Friday, August 01, 2014


Russia

Western CEOs Quit Russian Business Forum Over Ukraine Crisis

Russian President Vladimir Putin (left) meets with Siemens CEO Joe Kaeser at his Novo-Ogaryovo residence outside Moscow on March 26. Siemens is one of the German firms that will not attend the forum.
Russian President Vladimir Putin (left) meets with Siemens CEO Joe Kaeser at his Novo-Ogaryovo residence outside Moscow on March 26. Siemens is one of the German firms that will not attend the forum.
In a demonstration against Russia’s annexation of Crimea and Moscow’s role in the Ukrainian crisis, the leaders of dozens of major international companies have cancelled their attendance at a three-day international business forum that opens in St. Petersburg on May 22.

In Germany, the chief executives of Deutsche Bank, the engineering giant Siemens, and the energy firm E.ON confirmed on May 21 that their CEOs will not participate in the annual event this year.

They are joining executives from three dozen other international firms that have turned down invitations to the St. Petersburg International Economic Forum, where Russian President Vladimir Putin is scheduled to be the keynote speaker on May 23.

In his greeting message to participants on May 22, Putin said Russia "is ready to broaden multifaceted contacts with all partners on the basis of true equality and respect for one another's interests."

The U.S. government had appealed to American executives to cancel their attendance.

German Chancellor Angela Merkel’s office said her government met on May 19 with German business leaders to discuss the government’s position on the Ukraine crisis ahead of the Russian forum.

Merkel’s office said it did not make any recommendations on whether German business leaders should attend.

Russian firms traditionally time the signing of their investment agreements to coincide with the forum.

But Russia is facing international sanctions -- and the threat that entire sectors of its economy could be sanctioned in the future by the European Union and the United States -- over reports of Kremlin support for pro-Russian separatists in eastern Ukraine ahead of that country’s May 25 presidential election.
 
That has raised concerns among international investors about the risks involved with making deals with Russian companies.

In Shanghai on May 21, Russia’s state-controlled energy giant Gazprom announced that it had signed a memorandum of understanding on a deal to deliver $400 billion of natural gas to China over 30 years, beginning in 2018.

Russia and China had been in negotiations on the deal for more than a decade, but a final agreement has been delayed due to pricing disagreements.
 
Gazprom chief Aleksei Miller refused on May 21 to disclose the exact price that his firm agreed to sell natural gas to China, calling it a commercial secret.
 
But analysts say Russia likely had to reduce the price it was asking in order to reach a deal that makes the company less dependent on earnings from exports to Europe -- which could be targeted by threatened energy-sector sanctions.
 
China has been relying on dirtier coal to meet its energy demands and fuel its economic growth, leading to widespread air pollution problems in many Chinese cities.
 
Based on reporting by Reuters, AP, Interfax, and ITAR-TASS

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