, we also need to look at what we can do to make administration and management more transparent in this sector, because the main issues are related precisely to these problems. I hope to hear proposals from the Government on this subject within the next two weeks.

Coming now to the budget indicators based on growth forecasts for key macroeconomic indicators, including GDP, the exchange rate, oil prices, and inflation of course, I would like to hear a brief report on just how realistic the forecast targets are, and also on the risks inevitably present, on the proposals for managing and mitigating these risks.

Ensuring macroeconomic stability remains an undisputed priority for budget and monetary policy. I think we have sufficient reserves for a flexible economic policy, but we need to tread very carefully in using the resources we have built up, given that we already had to draw on these reserves this year and it looks like we will have to do so next year too.

Another subject directly related to this meeting is that the formation of the customs union between Russia, Belarus and Kazakhstan calls for new approaches in economic activity. We have already signed the agreement on a common customs code for the three countries, and have taken decisions on common customs duties regulations and also on establishing a common non-tariff regulation system. This is an extremely important step for our country’s economy, as it is for our allies and partners – Belarus and Kazakhstan.

It is already clear that this will have a big impact on the means at our disposal for influencing the pace and extent of economic growth. It will reduce our possibilities for managing and regulating these processes by hand. This will be the case for customs duties, at any rate, from now on. We need to think therefore on how to make optimum use of this mechanism next year.

On the subject of customs duties, I think that their increase has not achieved the desired results in most areas. We had a number of reasons for making this decision, but it has not had any substantial effect and has raised numerous objections on issues that you all know. I therefore want to hear from you on the preliminary conclusions and the proposals for further work in this area, including adjustment of duties on some specific goods in the upcoming months. I have just signed an instruction for the Government on this subject.

This then is today’s agenda. The Chairman of the Russian Central Bank will now say a few words.

CHAIRMAN OF THE RUSSIAN CENTRAL BANK SERGEI IGNATYEV: Overall, I think the macroeconomic situation is stable and inflation is steadily coming down. Inflation was running at 0.3 percent for the first 23 days of November. Last year it was 0.6 percent for the same period. Accumulated inflation over the year as a whole comes to 8.4 percent, as compared to 12.3 percent last year. Overall, we expect inflation of around 9 percent, perhaps 9.2 percent this year – considerably less than last year, and substantially less than what we were expecting six months ago.

DMITRY MEDVEDEV: At the start of the year.

SERGEI IGNATYEV: The drop in inflation has made it possible to lower the Central Bank interest rates. At the end of November we lowered (for the ninth time) the refinancing rate by half a percent, bringing it down to 9 percent. In April it was 13 percent.

DMITRY MEDVEDEV: This refinancing rate is the lowest ever over recent years, isn't it?

SERGEI IGNATYEV: Yes, it is the lowest ever. Before the crisis began it was 10 percent, I think. Now we have lowered it to 9 percent.

Commercial banks are also lowering their interest rates on loans to the real sector, but unfortunately, this is not happening as fast as we are bringing our rates down. There are reasons for this. I imagine we will discuss these reasons later.

The main factors helping to bring down inflation are, first, moderate growth in the money supply, which has been growing by around 1.5-2 percent a month over recent months, and this is a very comfortable growth rate. Second, the situation on the currency market has stabilised. The ruble strengthened a little against the dollar-euro basket after February, but at the same time the exchange rate remains quite flexible. We are intervening less often than in past years, and on a smaller scale, and we are trying to smooth out only the sharpest fluctuations in the rouble’s exchange rate against other currencies.

As far as the balance of payments goes, it remains in a strong and stable situation. The current account has a positive balance of around -6 billion a month.

The capital flow situation is more complicated. We saw an outflow of capital in the third quarter, but in November, or in October to be precise, we registered an inflow of around billion. Our preliminary results show that this inflow continued in November and came to around billion.

Our currency reserves now come to around 5 billion. This is more than at the start of the year.

DMITRY MEDVEDEV: What is the total now?

SERGEI IGNATYEV: 5 billion. At the start of the year we had 7 billion. The figure dropped in February-March to around 4 billion after we completed our devaluation. Now the reserves are quite high.

I will end my opening remarks there.

DMITRY MEDVEDEV: Your opening remarks have turned out rather positive for everyone present I would say. Mr Kudrin, you have the floor.

DEPUTY PRIME MINISTER AND FINANCE MINISTER ALEXEI KUDRIN: Thank you, Mr President, for signing the law on the 2010 budget and the financial plan for 2011-2012.

I want to speak first of all about the end of year results. We have achieved revenue higher than what was forecast in February-March, when we made changes to the budget and adopted the anti-crisis programme. Our revenue came to 450 billion [rubles] more than the forecast target, 280 billion of which came from earnings on investment of money from the Reserve Fund and the National Welfare Fund from the previous year. The rest is the result of higher oil prices. Oil prices were the main factor enabling us to achieve higher revenue. We had planned for lower earnings from oil. This makes it possible to close the year on a stable note, carry out all planned spending commitments and begin carrying out next year’s spending commitments as planned and in stable fashion. This will require some more bylaws, some more government regulations to be precise, documents of a normative nature.

DMITRY MEDVEDEV: Bylaws, yes, don’t be shy about calling them that.

ALEXEI KUDRIN: Yes. We have 107 government resolutions that need to be issued by the end of January. Most of them – almost 97 of them – need to be issued in December. This is a big task for all of the ministries and agencies. The Finance Ministry is coordinating this work. We need to get these documents issued earlier than usual so that all ministries get their limits opened in January. I can say that the main limits, 90-92 percent, will be open now in December. In other words, all of the ministries will be able to start work as from January 1 with a large share of their limits already available so as to begin financing. In other words, there will be no obstacles for holding tenders and bids.

DMITRY MEDVEDEV: Excuse me please.

Mr Sobyanin, is it possible (I worked in the Government after all, and know how everything there is organized) to issue these regulations in a short period of time left in December?

DEPUTY PRIME MINISTER AND GOVERNMENT CHIEF OF STAFF SERGEI SOBYANIN: Yes, we will do everything possible to make sure that these regulations are issued swiftly as soon we receive them from the Finance Ministry and other relevant agencies and are not held up in the Government.

If the ministries have this work done on time, we will also manage, I am sure.

DMITRY MEDVEDEV: Good.

ALEXEI KUDRIN: We therefore hope that there will be no delays in the issue of regulations that could end up holding up meeting our spending commitments, and that in January we will have everything needed for financing ministries’ and agencies’ spending limits for the entire year. Rather than receiving funds on a monthly or quarterly basis, they will get full access to the year’s financing and will have it at their full disposal from January 1.

DMITRY MEDVEDEV: Good, thank you.

I could give the floor to Ms Nabiullina too, but I see that you have a presentation ready. Should we hear you behind closed doors, or will you say a few words now with the media present?

ECONOMIC DEVELOPMENT MINISTER ELVIRA NABIULLINA: Can I say a few opening words on the economic situation?

DMITRY MEDVEDEV: Yes, go ahead.

ELVIRA NABIULLINA: Our analysis shows that we have had monthly GDP growth over five straight months now. Industrial production still falls considerably short of last year’s figures, but it is still possible to say that the acute recession period is behind us now.

There are of course monthly fluctuations, and it is important to look not only at the figures but also at the factors driving growth. What is important in this respect is to what extent our growth is based on factors that signal modernization. So far, our growth is mainly export-driven, fuelled by export prices and demand for our goods.

DMITRY MEDVEDEV: This is the usual situation here.

ELVIRA NABIULLINA: But over recent months we have seen good results from the agriculture sector, especially in September and October. The construction sector is also doing better. It was the sector hardest hit by the crisis, but showed signs of livening up in October. Of course, talking about whether or not our growth is based on modernisation factors, modernisation requires investment, and so far we are not seeing sufficient signals of a renewal in investment demand. This is also connected to the policy measures that we need to adopt to encourage this investment demand. The Government has already drafted some of these measures, including on financial rehabilitation of a number of companies and sectors, and on possible increase of access to ‘long-term’ money. We certainly need to revive investment demand.

I want to note in this respect that the demand factor is changing with every passing month, as industrial output figures show. October was not a very good month in terms of industrial output. Taking the seasonal factor into account we saw a drop of 1 percent, mostly in the processing industry, automotive and machinery sectors. This shows that our economic policy, our growth policy, should focus on modernisation, investment, and making our industrial and processing sectors more competitive.

DMITRY MEDVEDEV: Thank you.

Kudrin still not favoring state monopoly over alcohol production (Part2)

http://www.interfax.com/3/534007/news.aspx

MOSCOW. Dec 3 (Interfax) - Russian Deputy Prime Minister and

Finance Minister Alexei Kudrin has reiterated his opposition to Russia

having a state monopoly over the production of alcohol.

Kudrin expressed in a recent letter his negative reaction to a

piece of proposed legislation that would restrict the production and

distribution of ethyl alcohol to organizations in which the state owns

over 50% of fixed capital starting January 1, 2011.

Five years ago, he said, Russia "had a government quota for

alcohol." "This was in essence a state monopoly," he said. Now "there

are different levels of control, but in the end this is not a state

monopoly in the direct sense, even in the propositions we are discussing

now," he said.

The Finance Ministry does not back the bill as it now stands,

Kudrin said, and he has "quite a lot of reservations" regarding the text

of the bill. "If these are dealt with, there will not be monopoly, and

the bill can then be supported," he said.

Experts on the country's alcohol market basically dismiss the idea

of a state alcohol monopoly, as proposed in the bill by Federation

Council Speaker Sergei Mironov, as not well founded.

Completely shelving the idea of introducing a state monopoly is

unnecessary, State Duma deputy Viktor Zvagelsky told Interfax. "But at

the present time, it is worthwhile making use of opportunities to

regulate the alcohol sector with the aid of current legislation," he

said.

Head of the Center for Federal and Regional Alcohol Market Research

Vadim Drobiz takes the view that the government is in no position to

organize and administer a state monopoly over such a huge segment of the

economy as the production and distribution of alcohol and associated

products. Such a monopoly would not resolve a single problem or issue,

he said, whether it be the 'alcoholization' of the Russian population,

the black market, or the insufficiency of tax receipts by the budget. "

"A state monopoly bears no relevance to any single one of these

problems," Drobiz said.

"The Russian Finance Ministry generally supports a state monopoly

over the production and distribution of ethyl alcohol as measures aimed

at a fundamental reduction of illegal turnover of both ethyl alcohol and

any other alcohol or alcohol-containing product and, correspondingly, at

increasing the excises the budget collects on such products," Deputy

Finance Minister Sergei Shatalov said in comments on the bill obtained

by Interfax.

But there could actually be negative effects on the sector and

budget, in addition, he cautioned. State monopoly would threaten to

exclude such alcohol producers as public organizations, necessitating

either their reorganization or liquidation.

Xinhua: Greece, Russia sign joint action plan on economic cooperation

http://news.xinhuanet.com/english/2009-12/03/content_12579265.htm

2009-12-03 08:28:33

 ATHENS, Dec. 2 (Xinhua) -- Greek Prime Minister George Papandreou and Russian Foreign Minister Sergei Lavrov signed on Wednesday a joint action plan on co