Johnson's Russia List
#6338
4 July 2002
davidjohnson@erols.com
A CDI Project
www.cdi.org
[Contents:
1. AP: Houston Gets Russian Oil Shipment.
2. Vremya Novostei: Nikolai Gorelov, AMERICA, HERE'S A GIFT FROM SIBERIA!
YUKOS fighting for a niche in the American oil market.
3. pravda.ru: RUSSIA’S PRESENT TO AMERICA ON INDEPENDENCE DAY.
4. Reuters: NATO offers training, real-estate tips to Russia.
5. Nezavisimaya Gazeta: Andrei Savitsky, WHEN NEWS IS SCARCE, POLITICIANS
MAKE IT UP. Politicians say there is a deep crisis.
6. San Francisco Chronicle: Anna Badkhen, Russians doubt Chechens ready
to take on rebels. Putin wants troops out, but officers dubious.
7. The Guardian (UK): Nick Paton Walsh, Spoils of war. Seven years ago the
Russians were shelling these paintings. Now they're oohing and aahing over
them.
8. Yezhenedelny Zhurnal: Aleksandr Ryklin, DEFERRED PAYMENT. The war in
Chechnya is likely to continue for some time.
9. Financial Times (UK): Robert Cottrell, Meanwhile, on the business
pages...
10. Dow Jones/AP: Iraq Willing To Pay Off $8 Bln Russian Debt - Ambassador.
11. EWI Russian Regional Report: Alexei Trochev, RUSSIAN COURTS PUBLISH
DECISIONS ON THE WEB.
12. Don Chapman: RUSSIAN TRIP APRIL/MAY 2002.
13. Wall Street Journal: Guy Chazan, Russia Airline Signs Airbus Lease,
Snubbing Local Aviation Industry.
14. AP: Russia Wants U.S. Chicken Certified.]
*******
#1
Houston Gets Russian Oil Shipment
July 3, 2002
By KRISTEN HAYS
HOUSTON (AP) - The first shipment of Russian oil to the United States
arrived in Houston on Wednesday, and U.S. officials hailed the delivery as
a step toward reducing dependence on Middle East oil.
Mikhail Brudno, first vice president of the Russian oil company that made
the shipment, said it would be the first of five or six to the United
States this year.
The 200,000-metric-ton shipment arrived in the Port of Houston aboard the
supertanker Astro Lupus.
Brudno said the shipment from Yukos, Russia's No. 2 oil producer, had been
purchased by Exxon Mobil Corp. and another buyer, whom he declined to
identify.
Yukos announced in May that it would send its first tankers to the United
States this summer. That announcement followed a summit meeting in Moscow,
at which President George W. Bush and Russian President Vladimir Putin
signed an energy cooperation statement.
Michael Smith, assistant secretary of energy for fossil fuels, said at a
news conference Wednesday that Russia needs to increase its share of world
oil exports and the United States must diversify its sources of oil.
``I hope this will be the first of many shipments in the future,'' Smith said.
Bruce Misamore, chief financial officer for Yukos, said the company's
production jumped 17 percent last year, to 1.1 million barrels per day,
prompting it to find an additional market for its crude oil. He said output
was expected to grow 20 percent this year, to 1.4 million barrels per day.
But shipping to the United States is costly because of Yukos' lack of
infrastructure - primarily deep-water ports - and increased transportation
needs, Misamore said. The company would need to add infrastructure before
it can really dent the U.S. market, he said.
Yukos could put the Druzhba-Adria oil pipeline into operation, which would
allow Russian oil to be shipped from the Omisal port in Croatia. Otherwise,
Yukos would need a set price for oil that would cover transportation costs.
Misamore said officials haven't decided what they would do during
short-term price decreases.
``We're looking at the numbers,'' Misamore said. ``We're still looking at
the logistics. This is brand new.''
High world oil prices drove Russia's economic growth in 2000 and 2001 and
lifted Yukos and other Russian oil companies. Yukos announced several weeks
ago, however, that its net profit fell last year to $3.5 billion from $3.7
billion in 2000, as a late-2001 decline in crude prices offset higher
production and exports.
Lukoil, Russia's largest oil company, has announced no plans to ship oil to
the United States.
*******
#2
Vremya Novostei
July 4, 2002
AMERICA, HERE'S A GIFT FROM SIBERIA!
YUKOS fighting for a niche in the American oil market
Author: Nikolai Gorelov
[from WPS Monitoring Agency, www.wps.ru/e_index.html]
THE FIRST DEAL FOR DIRECT EXPORT OF RUSSIAN OIL TO THE UNITED STATES
IS ABOUT TO BE COMPLETED. YUKOS EXECUTIVES CLAIM THEY ARE OPENING UP
AN ENTIRELY NEW MARKET FOR RUSSIAN OIL, SINCE THE UNITED STATES IS THE
LARGEST OIL IMPORTER IN THE WORLD. THE COMPANY DESCRIBES THE NEW
MARKET AS HIGHLY PROMISING.
Russian oil exports to the United States
The first deal for direct export of Russian oil to the United
States is about to be completed. Yesterday the Greek tanker Astro
Lupus brought 240,000 tons to Galveston. The shipment was sent to the
United States by YUKOS and Exxon Mobil on June 12, Independence Day in
Russia. The oil will be unloaded on July 4, Independence Day in the
United States. YUKOS is analyzing the financial results of the deal
now, but a source close to its management claims that a second tanker
is already being loaded. It will depart for the United States in
August.
YUKOS is exultant. Its executives claim that they are opening up
an entirely new market for Russian oil, since the United States is the
largest oil importer in the world. The company describes the new
market as highly promising. YUKOS head Mikhail Khodorkovsky announced
not so long ago that oil deliveries to America would be profitable
even at the level of $19-21 a barrel even though he himself had
mentioned $25 a barrel before that. Brent August futures at the London
stock exchange cost $25.65 a barrel yesterday evening, and Russian
Urals is usually $1.50 or so cheaper.
At the same time, experts are somewhat cautious with regard to
future deliveries. Specialists consider that deliveries will be
profitable only when a great deal of factors coincide. Mikhail
Perfilov, an analyst with Petroleum Argus, says that YUKOS in the deal
opted not to insure the risk that the price difference between WTI and
Brent may be below the acceptable level. The difference grew during
transportation and the deal may be profitable after all. "It doesn't
mean, however, that it will always be like that," Perfilov warns. "It
is possible to make some profits from some elements, but ongoing oil
exports from Russia to America would not be profitable, since large
tankers cannot access former Soviet ports (YUKOS was forced to use
Greece as a way station; three smaller tankers brought the oil there
and pumped it into the Astro Lupus).
As far as YUKOS is concerned, it has emphasized its position. The
Druzhba-Adrija pipeline is opening soon. Sales will be easier if
Khodorkovsky succeeds in persuading American customers that his
company is a reliable supplier. This will be an important aspect to
consider this autumn, because OPEC may opt to raise production, and
oil shortages would be over.
*******
#3
pravda.ru
July 3, 2002
RUSSIA’S PRESENT TO AMERICA ON INDEPENDENCE DAY
Right on the eve of Independence Day, a rather unexpected event has
occured: Russian companies started direct oil supplies to the USA. Very few
people believed that it would happen indeed.
Beginning of the oil supplies is very important from both political and
economic points of view. First, Washington demonstrates its interest in a
close partnership with Russia not only fixed in documents, but in practice
first of all. Russia’s Astro Lupus oil tanker will be met by US Deputy
Energy Minister Michael Smith and US Congress members Nicolas Lampson and
Ken Bentsen. This fact demonstrates the importance of the deliveries.
It is no secret that the USA wants to reduce the dependence of the US
economy on oil import from Mideast countries. Russian oil is an alternative
in this case. As of now, it is difficult to say to what extent the oil
deliveries will be economically justified. The matter of the fact is that
the first tanker with Russian oil has covered a rather long way:
originally, the oil was loaded onto the tanker in the port of Novorossiisk,
then by the Black, Aegean, and Mediterranean seas, it was delivered to
Houston. On the other hand, the route from the Persian Gulf is also rather
long.
President of YUKOS, a Russian company that performs oil deliveries to the
USA, Mikhail Khodorkovsky announced recently the intention to make oil
supplies economically rational, one barrel of Russian oil is to cost $25 at
least. It is to be taken into consideration that Russian oil is of a lower
quality than the Mideast oil. And, consequently, its price on the world
markets is much lower than $25.
On the other hand, if the project continues, Mideast countries will have no
opportunity to threaten the USA with the cessation of oil supplies.
Therefore, Washington is getting more chances for therealization of its
Mideast policy, and the USA appreciates this fact very much.
The beginning of the oil supplies is also very important for Russia’s
economy as well. If they become regular, Moscow can look at OPEC from a
considerable distance. OPEC, as is known, is not remarkable for its unity
of opinions; the increase of quotas for oil sales has been discussed for
several months already.
And what is more, unlike the Middle East, Russia has no reason to blackmail
the USA with cessation of oil supplies, and no reasons are likely to appear
in the future.
On the whole, time will tell to what extent the project turns out to be
economically justified. This is just the first shipment of oil from Russia.
Vasily Bubnov
PRAVDA.Ru
Translated by Maria Gousseva
******
#4
INTERVIEW-NATO offers training, real-estate tips to Russia
July 3, 2002
By Jon Boyle
MOSCOW (Reuters) - Once enemies divided by the Iron Curtain, Russia and
NATO are now working together to prepare Russian military officers for
civilian life and to convert military bases into hotels, shopping malls and
airports.
Though still on a modest level the talks, which received a fresh boost from
the creation of a new NATO-Russia Council in May, are the latest sign of
the improving relationship between the erstwhile Cold War foes.
NATO's top economist Patrick Hardouin said in an interview Wednesday that
NATO was offering advice on military re-organization, as Russia slashes its
armed forces by 200,000 to 1 million by year's end.
"We have identified three main areas of discussion and cooperation --
starting with retraining personnel and converting military sites, bases. So
there have been very concrete elements." Macro-economic issues and
administration were the other areas selected, he added.
Projects could include redeveloping military bases into hotels, shopping
malls or civilian airports, schemes which Hardouin said had worked in other
large countries like Ukraine.
NATO has also offered to work with Russia on macro-economic issues such as
the place of defense within the national economy, and administration of the
armed forces, notably accounting, transparency and civilian control.
Relations between NATO and Russia have improved significantly since
President Vladimir Putin's arrival in the Kremlin two years ago, and were
transformed after the Sept. 11 attacks on the United States.
"Essentially, the new reality is that we are in many ways in the same boat
as the Russians, in terms of threats to our security," Hardouin said.
"So the successful transformation of the Russian armed forces is a common
interest, and the development of the Russian economy is important to
Western Europe and the United States."
MILITARY OVERHAUL
Hardouin, who heads NATO's economics directorate, was in Moscow for talks
with senior Russian officials, including Deputy Defense Minister Lyubov
Kudelina.
The first woman to hold such an influential post in a ministry
traditionally dominated by men in uniform, Kudelina was brought in by Putin
to throw light on the military's Byzantine finances, seen as key to
reforming Russia's chronically cash-strapped armed forces.
Unusually, NATO itself is providing the $190,000 annual funding for a
NATO-Russia Center for retraining officers leaving the armed forces.
The seven-strong office, run by a three-star general, Leonid Mayorov, has
the job of training 100 professionals to give advice to officers quitting
the armed forces on their legal rights, social entitlements and training
opportunities.
The trainers will work in the Perm, Novosibirsk, Yaroslavl, Krasnodar and
Moscow regions and will not be short of work.
Putin wants the military to be cut to 850,000 and to channel savings from
staff reductions and greater efficiency into higher wages, as well as a
gradual switch to a fully volunteer force and the scrapping of the hated
conscription system.
An elite paratroop division this week began the first tentative experiment
in increasing the number of volunteers, eventually to about 80 percent of
the unit. If successful, this could provide a model for the rest of the
armed forces.
*******
#5
Nezavisimaya Gazeta
July 4, 2002
WHEN NEWS IS SCARCE, POLITICIANS MAKE IT UP
Politicians say there is a deep crisis
Author: Andrei Savitsky
[from WPS Monitoring Agency, www.wps.ru/e_index.html]
PRESIDENT PUTIN OFFICIALLY CLOSED THE POLITICAL SEASON A WEEK AGO,
BUT THE ESTABLISHMENT DOESN'T THINK THE SEASON IS OVER. RUSSIA'S
POLICIAL AND ECONOMIC SITUATION CAN HARDLY BE TERMED STABLE, MUCH LESS
PROSPEROUS. MANY RECENT EVENTS POINT TO A LOOMING CRISIS.
The Russian political establishment is talking of a crisis
President Putin officially closed the political season a week
ago, but the establishment would not be fooled. It doesn't think the
season is over. Instead of leaving Russia for well-earned vacations at
warm seas, the political elite is holding its collective breath in
expectation of radical changes. Resignation of the government is
predicted once again.
History of post-perestroika Russia has already taught everyone
that the worst political and economic cataclysms usually occur in
summer. The more the official authorities try to convince everyone
within earshot that economic and political stabilization has finally
come, the more everyone expects a crisis.
The situation being what it is, every insignificant fact and
nuance is suspected of being meaningful and indicative.
This time the part of "fatal omens" was played by postponement of
the visit of president to Saransk and Prime Minister Mikhail
Kasianov's press conference in Paris that never took place (he is
there to try and persuade the International Exhibitions Bureau to
organize the EXPO'2010 in Moscow). Russian politicians were
particularly alerted by Kasianov's refusal to terminate the visit in
the wake of the TU-154 disaster and by the absence of a detailed
coverage of Kasianov's visit from TV screens.
According to the official theory, Vladimir Putin postponed his
visit to Saransk because of the mourning. In Saransk, he was supposed
to attend a conference on problems of the Trans-Volga federal region
and open the Third Small Olympic Games (postponed too). As for
Kasianov, he called off the news conference when it became clear that
the schedule of the trip was much too demanding. Mayor of Moscow Yuri
Luzhkov stood in for the prime minister. As for the coverage of the
visit, celebrations concerning Moscow as a candidate for hosting EXPO
2010 would not have look right, because of the disaster.
On the other hand, it will not do to accuse politicians of being
too panicky. There is every reason to expect something to happen, as
far as they are concerned. Russia's policial and economic situation
can hardly be termed stable, much less prosperous.
Public debates between the Kremlin and the Cabinet over what
level of economic growth we need ("ambitious" or "whatever we can
manage") have forced the regime to admit that the national economy is
in bad shape. The condition of the global economy makes it clear that
Russia cannot expect to be able to profit from exports much longer.
Or take the absurd situation with the Slavneft oil company. No
one knows who is running Slavneft, while two company presidents take
turns. The state, the major shareholder, did not say a single word all
through the scandal. Take the phenomenal sentence passed on Bykov
shortly before the gubernatorial election in the Krasnodar territory;
the resignation of prosecutor representing the state in Colonel Yuri
Budanov's trial; the trials in absentia of Kalugin and Litvinenko -
all this makes it absolutely plain that the court system is just an
agent of political influence. The condition of the Russian Armed
Forces is such that even Chief of the General Staff Anatoly Kvashnin
calls it critical.
All this indicates that the regime is apparently indulging in
self-hypnosis. It releases triumphant statements, but the crisis is
upon us and can no longer be denied. Methods of getting out of crises
are always painful in Russia, and heads usually roll.
Novgorod Governor Mikhail Prusak threw some additional fuel into
the fire by saying that "the Cabinet may be replaced soon" because
"what Gref and Kasianov have been doing bears little resemblance to
managing the economy."
According to Prusak, he got a telephone call from Boris Nemtsov
with the suggestion to meet and discuss a single candidate from the
right. The governor turned the proposal down. He considers that the
candidate should be chosen for abilities and competence, not for a
popularity rating. Nemtsov explains that he meant a candidate for
president, not prime minister.
Nemtsov: Several days ago Prusak and I discussed the idea of
single candidate for president from all right-wing forces. He said he
would give it some thought. Today he told me that he does not want to
be involved. Well, we'll get by without him. As for a Cabinet
dismissal, I did not discuss it with Prusak. Only two people in Russia
are talking about it nowadays: Prusak and Zyuganov. They should
probably participate in the primaries too.
******
#6
San Francisco Chronicle
July 4, 2002
Russians doubt Chechens ready to take on rebels
Putin wants troops out, but officers dubious
Anna Badkhen, Chronicle Staff Writer
The way Maj. Andrei Pererva sees it, no Chechen can be trusted -- not even
a police officer.
"They are all bandits," Pererva said under his breath as he eyed a heavily
armed Chechen officer in Grozny, the capital of the breakaway republic.
Pererva, a spokesman for Russian federal troops in Chechnya, firmly
believes that Chechens cannot handle the complex and crucial task of
crushing the bloody, two-phased Islamic insurgency that has cost thousands
of lives in this volatile region since 1994.
But that is exactly what Russian President Vladimir Putin pledged to do
last week when he said Chechens must take over control of their homeland
from the 80,000 federal troops who have been fighting since October 1999,
when the Kremlin launched its second brutal war here. By the end of the
year, Putin said, "only Chechens must be defending Chechnya."
Overwhelmed by mounting losses among Russian servicemen in Chechnya, Putin
for months has been trying to put an end to the increasingly unpopular
military campaign.
His hard-line vows to crush the insurrection helped him ascend to power in
2000. But having failed to end the fighting last fall, when he fruitlessly
called on the rebels to disarm, Putin is now seeking ways to cut his losses
and pull out of an area that has become Russia's internal Vietnam.
THOUSANDS OF SOLDIERS KILLED
In March, the Kremlin announced that more than 3,500 Russian soldiers had
been killed and nearly 9,000 injured in Chechnya since 1999. Human rights
groups such as the Soldiers' Mothers' Committee in Moscow say the losses
are three or four times as high.
The toll among the Chechen rebels and civilians is not known because the
federal government does not bother to keep a tally -- an astonishing symbol
of the psychological distance between the Kremlin and Chechnya.
Somewhere between 250,000 and 300,000 Chechens have fled to refugee camps
in the neighboring republics of Ingushetia and Dagestan and the country of
Georgia.
Moscow, which claims the Chechen rebels are linked to Osama bin Laden's al
Qaeda network, says it is fighting against international terrorists and
compares its war here to the U.S.-led campaign in Afghanistan. But success
is elusive. Most insurgent leaders remain at large, and Russia keeps losing
an average of one or two servicemen in daily clashes.
Federal troops respond to hit-and-run attacks with random document checks
and vicious door-to-door sweeps for suspected rebels, during which Russian
soldiers detain and sometimes kill dozens of innocent Chechens and local
residents, international human rights groups say.
The group known as Memorial says it has proof that 946 Chechen civilians
died at the hands of Russian troops in just three of the most populated
districts during a 14-month period that ended in November. The group lists
another 1,200 to 2,000 as missing.
The brutality breeds fear of Russian servicemen and a thirst for revenge,
and many Chechen civilians willingly take up arms to join the insurgents.
Ordinary Chechens, who have learned to lower their gaze and hide as soon as
they notice Russian men in uniforms, welcome the Kremlin's drive to
withdraw most of the federal troops.
"We know that Chechen policemen have at least some kindness in their hearts,
not like the Russians," said Taya Arsakhanova, on her way home to Grozny
from a refugee camp in Ingushetia.
"When the Russian troops do their sweeps, they take our men, and later we
find their bodies," Arsakhanova said.
CHAOTIC CONDITIONS
But a three-day tour of Grozny with Russian troops raised doubts that the
Chechen police and the republic's pro-Kremlin government were ready to take
charge.
The Chechen government led by Akhmet Kadyrov, handpicked by Putin in 2000
to replace President Aslan Maskhadov, who had sided with the rebels, has
done little to improve life in the war-shattered republic.
In Grozny, most buildings have long since been reduced to rubble, and
people live without electricity in bombed-out ruins. There is almost no
work, and nearly every night civilians blow themselves up on rebel mines
planted on well-traveled roads or get caught in cross fire between the
insurgents and the Russians.
"We don't trust Kadyrov," said Khamzat Visirkhanov, a Chechen refugee in
Ingushetia. "He has done nothing good for us."
Russian soldiers who had fought in Chechnya during the first phase of the
war, in 1994-96, have their own reason not to trust Kadyrov. During that
campaign, he was a rebel leader fighting against federal troops.
Today, Kadyrov's government works in a compound heavily guarded by Russian
police officers from elite counterterrorist units. Similar units guard the
entrance to the headquarters of Chechnya's nascent police force.
"I don't know why they don't have Chechen policemen guard their own
buildings," said a Russian officer who patrolled the courtyard of the
headquarters. "I guess they don't trust them."
POLICE FORCE WEAK
After eight years of violence, most Chechen police officers have become
refugees or died fighting, said Col. General Vladimir Moltenskoi, who
commands the federal troops here. The new police force in the republic has
only about 8, 500 men, operates in fewer than 100 of Chechnya's 400 towns
and villages and is too weak to take charge, he said.
"Those who have joined the police force don't have any training,"
Moltenskoi told a group of foreign journalists at a military base in
Khankala, outside Grozny, this week. "As a Russian proverb has it, we have
to trust them but verify. We can't just let any old person to take power
here."
Moltenskoi said that many Chechen police may have fought with the rebels
previously, and some may still have ties with the insurgents. Lt. Col. Musa
Gazimagomadov, who commands the Chechen special task police force, said he
had fired 168 of the 301 officers under his command in 2000 because he
suspected they were rebel collaborators.
Moltenskoi said he had evidence the rebels received their funding from
abroad, mostly from Jordan and Turkey. He also affirmed the Kremlin's long-
standing claim that Arab mercenaries linked to groups like al Qaeda are
fighting here side by side with Chechen rebels, and that many Chechens had
been training in al Qaeda and Taliban camps in Afghanistan and Pakistan.
"I know because my troops have killed a number of Arab fighters in
Chechnya, " Moltenskoi said.
Last month, Russian Defense Minister Sergei Ivanov said Russian troops had
seized rebel documents that included accounting ledgers in Chechnya that
showed incoming funds from Turkish, Qatari and Jordanian sources, and hit
lists with names of pro-Russian local administrators.
Moltenskoi estimates that there are only about 1,000 hard-core rebel
fighters, but he said their potency was far greater than their numbers
since they received crucial help from civilians who were recruited to mount
attacks on federal troops.
"Some young people join in because there is no work here," he said. "They
fight to make a living for their families."
Each participant of an assault receives about $18 for an attack that
results in the death of a Russian or Chechen police officer and between $50
and $150 for blowing up a Russian armored personnel carrier or a tank, he
said.
"They have to show on video how they killed a policeman, or blew up a car,
and then they get paid and spend the money to prepare the next assault,"
Gazimagomadov said. "They are universal soldiers, so to speak, ready to
kill dozens and even hundreds of people for money."
The rebels don't spare ethnic Chechens, either. In April, a convoy carrying
14 men from Gazimagomadov's police unit blew up on land mines planted by
rebels.
Gazimagomadov, whose office window in central Grozny is marked with four
bullet holes, said: "Anyone who says that federal troops should leave the
republic wants the Chechen people to die. If the troops withdraw, Arab
mercenaries will take their place."
*******
#7
The Guardian (UK)
4 July 2002
Spoils of war
Seven years ago the Russians were shelling these paintings. Now they're
oohing and aahing over them. Nick Paton Walsh reports
By Nick Paton Walsh
It is a stark and lonely image, glowering under thick glass. A gaping hole
lies where the subject's face should be, a few tattered suggestions of a
red tunic, flowing curls, maybe even a beard still on the canvas. It might
be Christ - or a doting portrait of an aristocrat.
The first painting that confronts visitors to a new art exhibition in
Moscow's Tretyakov Gallery stands out among the other renovated works.
Untitled, it still bears the scars of the town it was rescued from: Grozny,
the capital of Chechnya.
The exhibition, The Resurrection of the Grozny Museum, has just opened
courtesy of the Russian Ministry of Culture. In 1995, with Grozny the
battleground for Russian troops and Chechen rebels, the ministry rescued
nearly 600 works of art and antiquities from the Pyotr Zakharov Fine Arts
Museum. The museum had been used by the rebels as a machine-gun emplacement
to defend the nearby presidential palace and had been gutted by Russian
artillery and machine-gun fire. A team of Russian emergency workers,
sappers and helicopter pilots salvaged 100 paintings from the booby-trapped
building and airlifted them to the safety of Moscow, working frantically to
undo their own army's handiwork. The pictures lay untouched for years,
until towards the end of Yeltsin's reign a team of restorers were given
orders to bring them back to life.
"Twenty men worked on restoring the works for two years," says Nadezhda
Koshkina, deputy head of the painting restoration department. "It was very
hard work."
Some of the paintings on show left Chechnya in murky circumstances. Two
18th-century paintings of Count Nikolai Zubov and Countess Natalya Zubova
were placed at Sotheby's for auction last year, but withdrawn when
Sotheby's discovered they belonged to the Grozny museum. Others works in
the exhibition had various degrees of damage. While The View from Stolovaya
Mountain needed a bit of flattening-out and some new varnish, others needed
heavy treatment.
Franz Roubaud's Taking of Gunib Aul was one of the worst. After
disappearing from storage in another Chechen gallery in 1999, it was found
in 2000 by federal security services on the Chechen border in the hands of
thieves who were trying to smuggle it out of the country wrapped in a
carpet. The fold lines had damaged the canvas.
The picture, worth about £1 million and painted in 1886, tells the story of
the end of another war in the north Caucasus. In August 1859 the
24-year-old war between Russian troops and the fearsome mountain rebels led
by Imam Shamil came to an end. In a quiet grove near the besieged town of
Gunib, Shamil met the Russian commander-in-chief, Prince Alexander
Ivanovich Bariatinsky. The image is of a tired old man in tribal garb,
surrounded by Russian troops in immaculate white caps, laying down his arms
beneath the mountain peaks. Roubaud is said to have travelled to the area
several times to research his images of the conflict, and this is reflected
in the detail. Shamil is supposed to have greeted his long-term adversary
with the remark: "For 30 years I fought, but my people deserted me, and the
fighters took flight. I myself am tired; I am old, I am 63. I congratulate
you on the mastership over Dagestan and most sincerely wish you rule the
mountain people for their good."
It is unlikely that Colonel General Vladimir Moltenskoy, commander of
Russia's troops in Chechnya today, will hear such graceful submissions from
his rebel opponents. And as conflict still rages in the breakaway republic,
it is perhaps no accident that an image of Russian triumph and rebel
submission takes prime place across a whole wall in the gallery.
The exhibition opened at a sensitive time for Russian president Vladimir
Putin and Chechnya. Today, while his troops are engaged in pitched battles
with separatists in the south and sweep through villages "mopping up"
anyone they consider to be terrorists, he insists that the military phase
of Russia's operations in Chechnya is over. Life is returning to normal, is
the latest Kremlin spin. Russian officials are drawing up plans for all
Chechen refugees in neighbouring Ingushetia to return to their homes.
Paradoxically, they insist the return will be both voluntary, and completed
by September 1.
Last week Putin dramatically changed his tone over Chechnya. He said Russia
had "failed" the Chechen people, and the mop-up operations had to stop. His
remarks were seen both as welcome sympathy for a war-weary people and as an
attempt by Putin to distance himself from a conflict whose human-rights
abuses and sheer horror threaten to show him up each time he tries to shine
on the world stage.
The timing of an exhibition that shows the Russian state as the benefactor
of the Chechen people is questionable. Akhmad Kadyrov, Chechnya's
pro-Moscow civilian leader, called the exhibition "the start of peaceful
life in Chechnya".
The works have received a care and attention that is almost touching. The
exhibition was opened with great aplomb, and featured speeches from
virtually every executive at the museum, the minister of culture and Duma
deputies for Chechnya. Foreign media were given a plush book detailing the
restoration process. In the unsigned historical introduction, the late
Chechen leader Dudayev is depicted as a thief who hoarded the works for
himself, and allowed a sacred museum to be used as a gun turret. The
Chechen rebels are thieves in the temple, stealing even the metal on the
picture frames, and trying to sell the paintings. Russian troops fly in not
as the levellers and scourges of Grozny but as the saviours of its culture.
Critics see the exhibition as a PR exercise. As Lecha Saligov, editor of
Moscow's Chechen newspaper Spravidlivost, says: "Russia wants to say
everything is OK in Chechnya, while war goes on."
But the museum staff see it another way. "This exhibition is very well
timed, not as a propaganda act, but as a warning sign for all those engaged
in wars now," says Alexei Vladimirov, director of the Igor Grabar Russian
Art Restoration Centre, who organised the restoration. "With this
exhibition we want to attract donations from the public for the rebuilding
of the Grozny museum. Both sides are to be blamed in the conflict. The art
is the victim. I do not think that life is peaceful in Chechnya now.
Perhaps that process is beginning. But people there still do not have homes
- like these paintings."
*******
#8
Yezhenedelny Zhurnal
July 4, 2002
DEFERRED PAYMENT
The war in Chechnya is likely to continue for some time
Author: Aleksandr Ryklin
[from WPS Monitoring Agency, www.wps.ru/e_index.html]
A YEAR AGO PRESIDENT PUTIN SPOKE VERY SHARPLY ABOUT CHECHNYA AND
WAYS OF SOLVING THE PROBLEM: MAINLY FORCE ACTIONS AND MILITARY
OPERATIONS. BUT NOW THE PRESIDENT IS CHOOSING A DIFFERENT TONE. THERE
ARE SEVERAL REASONS FOR THE CHANGE, BUT IT HAS NOT YET GONE BEYOND
RHETORIC.
Last week, Defense Minister Sergei Ivanov announced some exciting
news. He hastened to report that separatist guerrillas had intended to
recapture Grozny, the capital of Chechnya - but the federal forces had
forestalled the attempt. Ivanov also named the exact date of the
planned attack on Grozny: June 25.
Just two years ago, no one would have been surprised at such
news. Then, representatives of force agencies often made similar
statements (almost a dozen during the first year of the second Chechen
campaign). However, nothing has been heard about attempts to seize
Grozny lately. On the contrary, state officials, including the Federal
Security Service Director and the president himself, repeatedly
assured the Russian public that the military stage of the operation in
Chechnya was completed and only isolated bandit groups were wandering
in the mountains. Against the background of these statements, the
Minister's story that about a thousand guerrillas had been going to
seize the city according to a common plan and under a common command
suggested a thought that there were great discrepancies in Russia's
supreme power echelons as regards the situation in Chechnya. By the
way, Sergei Yastrzhembsky was the last to assert the absence of
operations in Chechnya, which was on the same day when Sergei Ivanov
reported on the prevented capture of the Chechen capital.
The main thing is that the inspirer and organizer of the new
crusade to Grozny was Aslan Maskhadov. The name of the Chechen
president is a few times mentioned in the statement of the Minister.
At the end of the statement, Ivanov traditionally accused Maskhadov in
connections with world terrorist centers and allowed journalists to
judge different pay sheets that indicated sums bandits received from
abroad.
Most observers immediately connected the new accusations
addressed to Maskhadov with his latest initiatives. The day before the
stirring statement, the Chechen leader sent G8 heads of state an
address (Putin was the first to receive the message) in which he
proposed ways to normalize the situation in Chechnya. Among them was
quite a specific measure - suspending hostilities from July 15
throughout all of Chechnya and resuming peace talks.
"It is clear that any contacts of federal officials with
guerrillas will mean the only thing for our force people: the power
drew a conclusion that efforts of the military for the establishment
of order in the republic had borne no result," commented one of the
presidential administration employees on the collision about the
statement of the Defense Minister and the letter of Maskhadov. "So,
Ivanov once again told the world about the villainies of Chechnya's ex
president. But he took pains in vain. No one had yet been going to
contact with Maskhadov. And by no means because of Ivanov. We are just
aware that this is not the figure that can settle matters there today.
A different thing is that force people have demonstrated for two years
their complete inability to resolve the conflict. This is apparent to
everyone already. Including the president".
These words seem reasonable. It turned out that Ivanov answered
not only Maskhadov, but also the president. The tough statements of
the defense Minister made a sharp contrast to what Putin said a few
days ago at his press conference. The Russian president apparently is
not going to lay emphasis to force actions and he admits that the
federal power is also responsible for the Chechen tragedy: "Now as for
the perfection of raids. Raids must not be perfected, they must be
simply ceased...One must proceed from reality, not search for the
guilty... Our task, taking into account that we are guilty ourselves,
consists in destroying the image of the enemy and terrorist in the
person of the Chechen". Meanwhile, a year ago on June 18, 2001, at his
first major news conference, Vladimir Putin very sharply responded to
a question about search operations in Chechnya, asked by a foreign
journalist. "These operations involve checking identity papers and
finding people who are wanted nationwide..." As for the attempt to
find out whether the change in the approach was possible, the
president said: "Here is my approach... and I am not going to change
it. What have you not understood in my answer? I was asked if I would
change the approach. I said no."
Nevertheless, the approach has evidently changed. "These changes
are to be now wonder," confirmed our assumptions the same Kremlin
interlocutor. "The president is a live person and his views of many
problems are in time transformed. Including that of the situation in
Chechnya. Frankly, little has lately improved there".
Shamil Beno, ex envoy of Chechnya to Putin, shared his view of
today's state of affairs in Chechnya: "There is no reason to speak
about any actual restoration of the republic as yet - not more than
1,500 houses of civilians have been rebuilt of dozens of thousands.
There are not any positive in relations between Chechens and federals,
too. What is to speak about if the natural disaster - I am speaking
the latest flood that fell at Russia's entire South, including long-
suffering Chechnya - to some extent proved a stabilizing factor: roads
were washed out, bridges - destroyed, and federals became unable to
move through the republic as before. This means there is less raids.
General Moltenskoi reports that he involved the army to struggle with
the element - it is quite plain, for if the military do not rebuild
bridges and roads, they will not be able to move in the mountains.
There are reasons to believe that a certain softening in Putin's
position was not only caused by an understanding of the actual
situation in the North Caucasus. In Russia itself, the attitude of
citizens towards the Chechen conflict has notable changed over the
last two years. Thus, according to polls of the All-Russia Centre for
Public Opinion Research (VCIOM), 68% of the polled spoke for the
continuation of the military operation in Chechnya in early 2000. Only
22% spoke for the start of peace talks. In spring this year, only 30%
of the polled backed the war. At the same time, 62% spoke for talks.
There is another circumstance urging Vladimir Putin to revise the
Caucasian policy. According to our data, in January this year a number
of chiefs of force agencies submitted the president the plan of
another military campaign in Chechnya. (There are reasons to believe
that it even included the possible invasion to Georgian territory, the
Pankisi Gorge). However, the president is most likely to have rejected
this plan exactly for the reason stated by our Kremlin interlocutor:
the Supreme Commander-in-Chief apparently does not very strongly
believe in the efficiency of his military leaders and the troops they
are in charge of.
However, change Putin's position as regards the proceedings in
Chechnya and his discontent with force people is unlikely to lead to
the rejection of the military solution of the problem - at least until
the end of the present presidency. Apparently, Putin is not going
further than rhetoric as yet. Our Kremlin sources maintain the
president assumes that a more liberal approach to the Chechen problem
might be perceived by the military as another humiliating
capitulation. Besides, despite obvious decline in the public support
of military actions in Chechnya, the Kremlin is firmly assured that
signing any document, even a little like the Khasaviurt agreement of
1996, will both seem Russian citizens a defeat in war and lead to fall
in the rating of Vladimir Putin.
However, drastic changes in the Chechen policy are not to be
expected mainly because neither the president, nor his companions have
a real plan of peaceful settlement in Chechnya. (Neither the idea of
dividing Chechnya Boris Nemtsov put forward a year and half ago, nor
the program of long-term gradual "implanting" of Chechnya into Russia
recently proposed by an American political scientist can suit Putin).
"On the instruction of the administration, we are gradually beginning
to work through issues of a new approach to the Chechen problem,"
shared a political scientist close to the Kremlin, "and there is one
distressing conclusion to be drawn already - there is no political
leader in today's Chechnya that could speak on behalf of his people.
Neither Maskhadov, nor, still less, Kadyrov suit for this role. This
means mechanisms to determine participants in the dialogue are to be
worked out. This work is at the very start".
So, the war in Chechnya will continue. There is a great distance
between the disappointment of Putin in force methods and the
transition to a constructive policy in the Caucasus.
(Translated by P. Pikhnovsky)
*******
#9
Financial Times (UK)
4 July 2002
Meanwhile, on the business pages...
By Robert Cottrell in Moscow
There are good days in Russia, and there are bad days in Russia. But there
are never boring days in Russia, and that is the country's great charm. I
sometimes think they should adopt "Never Boring!" as the national motto,
and emblazon it in big gold letters across the national flag.
In Russia even the company news is rarely boring. I know it would never
occur to readers of the Financial Times to think company news was ever
boring, especially in these days of Enron and Vivendi. But there is a
tendency in other quarters to view the general flow of reports, accounts,
annual meetings, that sort of thing, as less than captivating.
Well, all I can say is, try the Russian version. The big stories each day
in "Vedomosti" or "Kommersant", the main Russian business dailies, are like
soap operas crossed with morality plays. Big business in Russia may be
daring, dangerous, incomprehensible, stupid, depressing, even medieval at
times - but rarely boring. Too much is at stake.
For the past couple of months I have been trying to follow events at
Slavneft, a medium-sized oil company controlled 75 per cent by the Russian
government, 11 per cent by the Belarus government, 13 per cent by a
shifting consortium of private investors and 1 per cent by persons unknown
(or possibly a rounding error). I am not sure if we have come to the end of
the story yet, or merely a pause in the battle for control. But at any
rate, this is a good moment to take stock.
Until recently Slavneft was managed by a man called Mikhail Gutseriyev, who
made his first big money in the early 1990s by inventing an "offshore zone"
for tax-free investment in the very onshore Russian republic of Ingushetia,
a neighbour of Chechnya in the Caucasus. His brother tried to run this year
for the republic's presidency despite strong opposition from the Kremlin, a
detail which may well have earned the Gutseriyevs a black mark in President
Vladimir Putin's private scorebook.
In February this year the Russian government decided it was going to start
selling off its stake in Slavneft. And it apparently decided that the
company would be more saleable with somebody other than Mr Gutseriyev in
charge of it.
But would Mr Gutseriyev go quietly? I think you can guess the answer.
First, he brought in an ally called Anatoly Baranovsky from another state
oil company, Rosneft, and declared Mr Baranovsky the acting president of
Slavneft while he, Mr Gutseriyev, went on holiday.
Second, an opportune leak revealed that the government's choice to replace
Mr Gutseriyev, Yuri Sukhanov, a vice-president of Slavneft, featured
prominently in an equally opportune interior ministry investigation into
alleged sales of Slavneft oil to an overseas trading firm at below-market
prices.
Third, the Belarus government was persuaded to declare its support for Mr
Baranovsky as the new president of Slavneft, creating diplomatic tensions
with Russia.
Fourth, a tiny local court in distant Ufa, Bashkortostan, was prevailed
upon to declare illegal in advance the extraordinary meeting of Slavneft
shareholders needed to replace Mr Gutseriyev with Mr Sukhanov.
And fifth, Mr Gutseriyev decided to follow his holiday with a stay in
hospital. This practice is popular among troubled businessmen and
politicians because a law of sanctuary operates. In Russia you cannot sack
somebody while they are in hospital.
The scene was set. A president who could not be sacked; an extraordinary
meeting that might be illegal; shareholders divided; and a successor over
whom a large legal question mark had been hung. Chaos was guaranteed.
The shareholders' meeting went ahead in May, and Mr Sukhanov was elected.
The ousted Gutseriyev forces made a first attempt to reclaim the Slavneft
headquarters in central Moscow a fortnight later. They recruited two dozen
police from the suburbs at a cost of $150 each for the day. Backed by
private security men, the hired police invaded the building, turfed out Mr
Sukhanov's team and installed Mr Baranovsky in the president's office.
It worked, but not for long. Mr Sukhanov telephoned his friends in
government. They were a bit busy, since US President George Bush was
visiting Moscow that day, but for that same reason they were keen to avoid
public scandals. The on-duty police in the vicinity of the Slavneft
building were mobilised to clear out the off-duty police inside it.
Last week Mr Gutseriyev returned in person with a second and better-planned
assault on the Slavneft building, backed by anti-riot police and his
private security service. The cover story for this raid was that the police
wanted to seize documents relating to the inquiry touching on Mr Sukhanov.
But after doing that they sealed the building so that nobody could use it
at all.
On Monday the police let in Mr Gutseriyev, who explained that he must still
be in charge of Slavneft since nobody could have sacked him while he was in
hospital. Mr Sukhanov was refused entry, and adjourned to a posh restaurant
down the street where he placed more calls to ministers.
And again, he made some headway. On Tuesday Mr Gutseriyev was summoned to a
meeting at the prime minister's office, leaving the Slavneft presidential
suite free for Mr Sukhanov. Mr Gutseriyev's latest claim is that the
government wants him and Mr Sukhanov to run Slavneft jointly, though Mr
Sukhanov claims ignorance of this.
It would be easy enough to rationalise this cat fighting in terms of two
men's private ambition. But other forces are at work.
Before joining Slavneft two years ago, Mr Sukhanov worked for Sibneft, a
private oil company controlled by Roman Abramovich, a young tycoon with
excellent ties to the government of prime minister Mikhail Kasyanov.
Sibneft is a likely buyer of Slavneft in any privatisation - but you are a
fool to buy anything in Russia unless you have first-hand knowledge of
exactly what it contains. Having your own choice of chief executive
installed before the sale even takes place is the best way of doing that,
and Mr Sukhanov would fit the bill perfectly.
It is also assumed that behind Mr Gutseriyev stands a company wanting to
buy Slavneft. The gossip here favours Mezhprombank from St Petersburg.
It is a fact of life in Russia that bankers covet oil companies, so however
much Mezhprombank denies any interest in Slavneft, nobody is going to
believe it. Mezhprombank's founder, Sergei Pugachev, is now a member of
parliament and a leading light among the ex-KGB and ex-Petersburg types
that throng President Vladimir Putin's Kremlin.
For the moment it looks as if Mr Sukhanov and Sibneft are up, while Mr
Gutseriyev and Mezhprombank are down. But I wonder if the latter are quite
out.
For one thing, Mr Pugachev's reputation as a "grey cardinal" of the Kremlin
is on the line. He really cannot afford to lose this one. For another, Mr
Gutseriyev seems to have great staying power. In a recent newspaper
interview, albeit on another subject entirely, he came up with an
extraordinary turn of phrase to illustrate the value of patience. "If you
sit by the side of the river long enough, you will see the body of your
enemy float by", he said. I do hope Mr Sukhanov can swim.
*******
#10
Iraq Willing To Pay Off $8 Bln Russian Debt - Ambassador
July 4, 2002
DOW JONES NEWSWIRES
MOSCOW (AP)--The new Iraqi ambassador to Russia Abbas Khalaf Thursday said
his country is willing to pay off its $8 billion debt to Russia , a
long-standing sticking point that has prevented the two countries from
improving economic ties.
Khalaf also said Iraq was prepared to allow Russian oil companies to help
develop some of his country's oil fields, which is currently forbidden
under U.N. sanctions imposed after Iraq's 1990 invasion of Kuwait.
"Iraq is ready to pay its debts," Khalaf said. "Iraq can't pay Russia its
debts because of the sanctions."
Iraq had very close ties to the Soviet Union and at one point about 70,000
Russian specialists, including engineers, construction workers and aviation
workers were based in Iraq. Those close ties continued after the 1991
Soviet collapse, and Khalaf cited a Russian Foreign Ministry document that
said Russia had lost $30 billion in trade as a result of the sanctions.
Russian oil companies, some of which are flush with cash, are eager to move
into Iraq and develop fields to which they have rights. Khalaf said Iraq
would welcome Russian participation in the restoration of its oil-producing
capacity once the sanctions were lifted.
Khalaf accused the U.S. and U.K. of conspiring to deliver an economic blow
to Russia by keeping the sanctions in place, thus preventing Russian
companies from doing business in Iraq.
Khalaf said he was optimistic about the new round of talks between Iraq and
the U.N. that were starting Thursday in Vienna.
"Iraq has approached this dialogue constructively, with good intentions, in
a good mood, with good will to resolving the issues between our two sides,"
Khalaf said. "I look forward to this dialogue with optimism."
Khalaf said the issue of the return of U.N. weapons inspectors, which the
U.S. and U.K. say is crucial for any discussion of lifting the sanctions to
succeed, didn't depend on Iraq.
In recent months, Russia has tried to act as an intermediary to help
persuade the Iraqis to allow the inspectors to return. Khalaf said Iraq and
Russia had an "intensive" dialogue but there were "nuances" in their
positions on a number of issues. He wouldn't elaborate.
Asked whether Russia's shift toward closer relations with the West that
occurred following the Sept. 11 terrorist attacks in the U.S. had had an
impact on Iraq's relations with Russia , Khalaf said: "We respect Russia's
course and we don't intend to interfere in that."
*******
#11
From: EWI Policy Studies Program
Subject: EWI Russian Regional Report -- 3 July 2002
Date: Wed, 03 Jul 2002 05:16:24 -0700
RUSSIAN COURTS PUBLISH DECISIONS ON THE WEB
by Alexei Trochev
In the past few years, the Russian judiciary has begun to publish its
decisions on the Internet, greatly improving the general public's access to
court decisions.
Constitutional Courts
Russian Constitutional Court has its own website (ks.rfnet.ru),
which contains all decisions (postanovleniia) and some rulings
(opredeleniia). Several regional constitutional/charter courts also
maintain web sites. Karelia Constitutional Court
(www.gov.karelia.ru/Law/index.html) has a regularly updated site with
decisions, the by-laws of the court, and short biographies of the justices.
For the text of dissenting opinions, search for "osoboe mnenie" at the
website of "Karelia," the official newspaper of this region
(www.gov.karelia.ru/gov/Karelia/search.html). Sverdlovsk Oblast Charter
Court (ustavsud.ur.ru/1.htm) has similarly detailed information on the
justices and their work. This site also has several publications by the
justices as well as data on the implementation of the court's decisions in
2000. The St. Petersburg Charter Court
(ustavsud.spb.ru/content.asp?cnt=114) is also present on the web thanks to
the efforts of the St. Petersburg State University law school students.
This website contains fewer court decisions (only for 2001) and has only
brief biographies of the judges.
Courts of General Jurisdiction
Unlike federal and regional constitutional courts, Russia's regular
courts form a hierarchy with the Russian Supreme Court at its apex. The
federal Supreme Court (www.supcourt.ru) has information about its work and
contains links to a dozen regional courts, including two military courts.
The majority of the regional courts' websites simply list the courts'
addresses, working hours, and contact information. The Krasnodar Krai Court
site (kks.krasnodar.ru) also explains how to file a suit. The Chelyabinsk
Oblast Court is famous for its televised criminal trials. Its website
(www.ural-chel.ru/gubern/obl_sud/index.htm) contains materials on the
information technology to support such practices. The Bryansk Oblast
Judicial Department's site (www.debryansk.ru/~suddepbr) devotes attention
to this issue as well as to the work of the justices of the peace in the
region.
The website of Omsk Oblast Court (www.oblsud.omsk.ru) has
statistics on the cases heard in 2001 and early 2002, a monthly schedule of
civil and criminal cases, and a review of publications about the court in
the local media. The Leningrad District Military Court
(www.dk.ru/voensud/INDEXX.HTM) has a database of its decisions issued from
1999 through mid-2001 and a short essay on the history of military courts.
The Pskov Garrison Military Court (www.psc.ru/voensud) posts certain
decisions issued in 2000 and templates for filing complaints. The most
valuable and regularly updated website (www.scourt.vens.ru) is hosted by
the Ulyanovsk Oblast Court and provides a wealth of information on this
court's jurisprudence, judicial reform, etc. It even has the minutes of the
meeting of the oblast conference of judges.
Among local courts, the Moscow District court in the city of Tver
offers the most informative and up-to-date homepage (www.mossud.tver.ru)
with all court decisions since 2000 and templates for complaints, claims,
and civil actions in various categories. This is the only local court that
publishes its own decisions. The Usinsk City court in Komi Republic
(www.usinsk.com/sud) has some statistics for 1997-99, claim forms and
contact information for judges, the Bar, the procuracy and the court
bailiffs. For an extensive analysis of local courts in Rostov Oblast in
2000 conducted by local NGOs, visit www.hro.org/docs/reps/judge/index.htm.
Arbitration Courts
The Supreme Arbitration Court maintains a website (www.arbitr.ru)
with an extensive database of its decisions, the contact information for
all lower arbitration courts, an archive of publications about them, and
statistical data on the work of these courts during 1992-2001.
The Northwestern District Arbitration Court (www.fas.spb.ru) has a
wealth of data on its work, including helpful information for litigants.
This court posts its own quarterly journal "Arbitrazhnye spory" on the web
at www.kadis.net/asp/asp_view.php3, which you can read free of charge after
registering. There you can also view the texts of bills under consideration
by the St. Petersburg Legislative Assembly.
The Moscow City Arbitration Court (www.msk.arbitr.ru) boasts a
database of over 500 decisions issued in 1999-2001, statistical data on the
court's work since 1998, contact information, and claim forms. The Omsk
Oblast Arbitration Court (www.omskarbitr.ru/index.htm), posts a daily
schedule of its casework and texts of decisions issued in October-November
2001 and April-May 2002. One judge of this court has his own website
(chucha.omskarbitr.ru) with several publications and court decisions.
What do judges and lawyers think about the electronic dissemination of
court decisions? Find out by viewing:
www.femida.ru/mainmenu/TLaw/conferens.html for their comments at an October
2000 conference on judicial transparency. For the most interesting court
decisions and commentary, visit pi.agava.ru/courts,
moscow.hrights.ru/sud/sud.htm, www.arbitr-praktika.ru, and
www.interfile.ru/sudy.shtml.
*******
#12
From: Chapmandon@aol.com (Don Chapman)
Date: Wed, 3 Jul 2002
Subject: RUSSIAN TRIP APRIL/MAY 2002
I am enclosing an article which I recently wrote about my latest trip to
Russia. I am on the Board of Directors of an organization called Center
for Citizen Initiatives, which is a business training program for Russian
business people. I have visited Russia eight times since 1987. I am not a
"professional" Russian person, so these are only my personal views. This
is a voluntary position and I have never taken one cent from this
organization.
Dear Friends, I visited Russian for my eighth time during the last part of
April and the first part of May. An old Navy buddy accompanied me on the
trip and it was his first trip to Russia. Here are my impressions from the
latest trip. I would appreciate any comments or feedback that you might
like to share with me. Cheers, Don Chapman
RUSSIAN TRIP APRIL/MAY 2002
Russia is a totally different country today, from the one that I first
visited in 1987. The amount of change is really incredible. In 1987 they
had two colors of paint, drab and extra drab. But today they have brightly
painted buildings, advertising signs everywhere (absolutely none in 1987)
and bright colors in their clothing. In addition, you can no longer spot a
foreigner by looking at their shoes, as you could in 1987.
The young people in Russia are doing OK and some of them are doing very
well, however, this is not true for the old folks. It is very, very sad,
but the older folks are suffering if they do not have a child or grandchild
to help take care of them. These people have been in the wrong place at
the wrong time. They have worked all their lives and the government said
they would take care of them, but now the government is not taking care of
them. Inflation has totally eroded their pensions and they cannot buy
enough food to eat on the average pension of about $30.00 per month!!
On the other hand a young man who was a student at the University when I
met him in 1989 drove up in a new BMW and took my friend and me out to eat
at a very nice restaurant, then on a boat ride thru the canals of St.
Petersburg and paid for everything. So obviously, he is doing quite well.
We also got to meet his wife and small daughter, and they were both quite
lovely.
Some other good news is that the Business Environment is much better. They
still do not have a banking system as we know it in the US, but a new man
has just been appointed to head the Central Bank and it is felt that he
will begin the necessary changes to bring the banking system inline with
the West. Business Law is still quite weak, but they are aware of the
problem and working on it. The Mafia is not nearly as influential as in
the past and bartering is completely gone. However, the Official
Corruption is still quite rampant. This is the building inspectors, the
fire inspectors and other such "officials" who come to the businesses,
solely to wring out a bribe from the business owner. However, everyone is
now aware of the problem and steps are being taken to correct the
situation, but it is not going to happen overnight. The reason I went to
Russia was to attend an "Anti-corruption Conference", however, it was
canceled, but was rescheduled for September. So stay tuned.
The Political Environment is vastly changed and the results depend on your
personal views. Putin is concentrating an awful lot of power in the
Presidency, which causes some of us great concern. However, the Russians
do not seem to be to upset about this situation as they say it is going to
take a "strong hand" to get the economy and political situation straighten
out. Most of the nationwide press critical of Putin has been shut down
under one pretense or the other, however, there are still many local press
people who are quite critical of the government. Again, some of us are
very concerned about this, but the Russians do not seem to be bothered by
this development. A most interesting thing to me is that Putin's approval
rating is quite high. Most of our interns did not vote for Putin in the
last election, but now they overwhelming support him. Although several
said they approve of Putin and what he says, they will wait and see if his
thoughts and words get down to the local level. So there is some
skepticism about his words being transferred into deeds. One significant
accomplishment has been the passing of a 13% flat tax rate. (I wish we
would pass that here in the US). That has increased government revenue as
businesses have left the "mattress economy" and joined the regular economy.
It would be even more successful if local governments would follow suit,
as it still is a problem for small business's. If they declare for the
national flat rate, many local governments still have totally unrealistic
tax rates, But hopefully, time will fix that as local governments see the
benefit in a lower tax rate that everyone pays.
Another significant accomplishment was the passing of a law allowing
private ownership of land in the cities. This will allow businesses to
have collateral for loans, which they now do not have. The government says
they are going to pass a law for private ownership of agriculture land, but
it has not done so yet. This is a very emotional issue for the Russian
people and the outcome is not clear at this time.
The interns that the Center for Citizens Initiatives (CCI) have brought to
the US for business training are in almost all cases doing extremely well.
They all sing the praises of their US visit and are strongly supportive of
CCI. They are forming business associations and are starting to network
among themselves. Another very positive development is that the Interns
are starting to lobbying local officials about their problems and the help
that they need from the government. In one local area the small business
people organized after the local government decided to raise their taxes
and threatened to shut down their businesses rather than pay the new taxes.
The government then backed down, giving the business people a new sense of
power. The Russian economy has been growing quite rapidly. During the
last two years they have had a growth rate of about 5% which is very good
for an economy.
Of course, their base line was rather low, but this shows that they are on
the right track and that there is hope for the future. Most Russians that
I met are quite optimistic about their future and this is a very good
development, in my opinion.
There is a book by two British authors, called "The Coming Russian Boom".
They missed their time line, but I think they are correct in the long run.
The Russian people are highly educated, they have more natural resources
than any country in the world, and they have a huge pent up demand. As
soon as they get the political/economical situation straighten out, they
will take off in my opinion.
As just a reminder I would like to share a few statistics with you. In the
United States we had 498,000 soldiers killed in the Civil War and 407,000
killed in the Second World War (292,000 in combat in Germany and Japan and
the rest operational losses). These are the two wars in which we lost the
most people and the total for BOTH wars is 905,000. Yet the Russians lost
20,000,000 in the Great Patriotic War (which is what the Russians call
WWII). They lost 6,000,000 in WWI and they do not know exactly how many
Stalin killed in the 30's (est varies from 5 to 15 million), so the Russian
people have suffered and suffered. Some other interesting facts are that
the present day Russia is twice as large as the United States and they have
11 time zones versus our 6. And a final fact that very few Americans know
about is that the United States had troops in Russia fighting on the White
Russian side (against the Red Russians) until 1922 -- FIVE YEARS AFTER THE
REVOLUTION OF 1917.
So, in summation the Russian people and economy have undergone a most
dramatic change. 100 years ago 98% of the Russian people were serfs. Then
they had to deal with the Soviet era for 70 years and now they are on a new
path with democratic elections and a capitalist economy. So the amount of
change thrust on the average Russian citizen is something that few of us in
the West could possibly understand. It is totally incredible in my opinion
that they have made this change with so little bloodshed and so little
domestic upheaval. Things have a long way to go before the Russian people
start enjoying the "good life", but they seem to be on the right track at
this time, eventho, the overall change is uneven.
Finally, my comment, is that there is nothing that is more important for
our children and grandchildren than for the Russians to maintain there
capitalist economy and democratic institutions. If they do so, then our
children can compete in the market place instead of having nuclear weapons
pointed at each other. Thus, it is in our own self interest to help the
Russians as much as possible to achieve this goal. The CCI intern program
is teaching them how to fish, and not giving them a fish. And it is
working beautifully. If any of you would be interested in hosting a
delegation of Russians in your community, please contact me and I will make
it happen. Please contact me at chapmandon@aol.com
*******
#13
Wall Street Journal
July 4, 2002
Russia Airline Signs Airbus Lease, Snubbing Local Aviation Industry
By GUY CHAZAN
Staff Reporter of THE WALL STREET JOURNAL
MOSCOW -- OAO Sibir, Russia's second-biggest airline, plans to lease two
Airbus jets, marking its first acquisition of Western planes and a blow to
Russia's ailing domestic-aviation industry.
Buoyed by a big increase in passenger traffic over the past two years,
Russia's regional airlines badly need new aircraft to replace their aging
Soviet-era fleets. Most would prefer to buy cheaper home-grown Tupolevs and
Ilyushins, but complain of chronic production delays and the lack of any
effective system of leasing new planes.
Sibir, which is 25%-owned by the Russian government, said it had signed a
memorandum of understanding to lease two jets of the single-aisle A320
family, one from Australian airline Ansett and the other from International
Lease Finance Corp., a U.S. jet-leasing company.
A spokesman for the airline, Mikhail Koshman, said talks were under way with
the Russian government to waive import tariffs on the planes, which add an
extra $25 million (€25.4 million) to the price of each plane. He declined
to
say how much the leasing deal was valued at, but said it could come unstuck
if Russian authorities refuse to lift tariffs.
With the crisis in the global travel industry bringing down the price of
leased Western aircraft, Russian airlines can now better afford to shop
abroad. They have been deterred by hefty government levies -- a 20% import
tariff and 20% value-added tax -- on foreign planes. Russia is under intense
pressure from the U.S. and Europe to reduce the duties as a condition for
joining the World Trade Organization.
Russia's 6,014 airliners mostly date from the Soviet era, and officials say
more than half will have to be scrapped over the next three years. Strict new
European Union noise requirements that came into effect this year bar more
than a quarter of Russia's fleet from EU airports. Even tougher rules from
2006 will ground almost all Russian-made planes.
Aerospace officials say that with Russian passenger volumes expected to grow
around 5% a year, 500 new passenger jets will be needed by 2010. Russian
aircraft manufacturers are unlikely to be able to supply them all. Russia
does have two new airliners, the Tupolev 204, the equivalent of the Boeing
757, and the wide-bodied Ilyushin 96. But the factories that make them have
been plagued by financial troubles.
Sibir lost a Tu-154 in October when it was blown out of the sky by a
Ukrainian missile during a training exercise and now has 50 planes, including
two Tu-204s. It paid for six other Tu-204s but the manufacturer hasn't
finished building them yet.
Aeroflot, Russia's national carrier, has led the way in buying
foreign-manufactured planes, which it says it needs to compete with Western
airlines on its international routes. The airline now has 27 Boeings and
Airbuses, making up almost a quarter of its fleet.
Meanwhile, another Russian airline, KrasAir, said it is in talks with Boeing
Co. to lease Boeing 767s. A spokesman, Alexander Sokolov, said the company
would prefer Russian planes, which he said are cheaper and easier to service.
But he said Russia hasn't yet developed a reliable leasing system for
domestically made aircraft. "Until the government works out how we can lease
Russian aircraft, we will have to think about leasing Boeings instead," he
said.
*******
#14
Russia Wants U.S. Chicken Certified
July 4, 2002
MOSCOW (AP) - Russia threatened to renew its ban on U.S. poultry imports
Aug. 1, saying Thursday the ban would be renewed if U.S. producers fail to
provide new veterinary certificates.
The Russian government imposed a ban on U.S. poultry imports in March,
citing concerns about sanitary conditions at U.S. plants and cases of
salmonella in imported chicken.
The ban was lifted a month later, after the United States promised to
tighten export controls, but new bureaucratic hurdles have delayed a full
resumption of imports.
U.S. officials, who wrapped up the latest round of talks on Wednesday, have
repeatedly expressed hope that the two sides were close to an agreement and
that the U.S. poultry industry would again find a stable market in Russia.
The Agriculture Ministry warned that if the United States was not ready to
comply with the new certificates, Russia would have to bar all imports of
American poultry.
``The result is that the import into Russia of poultry from the United
States would be practically impossible from August 1,'' the ministry said
in a statement.
Poultry with the existing certificates will only be accepted until July 31,
the ministry said. But Russian agriculture officials emphasized that they
are ready to continue discussions with the United States.
The United States has lobbied for the deadline to be pushed back to Oct. 1.
Before the dispute, U.S. producers in 38 states sent $600 million to $700
million worth of poultry to Russia each year.
*******
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