Johnson's Russia List #6013 10 January 2002 davidjohnson@erols.com A CDI Project www.cdi.org [Note from David Johnson: 1. Reuters: U.S. urges Russia to keep embattled TV6 on air. 2. AP: Prosecutors Detain Gazprom Execs. 3. Washington Post editorial: More Carnage in Chechnya. 4. Washington Times: Powell highlights challenges of 2001, goals for 2002. 5. Vremya MN: Andrei Kolesnikov, THE FUTURE ENDED YESTERDAY. Predicting Russia's future has become much more difficult. 6. Moscow Times: Mikhail Delyagin, What a Waste of a Year. 7. strana.ru: No Rocky Ruble as Russian Money Wins Analysts' Vote. Best in emerging markets, say economists. 8. Wolfram Schrettl: Re: 5618-Mau Interview. 9. NTV: Segodnya news summary. 10. Reuters: Russians shiver in winter's icy grip. 11. BBC Monitoring: Ill treatment of Caucasians in Russia rooted in behaviour - Armenian analyst. 12. PONARS: Dmitri Glinski-Vassiliev, Suffocation by Embrace. The Putin-Bush Alliance and the Cultural Threat to Western Democracy.] ******* #1 U.S. urges Russia to keep embattled TV6 on air By Elaine Monaghan WASHINGTON, Jan 9 (Reuters) - The United States on Wednesday urged Russia to respect media freedoms by ensuring that the country's only independent national television channel, TV6, wins a legal battle against closure. "In this case, there's a strong appearance of political pressure in the judicial process against the independent media," State Department spokesman Richard Boucher said, adding that the court order to shut it was based on a "flawed" law. "There have been unusually rapid developments in the TV6 liquidation case at high judicial levels where legal action normally takes months," Boucher told a news briefing. He said the case raised issues of media independence, fair and transparent application of business law and freedom of Russia's judiciary from political pressures. Secretary of State Colin Powell, during a visit to Russia in December, raised the issue in talks with the Russian leadership and demonstrated his support for TV6 by granting its General Director Yevgeny Kiselyov an interview, Boucher noted. "We continue to urge Russian officials to ensure that TV6 gets a full and fair hearing and ensure that press freedom and the rule of law can be best served by keeping TV6 on the air," he added. Kiselyov said on Tuesday he was confident TV6 would win the battle sparked by a Moscow lower court ruling in November that it should be shut down because of alleged statutory irregularities. He has dismissed the charges, saying they could be applied to almost any Russian company, and accused the Kremlin of trying to stifle alternatives to official propaganda. Boucher said the law was flawed in the first place and that it had lapsed on Jan. 1. He also pointed out recent rapid developments in the case, saying: "On Dec. 29, the Moscow District Federal Arbitration Court suspended the lower court's order to liquidate TV6. On Jan. 4, which effectively was the next business day, the Supreme Arbitration Court ordered the liquidation continued." TV6 enjoyed a surge in ratings with its recent broadcast of "Behind the Glass," the Russian version of the popular reality show "Big Brother." It has traditionally come fourth in television ratings behind three channels owned partly or wholly by the state -- ORT, RTR and NTV. TV6 became a refuge for veterans who quit the independent NTV network -- which Boucher said was also a victim of the law applied to TV6 -- when it was taken over by a branch of the state-backed natural gas monopoly Gazprom last April. ****** #2 Prosecutors Detain Gazprom Execs January 9, 2002 By VLADIMIR ISACHENKOV MOSCOW (AP) - Prosecutors tracking down funds allegedly siphoned from Russia's largest company, the Gazprom natural gas monopoly, detained its deputy chief and two top executives from a subsidiary in an apparent Kremlin drive to rein in feisty gas barons. The move, announced Wednesday, came weeks after President Vladimir Putin rebuked Gazprom over its murky relationship with affiliates and intermediaries. The arrests were seen as a sign of the government's determination to exert control over Gazprom, which alone accounts for about 8 percent of the Russian economy. Vyacheslav Sheremet, first deputy chief executive of Gazprom and chairman of its Sibur petrochemical subsidiary, was detained Tuesday along with Sibur's chief executive, Yakov Goldovsky, said Leonid Troshin, a spokesman for the prosecutor general's office. Troshin wouldn't name the third executive, but Russian reports identified him as Sibur's Vice President Yevgeny Koshchits. All three are under investigation for alleged abuse of authority, the prosecutor general's office said in a statement. No charges have been filed. Sibur refused to comment on the prosecutors' actions. Gazprom, which owns a majority stake at Sibur, has asked prosecutors to investigate allegations of $85 million in illegal sales through its affiliates, the company said in its own statement. Gazprom, the world's largest natural gas company, controls a third of the world's gas reserves - worth some $40 billion - and meets a quarter of the European Union's gas demand. However, its stock is worth only $8 billion. The company is 38 percent state-owned, but its old management has resisted the government's attempts to clear up its dealings with other companies, and investors have remained wary. Last May, Putin replaced Gazprom's former CEO Rem Vyakhirev with loyalist Alexei Miller in a bid to exert stronger state control over the gas empire, where the old management was accused of diverting cash to their families and friends. Vyakhirev later was given the largely ceremonial post of Gazprom chairman while Sheremet remained on Gazprom's executive board as first deputy CEO. Troshin wouldn't confirm or deny a report that Vyakhirev was questioned Tuesday on the Sibur case. A report released by Miller last June contained details on $2.6 billion in loans that Gazprom has guaranteed - some of them to shadowy firms owned by relatives of Vyakhirev and Sheremet. Russian media reported that Goldovsky had used Sibur to funnel assets out of Gazprom, leaving behind a debt of about $655 million. Putin raised the Sibur issue at a meeting with Gazprom leadership last November. ``You must pay close attention to the ownership issue,'' he warned. ``If you sit with your mouth open, you will lose not only Sibur, but other companies, too, before you have time to look around.'' Russian media reported that Gazprom wants to cut Sibur's executive board from 17 to nine members and put five of its own representatives on the board, including Bernhard Walter, former chairman of Germany's Dresdner Bank. In an interview published Wednesday in the daily Vremya Novostei, Walter said he had accepted Gazprom's proposal to become its representative on Sibur's board. The prosecutors' action came on the eve of a Sibur shareholder meeting that was set for Wednesday but did not take place. Gazprom said the meeting would be held after Sibur's charter is brought to conform with a new law that would make it easier for Gazprom, as owner of 51 percent of Sibur, to replace its chief executive. ******* #3 Washington Post January 9, 2002 Editorial More Carnage in Chechnya ANOTHER UPDATE is due on the much-celebrated shift by Russian President Vladimir Putin toward partnership with the West. Since his last meeting with President Bush two months ago, Russian authorities have tried to shut down the country's last independent television network and have convicted a critical journalist on trumped-up charges of espionage. Moscow has again refused to cooperate with a U.S. initiative to tighten United Nations sanctions on Iraq, and it has again rejected requests that it curtail supplies of weapons and nuclear materials to Iran. Now Mr. Putin's army has embarked on another bloody offensive in Chechnya, besieging the republic's third-largest city and killing scores of civilians with artillery barrages and helicopter assaults. According to Russian human rights groups, the offensive began Dec. 30, while most of the world was distracted by New Year's celebrations. Russian forces swept into the village of Tsotsin-Yurt and, according to the group Memorial, began shooting Chechen men indiscriminately. According to the official Russian account, more than 100 were killed over the course of several days; the independent Glasnost organization reported finding 200 corpses of civilians. "None of them was identified as a rebel," the group reported, "but relatives were not allowed to take the bodies for burial unless they signed a testimony that the killed person belonged to the Chechen rebels." The Russian forces then sealed off the town of Argun, beginning Jan. 3, and launched a "cleansing operation," in which hundreds are typically rounded up, beaten and in many cases killed; the survivors are released to their relatives in exchange for ransom payments. The Argun operation, which is still going on, has been particularly rough: According to official Russian reports, helicopter gunships were used to attack apartment houses where rebels were believed to be hiding. According to Mr. Putin, this brutal war, which by Russia's account has killed 11,000 Chechens since October 1999, is now an integral part of the war on terrorism; in fact, he recently suggested that Russia's campaign is more scrupulous than that of the United States in Afghanistan, as it did not "use aircraft or heavy bombers on settlements" -- an assertion quickly belied in Argun. Before his visit to the United States last fall, Mr. Putin appeared to agree with Mr. Bush that not all the Chechen rebels were terrorists, and he called for negotiations; but after a single low-level meeting the process broke down, largely because of the Kremlin's insistence that the rebels, who are seeking self-rule, surrender and disarm before negotiations begin. The Bush administration says it is following these developments, and it has criticized Mr. Putin's latest moves against the press. It clearly would like Mr. Putin to respect democratic freedoms and human rights. The question is whether such behavior will be a condition of a Russian-Western partnership or merely a fond wish. Mr. Bush hasn't been clear on that point; meanwhile, Mr. Putin acts as if he knows the answer. ****** #4 Excerpt Washington Times January 9, 2002 Powell highlights challenges of 2001, goals for 2002 Following are excerpts from an interview with Secretary of State Colin L. Powell at the State Department by reporters and editors of The Washington Times yesterday: Question: The first year of this administration is now over. What are the three most important things that you see as the best achievements of this administration, foreign policywise? Answer: I think we have structured a very strong relationship with Russia. I think that the meetings that President Bush has had with President [Vladimir] Putin and the dialogue that has taken place between me and my colleague, [Defense Secretary] Don Rumsfeld and his colleague, and at a variety of levels, have positioned us for a very positive continuing relationship with Russia. The way that Russia responded to the events of September 11th I think is reflective of that. The way in which we agreed to disagree on the [Anti-Ballistic Missile] Treaty after spending 11 months telling them where we were going, making clear to them that we were going there and nothing would deter us; is there a way we can do it together and is there a way that you can accept what we have to do? And at the end of the day, we agreed to disagree and the United States notified Russia that we were going to be withdrawing from the treaty. I notified Foreign Minister [Igor] Ivanov. He and I talked about it for two days. The president then called President Putin, and President Putin and I arranged the manner in which we would make all of these announcements. And guess what? The world did not end, an arms race did not break out, and there is no crisis in U.S.-Russia relations. I think that is reflective of the way in which we will be working together with Russia in the future. And then the last piece of evidence I would give you for my assertion is the way in which we have worked through NATO-Russia working at 20 — a lot of discussion, a lot of debate of what that was all about. But the fact of the matter is we came to an agreement with the Russians as to how we can pursue this dialogue at 20, and we are on a track to see if we can have it in place at the time of the Reykjavik [Iceland] ministerial [meeting]. I think that's a success. I think another success is the way we have ended the year with China. Remember also, we came through the spy crisis. Hard to believe that we had a spy crisis with Russia. These things come and go. You get 48 hours and that's it. It's over. It's gone. You have a big spy crisis and everybody was writing, "That's it. It's over. We can't do anything with the Russians.".... ******* #5 Vremya MN January 9, 2002 THE FUTURE ENDED YESTERDAY Predicting Russia's future has become much more difficult Author: Andrei Kolesnikov [from WPS Monitoring Agency, www.wps.ru/e_index.html] IN RECENT YEARS THE NUMBER OF UNCERTAINTIES AND RISKS IN GLOBAL DEVELOPMENT HAS RISEN SHARPLY. FORECASTS HAVE BEEN DEVALUED; THEY HAVE LOST CLARITY AND PRECISION. WE CAN EVEN PUT IT MORE HARSHLY - THEY HAVE LOST ALL SENSE. SEPTEMBER 11 PUT AN END TO THE HISTORY OF FUTUROLOGY. In 1994 Viktor Chernomyrdin made the most impressive forecast. At a Cabinet meeting, he consoled his colleagues thus "Those who survive will laugh." This exactly what happened - today's problems cannot be compared with those of the past. We can compare formal economic achievements and the psychological state of people in one word, it was more difficult to live at that time. Those who have survived can laugh at themselves. But 1994 differs from 2002 not only in this way. Six or seven years ago, it was possible to predict the development of Russian economy, the movement of world policies, describing details of the technological era with its technological progress. In recent years the number of uncertainties and risks in global development has risen sharply. Forecasts have been devalued; they have lost clarity and precision. We can even put it more harshly - they have lost all sense. September 11 put an end to the history of futurology. Controlling risks has always been one of the subtlest spheres of knowledge. But this knowledge has never been so deprived of value. At that, for objective reasons. Fund analysts are hardly trusted. Most powerful analytical units of the largest world investment banks should be trusted with caution. International financial organizations correct their forecasts every month. Well-known Russian economists manipulate with figures, assess economic growth, budget revenues and expenditure, inflation and, the most important, oil prices. Despite the fact that Russian economy looks almost as dynamic as that of China at the background of world recession, its predictability is far from being great. The background of its development, consisting of declining USA, Euro zone and Japan, is fraught with numerous, unpredictable risks. There are a lot of interior problems, which makes it very hard to predict inflation rates. It is even difficult to assess the so-called fundamentals of economy. By formal signs, the national economic system is healthy. But the figures themselves, if we do not look deep into their structure, and the processes, if we do not trace their development, do not make any sense. For example, budget revenues are still high, but only due to raw materials export. Does it prove that our economy is good? Of course, not. Over the past year incomes of population have considerably increased. But if we compare them with the level of 1997, they will make only 41% of default incomes of people. At the same time, slow growth does not mean anything either. It is now when oil thriving is over, and the devaluation effect has exhausted itself, that we can measure true growth of Russian economy. Growth, based not on the state of market, but on home demand, which drives economy in fact. But even these figures will not paint a true picture of our economic life. Growing economy does not develop all the time, because development is not the amount of produced goods, but society, which is improving on the basis of modern technologies. And it is not only widening of our own basis for the scientific and technological progress, but also development of democracy, institutions of civil society and a lot more important things, without which all economic indexes turn into dust, decoration and subjects for political speculations. The present period in the Russian history is much stabler than 1994, for example. However, stability has its back side - its soothing psychological effect turns to dust, as soon as we think of uncertainty. It suffices to turn to the experience of Argentina economic miracle, which resulted in pogroms, victims, collapse of the economy and replacement of presidents - three presidents during the last two weeks of the year. It suffices to remember of threats and challenges of terrorism. Stability corrupts, lulls vigilance, begets indifference, threatens democracy. We had ideological power for a long time. But it is to early to rejoice over de-ideologization of the state and society. A stable society respects neo-nazis, conformity becomes the dominant line of behavior, there is no strategy or progress in the economy, and public opinion disappears. The public hardly paid any attention to the shameful verdict in Pasko's case; it overlooked the abolition of the Presidential Pardons Commission. All this, like under Soviet rule, is of interest only to a small group of human rights defenders. Could we predict this a decade ago? Does it have anything to do with the economy? Eventually, it is easier to drive painful but important reforms in a sleeping society for example, the housing and utilities and pension reforms. But the matter is that a vague, indifferent society is another huge uncertainty in economy and policies. Such a society will not even think of its interests, if he country is forced to accept autocracy. At the same time, one day it may revolt for some reason, if the level of social tension reaches the critical point - the serenity of the people is deceptive... Without political democracy it is impossible to control economic risks. And the level of uncertainty is only increasing right now. (Translated by Daria Brunova) ******* #6 Moscow Times January 10, 2001 What a Waste of a Year By Mikhail Delyagin Mikhail Delyagin is director of the Institute for Problems of Globalization and economic adviser to former Prime Minister Yevgeny Primakov. He contributed this commment to The Moscow Times. Since 1994, Russia's reformers have been calling every year "one more lost year for reforms." 2001, however, is particularly deserving of this title. This was the year in which hopes were crushed and Russia's economic boom -- which provided GDP growth of 19.7 percent, industrial growth of 30.4 percent and a 33.5 percent increase in investments over the past three years -- ran out of steam. The slowdown started back in September. The cause, therefore, was not falling oil prices -- the most common excuse given by the government for its blunders -- but the unwillingness of the authorities to tackle key structural problems, such as the lack of property rights protection, the arbitrary and unchecked behavior of monopolies, the degradation of depressed regions and the corrosion of the state administrative apparatus. Bureaucrats, in exchange for the superficial support of the president, have been granted carte blanche to do whatever they please (according to a recent newspaper survey of businessmen, the price of bribes for influencing government decisions has doubled in the two years since Vladimir Putin became president). Something in the order of $20 billion per year flees the country as a result of the failure to resolve these problems. And the Russian economy increasingly resembles a person with ruptured arteries. At the Civic Debates Forum on Dec. 20, the ultra-liberal presidential economic adviser Andrei Illarionov effectively conceded the bankruptcy of the liberal economic course, noting that policies had "decayed with staggering rapidity -- faster than was the case during the first term of President Boris Yeltsin." He pointed out that in 2000 Russia received an additional $25 billion and in 2001 an additional $32 billion purely as a result of favorable conditions on the world markets and admitted that a continuation of the policies pursued by the government of Yevgeny Primakov in 2000 and 2001 would have resulted in GDP growth not of 8.3 percent and 4.9 percent, but of around 15 percent. Amazingly, when faced with the challenge of falling prices, the government did not even talk about the need for structural reforms and increasing the effectiveness of the bureaucracy, let alone try to implement such measures. For the most part, the rhetoric boiled down to assurances that Russia still had sufficient funds to see it through to the end of 2002, even if action was not taken. This would seem to be an incredibly short-sighted approach, but maybe the Russian government has plans to move the country at the end of the year. Official claims that GDP growth in 2001 was between 5.5 percent and 5.8 percent and will be 4.3 percent in 2002 are quite absurd. Between January and September growth was 5 percent and then it ceased; thus for the whole of 2001, GDP growth will be below 5 percent. The estimate of 4.3 percent growth for 2002 is based on an oil price of $23 per barrel for Urals crude. The actual level is unlikely to exceed $20 and thus GDP growth should not exceed 3.5 percent. If one factors in structural problems, it should be no more than 3 percent. In the two years of Putin's reign, economic growth has slowed from 8.3 percent in 2000 to what will likely be less than 3 percent in 2002. Industrial growth has fallen from 11.9 percent in 2000 to 5 percent in 2001 and will be no more than 3.5 percent in 2002. Growth of investments has fallen from 17.7 percent in 2000 to 8 percent in 2001 and will likely fall to below 5 percent in 2002. Only the drop in inflation has remained insignificant, from 20.8 percent in 2000 to 18.7 percent in 2001 and will probably remain above 15 percent in 2002. Price growth of manufactured goods has increased from 12 percent in 2001 to 16 percent in 2002, as a result of monopolies acting with impunity. The main factors affecting economic development in 2002 are the unresolved structural problems mentioned above, in particular burgeoning corruption. Falling world commodity prices and the erosion of reserves built up from 1999 to 2001 will further exacerbate the situation. 2002 will not be a crisis year, but a "pre-crisis" year with expectations being set accordingly. The money supply shrunk by 0.1 percent in November for almost the first time since August 1998. Between January and November 2001, the money supply grew by only 25.8 percent, while over the same period of 2000 it grew by 42.1 percent, and of 1999 by 39.4 percent. This is in keeping with the government's course, determined as it is to control inflation purely by fiscal tightening. This is useless, as inflation is caused not by excess money supply but by the unchecked abuses of monopolies. This is corroborated by the fact that inflation has been accelerating despite further belt-tightening measures. Inflation grew from 0.6 percent in September to 1.1 percent in October, and 1.7 percent to 1.9 percent in December. Further fiscal tightening in these conditions will only undermine the banking system, having a braking effect on the economy and provoke a new non-payments crisis. Falling exports and growth of imports are not so much brought about by falling oil prices as by domestic factors and above all by maintaining a fairly stable exchange rate in conditions of inflation. Growth of the real ruble exchange rate by 22.2 percent in 2000-2001 has boosted imports while undermining exports and the whole of the manufacturing sector. The government can try to halt the growth of the real ruble exchange rate not by containing inflation (which requires structural reforms and primarily a much more active anti-monopoly policy) but by devaluing the ruble in line with inflation. This is a palliative measure that will do severe damage to the key potential source of modernization -- domestic demand -- and will widen the gap between export-oriented sectors and the rest of the economy. Devaluing the ruble in line with inflation will also undermine efforts to de-dollarize the economy and lead to faster depletion of Central Bank reserves. Modernization in Russia can only be achieved if structural problems are resolved. However, while the government is controlled by the oligarchy --which it still is -- these structural problems will not be addressed as it is not in the interests of big business. Thus Russia's recovery is impossible without reform of the existing political system. This means that the government will almost certainly be unable to avert devaluation with all the ensuing deleterious consequences and may not be able to cope with the political fallout. The creation of a military-police state in such circumstances is highly likely. This would put Russia on a similar trajectory to relatively successful Third World countries such as Chile, South Korea and India. In these countries the elite comprises approximately 5 percent of the population, the middle class between 10 percent and 25 percent, and more than 70 percent of the population lives in poverty. Under a military-police state, successful modernization is possible. However, in Russia such a regime would not work as the army and law enforcement agencies are among the most corrupt and ineffective structures in the country. Therefore, absolutism Russian-style would be neither enlightened, nor competent, and as a result short-lived. Such a regime would collapse within three or four years. This would clear the way for Russia to find a constructive economic alternative to ultra-liberalism, combining liberal values and national interests, and to undertake a new attempt at systemic modernization. ******* #7 strana.ru January 9, 2002 No Rocky Ruble as Russian Money Wins Analysts' Vote Best in emerging markets, say economists By Michael Stedman Russia's ruble has been rated the most secure against threats to currency stability in 100 emerging markets worldwide. The verdict is that of Britain's respected Economist Intelligence Unit (EIU) in its annual review of global winners and losers in various categories of "country risk." Experts reporting yesterday (Tuesday) measured Russia's performance to judge the likelihood of any sharp fluctuations against the U.S. dollar or Euro in the 12 months ahead. "Strong fiscal performance, the still large current-account surplus - estimated at over $33 billion for 2001 - and high international reserves account for the marked improvement in this category in 2001," the assessment said. "These cushions allowed the ruble to stay steady against the U.S. dollar and the Euro in nominal terms, providing the scope for substantial real appreciation of the currency." The authors believed Central Bank commitment to keeping the real exchange rate stable meant the risk of sharp downward correction in the ruble should stay low, assuming oil prices did not fall much below $18 a barrel for 2002 as a whole. An oil price slump could see the currency weaker and much more volatile, the assessors said. The Baltic former Soviet Union state Latvia was judged the clear outright winner for the categories of overall risk, economic policy risk and banking sector risk covered in this year's report. Its debt-service ratio of around eight per cent was among the lowest in the developing markets and good progress was being made towards joining the European Union's (EU) first wave of enlargement, expected in 2005, the announcement said. Exports were growing rapidly and "Latvia has successfully diversified its trade dependence away from Russia to the broader EU market," the report noted. EIU analysts were less enthusiastic about Russia in a recent assessment rating countries according to the cost of doing business locally. Its 19 of 31 score reflected the fact that Russia was a country of contrasts, the report said in December. "It ranks among the ten cheapest countries for three categories (labor, telecommunications and transport) and in the most expensive ten countries for three categories (corruption, where it ranks second to Indonesia, expatriate costs and corporate taxes.) Of four east European countries surveyed, Russia was the most expensive, the report said. "High tax levels and extremely high costs of complying with the Russian tax regime, inconsistent government regulation, the inability of some investors to obtain redress through the legal system, and crime and corruption all dissuade investors," the analysts reported. ******* #8 Date: Wed, 09 Jan 2002 From: "Wolfram Schrettl" Subject: Re: 5618-Mau Interview David, JRL 5618 contains the following material: > #8 > Rossiyskaya Gazeta > December 28, 2001 > MONEY TESTS > Interview with Vladimir Mau of the Working Center for Economic Reforms. > Author: Mikhail Antonov > [from WPS Monitoring Agency, www.wps.ru/e_index.html] (...) > Quesiton: Western experts assure that we will die if we do not > manage to get investments from abroad. Here is a typical quotation, > German economist Wolfgang Schrettl writes, "We should do away with the > myth that Russia is rich enough to overcome the crisis by itself. From > the economic point of view, it is not a hyper-state. Its human > potential is useless without foreign investments." Do you agree? > Mau: It would be wrong to place hopes only on foreign > investments. The most important thing is that Russia is open to > innovations, world processes of technology development. The present > situation in the world makes self-isolation disadvantageous. The > country should compete in markets, including stock markets. However, > we should not take this indisputable thesis as Russia's hopelessness > and its dependence on foreign investments. > (Translated by Daria Brunova) I would like your readers to know that I fully agree with Vladimir Mau rather than with the statement which the interviewer, Mr Antonov, has ascribed to me. I have asked that gentlemen to provide the source of the alleged quotation. Let me also add that my correct first name is Wolfram (not Wolfgang). Best regards, Wolfram Schrettl Head, International Economics DIW Berlin German Institute for Economic Research wschrettl@diw.de Tel.: +49-30-89789-340, Fax: -108 http://www.diw.de/english/abteilungen/wlt/index.html ******* #9 From NTV: The following is a summary transcript of the main evening news bulletin broadcast by NTV in Russia. The service is compiled by the NTV newsroom and offered free to all interested parties. For more information contact Nikolai Bodnaruk at ntv.news@mail.ru NTV 'Segodnya', 8th January 2002, Moscow 1900 Today Russia's Far East has been struck by a cyclone, the strongest in fifty years. The snowfall continued for more than 24 hours. As a result, the region is paralyzed. The Mayor of Vladivostok City helped dig autos out of snowdrifts. -------------------------------- Today the blizzard caused tragedy in the Island of Sakhalin. A huge block of snow fell from a roof burying three children aged 11, 12 and 13. They couldn't climb out from under the snow and were suffocated. The rescue team needed about one hour to recover the bodies. Due to the severe snowfall, life was fully paralyzed in the city of Yuzhno-Sakhalinsk, the island's administrative center. The lightning has made inoperable several city power substations. As a result, entire residential blocks have remained powerless. Due to transportation problems, many citizens of Yuzhno-Sakhalinsk were two to three hours late to their working places. Due to enormous queues, the bus stops have turned into grounds for squabbling-cum-fighting. According to weather forecasts, the extensive snowfall will cease only on January 10. ---------------------------------- In St. Petersburg, a struggle for six lives lasted over 24 hours. These men were captured on an ice-floe in the Gulf of Finland. All efforts have been futile to perform a helicopter rescue operation, standard in such cases. ---------------------- Yet another great Russian scientist has died, Alexander Prokhorov was one of the few Russian researchers to win the Nobel Prize. --------------------- Today one of the longest special operations was completed in Chechnya by the federal forces. For almost one week Argun, the third largest republic's city, was blocked, as the military were neutralizing a group of insurgents. All that time the city had been closed to the media. ----------------------- Today, as soon the holidays ended, the Prosecutor General office resumed its hectic activities. Today its officers raided the headquarters of Sibur, an oil, gas and chemical corporation. According to some data, the investigators performed a search, whereas others insist that it was a regular inspection. As a matter of fact, neither Sibur nor the Prosecutor General office are commenting on the situation. An emergency shareholders' meeting is to take place tomorrow, with the key issue on the agenda being election of Sibur's new board. ----------------------------- Today Krasnoyarsk businessman Vilor Struganov was charged with terrorism, involving preparation of to bombings that took place in Krasnoyarsk on December 21, 2001, on the eve of the Legislative Assembly election. The entrepreneur has been transferred from temporary confinement to the remand prison. Following the Prosecutor General instructions, the investigation has been switched from Krasnoyarsk to the Kemerovo regional prosecutor's office. The Kemerovo investigation group has already arrived in Krasnoyarsk to collect materials for the case and establish Struganov's guilt. As a result of the two explosions - one in his house and the other on the porch of a school used as a voting center - two men were killed and one seriously wounded. The survivor may appear as a witness against Struganov. ------------------------- Today the man known as the organizer of the fraud of the century left the Krasnaya Presnya transit prison. Set free was Andrew Kozlenok, the key figure in the Golden Ada case that involved embezzlement of almost 200 million dollars. --------------------------- Today well-known international organization Amnesty International and the World Newspaper Association appealed to the Russian government with a request to release journalist Gregory Pasko. The statements insist that Pasko's verdict of high treason is a violation of freedom of speech. The documents qualify the journalist as the prisoner of conscience and demand his immediate release. In the city of Nizhny Novgorod a picket was posted in support of Pasko, where several men holding placards gathered in front of the Federal Security Service building. Due to intensive freezing, the act lasted just two hours. They have organized the gathering of signatures in support of the appeal launched by Pasko's defense. By the end of next week the lists will be dispatched to the Military College of the Supreme Court, demanding a fair and objective decision. ----------------------------- Fleeing from US contingents, Taliban leader mullah Omar holds about one hundred million dollars. According to the Washington Post, last November banks of Kabul and Kandahar were visited by his several messengers carrying 70-kg empty flour bags. On the average, they withdrew five to six million dollars in each bank office. The newspaper says the amount is quite difficult to carry. With the account of the fact that under the air strikes Omar had to abandon his favorite Toyota jeeps and switch over to a donkey, his flight with the moneybags may turn quite burdensome, say the US paper. ------------------------------ Following the Americans, the French are building up their military presence in the region. Currently they are expanding the Ainin airfield in Tajikistan that may turn into the beachhead for peacekeepers in Afghanistan. The French are doing their best to keep a low profile and avoid TV cameras. ------------------------------- During this year Russia may join the World Trade Organization, WTO Director General Michael Moore said today. The greatest hindrance for Russia's entry is huge subsidizing of the farming sector. However, Mr. Moore was confident that the problem could be solved. According to the WTO Director, the matter is being handled by a group of ministers who have sufficient will and firepower. ------------------------------- Today the Moscow City authorities have responded to the story of the four-month-old Pavel Belenkov which was broadcast on our channel. Due to the ban imposed by Moscow doctors the parents of the boy in need of an urgent liver transplantation have to seek the operation money abroad. At the today's sitting of Moscow City Government chaired by Valery Shantsev, Alexander Rumyantsev, chief pediatrician of the City Health Committee, denied the existence of such a ban and virtually charged our channel with misinformation. For the record - the hospital doctors who presented the story faced pressure from the Moscow City Health Committee. We will follow up the events and report further developments. ------------------------------ Leo Zaikov died today at the age of 78. The former Moscow City boss was also a member of the Politburo and a former First Secretary of the Moscow CPSU organization. The politician had occupied many important positions in the Communist Party leadership and became a Central Committee member on the same day as Boris Yeltsin. It was he who replaced Yeltsin as the Moscow City boss in 1987 after the future Russian President had been disgraced. Zaikov's burial ceremony will be held in St. Petersburg on January 10. ****** #10 Russians shiver in winter's icy grip By Clara Ferreira-Marques MOSCOW, Jan 9 (Reuters) - The harshest winter in a quarter of a century has sent shivers across Russia, paralysing the country's far east with heavy blizzards and covering even the palm-lined resorts of the Black Sea with a rare white coating. The chill, severe even by the standards of a country known for its endless dark winter months, has seen temperatures slip to an icy -27 Celsius (-16.60 Farenheit) in Moscow in the first days of the new year, after what forecasters on Wednesday called an unusually sharp December. "Last December was abnormally cold. The average monthly temperature was five degrees (centigrade)lower than expected," a spokeswoman for the Moscow Meteorological Centre said. "During the whole month there was not a single warm break, that's why so much snow has accumulated -- twice as much as is the norm." Early on Thursday, traffic was disrupted at a number of Russian airports including Moscow's international Sheremetevo-2, while the city's Vnukovo airport was closed for several hours after heavy snowfalls overnight, Interfax news agency reported. The long-running cold snap has taken its toll on the capital's growing homeless population. Since the beginning of the winter, 300 people have frozen to death in Moscow, city authorities say, well above last winter's 205 total. "The increase in alcohol and drug (consumption) has also made the problem of the cold very much worse," said Gordon Lewis of the Salvation Army charity. "Many people do not even feel they are dying." Many homeless people fall through the post-Communist social security net, most of them children or the elderly. Without valid residence permits for the capital they cannot claim help from the city authorities. Moscow's hospitals and health centres have been inundated by sniffling, sneezing people with almost 29,000 seeking treatment for flu in the first six days of the year, Interfax reported. BIG CHILL In central Russia, 2002 began at -33 Celsius the lowest temperature for 24 years, Russian media said. On the Pacific coast, navy servicemen helped clear roads and dig out snowbound buses in the far eastern port of Vladivostok after the region suffered its heaviest snowfall in 50 years. Television showed residents digging cars out of snowdrifts, while others trudged to work through clouds of swirling flakes. Last year the region was crippled by energy cuts which saw many residents spend the winter in dark, ice-encrusted apartments as plunging thermometers laid bare the failings of ageing infrastructure. The crisis forced President Vladimir Putin to intervene personally. He sacked his energy minister, ordered management changes in the regional electricity monopoly and forced local governor Yevgeny Nazdratenko to resign. The island of Sakhalin, also on Russia's east coast, was cut off from mainland Russia on Tuesday by a storm. On Wednesday residents were still forced to get about on foot, Russian television pictures showed, as motorists were kept off the road by large drifts of snow. A second storm is expected later this week. ****** #11 BBC Monitoring Ill treatment of Caucasians in Russia rooted in behaviour - Armenian analyst Source: Azg, Yerevan, in Armenian 9 Jan 02 p4 Text of report by Armenian newspaper Azg on 9 January entitled "For an ordinary Russian an insolent black-haired man is a native of Caucasus" Rouben Ayrapetyan, a correspondent of the Azg daily in Russia's capital was visiting Yerevan on the occasion of New Year. By taking advantage of his visit, we asked him to deeply investigate the reasons behind the mounting cases of ill treatment of Armenians in Moscow and Russia. Rouben Ayrapetyan has lived in Moscow for 25 years and his view of the problem may be of interest to our readers. As our readers may know, during a recent incident at one of Moscow's markets, an Armenian national was violently killed during an attack on the market by a gang of Russian 'skin heads'. The gang targeted 'people with dark hair'- Caucasians. Ayrapetyan dismissed the prevalent viewpoint in Armenia that there are obvious anti-Caucasian manifestations everywhere in Moscow. Mr Ayrapetyan said that it is exaggerated to some extent and one does not meet people full of hatred and contempt on each step, but it is true that there is a general atmosphere of antipathy. The reasons for this can be political, economic, social or moral, but the main thing, in the opinion of Mr Hayrapetian, is the conduct of everyday life, contacts, and the difference of mentalities. Caucasians have a contemptuous and supercilious attitude towards locals, which naturally creates tension. To top this, many natives of the Caucasus are engaged in criminal activities. Answering our question whether Russians in Moscow treat Azerbaijanis, Armenians, Georgians, Dagestanis and Chechens similarly, Mr Ayrapetian said that Chechens are treated worst of all. As regards Armenians, he said that for years a large community of Armenian intellectuals existed in Moscow, which conditioned the positive opinion about Armenians. This community still exists, but together with it there has emerged layers of traders, workers and criminals which, to put it mildly, harm the image of our nation. For a common Russian an impudent black-haired man has one nationality - Caucasian. During the Soviet era there was the 'person of Jewish nationality' expression and now there is another one - 'person of Caucasian nationality'. The main contingent of 'unskilled' Caucasians in Moscow can be seen in markets, where Azeris dominate. In fact, they have taken over the markets and nearby territories, opened their barbecue spots and 'chaikhanas' (tea houses), as well as open-air fairs. Walking through them you feel like you are in Baku, and seeing Azeris' arrogant and self-satisfied faces, one feels really sick. And it goes without saying that Russians are not filled with warm feelings when they enter such places. In reply to our question that in Russia, the Caucasians do the 'menial' work that locals refuse to do, Mr Ayrapetyan said that Russians would agree with Caucasians' presence in Russia if they behaved like guests. But Caucasians act like masters and behave impudently everywhere. Accusing Russians of being drunkards, deprived of initiative and capability to work, they claim that they (the Caucasians) are hard workers and entrepreneurs and bring benefits to Russia. Mr Ayrapetyan says that Russian nationalism has not yet acquired extreme forms, but to exclude such a possibility, bearing in mind the recent attacks on Caucasians, would be incorrect. He referred to a leaflet, distributed by a Russian nationalist organization which said that 85 per cent of Russia's population are Russians, but they are currently the world's poorest nation deprived of any rights. According to the leaflet, it is because Russia is governed not by Russians but by Jews. People of Jewish nationality hold more than 80 per cent of posts in the Russian government, their goal being to rob Russia's capital and transfer the accumulated fortunes to foreign banks. Against the background of the Russian nation's destruction, the Jewish mafia promotes the inflow of Asians, Caucasians and even Africans. These Caucasian and Asian mobs have already occupied all the markets forcing Russians out of all profitable businesses. As a result of Russians' destruction, Jews, Asians and Caucasians will gain power in Russia and aim to divide the country between NATO, Caucasians, Chinese and others. Mr Ayrapetyan also said that the issue could have been solved in a civilized manner if the level of in Russia was not so high. If Russians accuse Caucasians that they 'make money from air', then at the same time they should not ignore the fact that Caucasians "feed" the local police, city authorities and criminals. But the authorities in Russia are dealing with this problem. The State Duma recently discussed the draft law on the 'legal status of foreign citizens in the Russian Federation' which envisages introduction of quotas for foreign citizens who can enter Russia. It is difficult to predict the results of legislative changes. At present the most horrible thing can occur would be if Caucasians respond to the provocation of radical Russians. Then the situation will become a real chaotic one. ****** #12 PONARS Center for Strategic and International Studies http://www.csis.org/ruseura/ponars/index.htm Suffocation by Embrace The Putin-Bush Alliance and the Cultural Threat to Western Democracy Dmitri Glinski-Vassiliev (dmitriglinski@yahoo.com) Institute of World Economy and International Relations December 2001 PONARS Policy Memo No. 226 Prepared for the PONARS Policy Conference Washington, DC January 25, 2002 In the wake of the heinous terror strikes in the United States, President Vladimir Putin firmly embraced the idea of a counterterrorist alliance led by the United States/NATO and Russia. This was by no means an abrupt shift for him: in less than two years of his rule, Putin had been consistently pursuing wide-ranging security cooperation with dominant Western powers, and the United States in particular. This policy builds on the similar course of Mikhail Gorbachev and most of Boris Yeltsin's presidency. Yet Putin has ventured in this direction far ahead of both of his predecessors, as well as of Russia's liberal and Western-friendly mainstream establishment in general-despite the lack of a reciprocal response on the part of Washington (with the exception of it closing its eyes to antidemocratic developments inside Russia and in the Chechen War-a reward of a dubious value). The balance sheet of this policy is not encouraging for Russia-at least from the point of view of common sense that guides most outside observers and what remains of Russia's domestic opinion. On the other hand, Putin's policies have produced an unprecedented stream of seemingly good news for the Bush administration and, indeed, U.S. security in these hard times. However, for analysts and experts there is a danger of being swamped by the feel-good attitudes of government bureaucracy. Meanwhile, the longer-term impact and unintended-at least for the United States-consequences of the newly discovered Moscow-Washington friendship for the West are far from as positive as they may seem. To shed some light on this darker scenario, asking what the driving force is behind Putin's breathtaking rapprochement with the United States and NATO is worthwhile: what is it that he expects to gain, or believes to have already gained, as a reward from the Bush administration? The most obvious of these rewards has already been mentioned: the post September 11 developments in the United States have marginalized all those critical of the Russian government's excesses in Chechnya and its domestic politics in general. Western human rights advocates cannot effectively criticize Russia because it has become such a crucial ally of the West in a Manichean battle against the consummate evil of terrorism, while Russian democrats-whose voices are barely heard anyway-cannot afford to question certain aspects of Putin's rapprochement with the West for fear of losing their credibility in the West as reformers - and thus becoming even more vulnerable to repression and muzzling at home. Both are now impatiently dismissed as perpetual grumblers. This means a huge political and propagandistic gain for Putin, amounting to international quasi-legitimation of his domestic policies. Or, as a pro-Kremlin observer put it, "Russia's active involvement in the antiterrorist coalition…[has] brought about a striking convergence of the interests of the civilized world…with the personal interests and ambitions of our president." Moreover, wartime restrictions on freedoms in the United States and their spillover to other western countries have allowed the pro-Kremlin media to recast Russia's domestic "dictatorship of the law" as a norm to which the United States itself is allegedly-and hopefully-converging. General Shamanov, the grim "hero" of the Chechen atrocities, magnified Putin's personal enthusiasm for this situation when he distracted himself from his present gubernatorial duties to note, "We have something to learn from the Americans" as regards the unity between the government and its people. As one of the spokesmen for this variant of the "convergence model," Moscow pundit Alexander Tsypko put it, "The fact that [the West] now needs to strike a balance between freedom and the need for…safety has prompted it to draw closer to our country…now at last the Americans will begin…to understand that the problems of human life cannot be reduced to…the rights of sexual minorities or the right to participate in presidential elections." Although Putin's domestic plans of total control over the political landscape had already been overfulfilled before September 11, his foreign policy still has enough room for trying to consolidate and perpetuate the international constellation of forces favorable to his vision of a U.S.-Russian security condominium. As discussed elsewhere (see PONARS Policy Memo No. 147), influential groups within the Russian establishment implicitly conceptualize the state they control as a commercial corporate entity selling "protection" and "conflict mediation," as its main specialty on domestic and foreign political "markets" to the most affluent or strategically important "consumers"-under the new circumstances, the United States and NATO are at the top of the list. Within this mindset, the consolidation of Putin's gains requires maintaining a steady level of western demand for these "services." This, in turn, implies extending ad infinitum the present instability and suspense of international confrontation. Hence the otherwise seemingly illogical diplomacy of subtly encouraging the hard-line and war-prone groups within Western governments (that are partially overlapping with those who have positioned themselves as the winners of the Cold War). The starkest evidence to date of such an encouragement was Putin's "impromptu" statement in Brussels that virtually absolved the countries of the antiterrorist coalition from responsibility for whatever civilian casualties may occur in the course of their operations. Later, he restated the same point differently, by saying that the desire to avoid civilian casualties actually caused some of the U.S. problems in the Afghan operation (a point that at another level has become a sort of informal wisdom among Russia's intelligence services, whose representatives so often mock the United States in private and informally in the Russian media for their "overvalue" of the cost of human life). This incitement to the bloodthirsty elements that exist in the West as everywhere else was particularly striking in comparison with Moscow's ostentatious lack of enthusiasm for U.S. secretary of state Colin Powell's coalition-building and diplomatic initiatives to defuse the confrontational atmospherics, such as his efforts to rely on the Afghan ex-king Mohammad Zahir Shah. Systematic analysis of Putin and his proxies' actions and statements reveals a pattern of encouragement for the more bellicose forces both in the West and among its rivals at the expense of forces of moderation and tolerance. Consider, for example, Putin's comments to Germany's Bild, in which he softly reproached Germany for being content with its "modest position in the world" rather than playing a more active military and security role globally, and spoke condescendingly of those "intellectuals" who keep reminding everyone about Hitler to justify restraint. On another occasion, Putin specially emphasized that the German armed forces' participation in a military action outside of the German territory will "cause no concern at all" on his part. In light of this not-so-subtle overture to Germany's nostalgic right wing, it is particularly telling that at home the Putin administration has been encouraging and promoting, among others, the Eurasia Movement led by Alexander Dugin. Inspired by old racial theories, the mystical radicalism of the European New Right, and the "clash of civilizations" theory, the leaders of this organization speak of Russia and Germany as innately authoritarian geopolitical allies and guardians of the Eurasian "heartland" against both the inferior nations of the south and the "oceanic powers" (i.e., the United States and Britain) that always try to seduce and corrupt the European continent with their democratic myth. The Kremlin's virtual silence in response to the recent massive violence in Moscow by skinheads who ferociously attacked members of the Afghan émigré community and also ended up killing citizens of India, Armenia, and Tajikistan was all the more troublesome. This flirtation with the domestic extreme right or, at best, a toleration of it, dovetails with Putin's encouragement of Western hardliners. This mindset and these practices increasingly look like the mirror image of the early Bolshevik ideological operations in the West: while Bolshevik emissaries worked to divide and subvert western societies by radicalizing the Left, Putin and his cohorts may be doing just the same-only this time by coopting and encouraging the right-wing flank of the Western political spectrum. This strategy has been effective; even the Italian prime minister Silvio Berlusconi, constrained as he is supposed to be by his official responsibilities, announced after an encounter with Putin that "Europe should rediscover its Christian roots" in connection with the war against terrorism. Here we come to the seemingly immaterial but nonetheless quite real political and cultural challenge to the very foundations of the international democratic community-a challenge that is directly linked to the disarming and unnatural friendliness on Putin's part. His interests and policy actions point toward influencing the fundamentals of the Western political order and value system. This may be done by fueling and indefinitely extending the state of conflict and thus spreading the culture of emergency-based on the sense of an ever-present threat that justifies a long-term abandonment of democratic and human rights standards (in accordance with the Russian saying, "There is nothing temporary that with the passage of time would not become permanent"). His ultimate vision of international security appears to be a global technocratic police state. Meanwhile, as Ekaterina Stepanova noted in a different context (PONARS Policy Memo No. 201), "The world cannot afford its leader, the United States, to become another Israel-a 'fortress state' whose…unilateral counterterrorist measures seem largely irrelevant to the underlying problems…" To take this comparison a step further, it is worth noting that the Israeli-Palestinian conflict served for many years as a playing ground of sorts for those forces, including Soviet agencies, that thrived on fueling confrontation and emergency culture to increase international demand for their mediation "services." While in those times Moscow representatives tended to encourage irreconcilable stands on the part of the Arabs, in the 1990s the situation changed in the other direction. Thus, political spokesmen of the large and powerful Russian diaspora in Israel-openly connected with the Moscow establishment-have systematically weighed in in favor of the hard-line and confrontational elements in Israeli politics, thus exacerbating the climate of a "besieged fortress." The Kremlin recently felt markedly more at ease with hard-line than with moderate Israeli governments. Although Russia certainly does not have anything remotely close to such a diaspora in the United States, Putin seems intent on playing a similar role in person, as the United States' most valuable-and most uncompromising-ally. Clearly, the "Israelization" of the United States, in the security sense that was outlined above, vis-à-vis the Islamic world (coupled as it is with the progressing "Saudization" of Russia) would usher in an era of global instability, in which human rights, democracy, and tolerance would most of the time be seen as an unwelcome distraction from the struggle of Western civilization for its survival. This endless pursuit of physical security would only mask the moral defeat of the Western world and the subversion of its basic values. There is a Russian proverbial image equivalent to that of the Trojan horse: "suffocation by embrace." It is high time for Western strategists to learn it as well as they did the other Russian proverb-"trust but verify." One wishes that the reading of Putin's policies implied by this saying were to prove overly pessimistic. After all, millions of Russians, although feeling oppressed by their present order, aspire to a genuine rapprochement with the West-not on the basis of a shared threat and emergency culture, but on the firmer foundation of common humanistic values, including democracy, rule of law, private initiative, pursuit of social and moral justice, and respect for different civilizations, religions, and cultures. Their aspirations are now hostage to Putin's successes and failures. And there is a strong likelihood that arrogant rebukes to his charm offensive-such as the U.S. withdrawal from the ABM Treaty and far-reaching NATO expansion-will further weaken and antagonize these strategic allies of the democratic world within Russian society. Yet, as between Scylla and Charybdis, no less of a peril stems from further rapprochement with Russia's present elite: namely, that the United States (together with some West European powers) may end up in the most dangerously "entangling" alliance in its history, in which Western values-as well as the goal of a genuine and inclusive Westernization of Russia-would be severely compromised. *******