Saturday, November 01, 2014


The Power Vertical

Putin's China Syndrome

Unlike China's leaders, Vladimir Putin has opted to hang on to power indefinitely.
Unlike China's leaders, Vladimir Putin has opted to hang on to power indefinitely.
The Moscow punditocracy has had China on its mind lately. In fact, one leading commentator even confessed to suffering from "China envy."
 
When the Chinese Communist Party elected the country's new top leaders earlier this month, with Hu Jintao relinquishing power to Xi Jinping, many in Russia's chattering classes noted how favorably the system stacks up to their own.
 
"The Chinese have managed to do something the Russians can never pull off: to stop relying on great and irreplaceable individuals, and instead put in place a system of regular change of [its] top leaders," Mikhail Rostovsky wrote in "Moskovsky komsomolets."

Since 1992 -- when Deng Xiaoping turned power over to Jiang Zemin -- the rule has been two five-year terms and out.
 
The contrast with Russia, where the political system revolves around the indispensible Vladimir Putin, was noted everywhere from the opposition tabloid "Novaya gazeta" to the business-oriented "RBK Daily," to the official government broadsheet "Rossiiskaya gazeta" -- which, quite interestingly, called the Chinese model "an instructive model for other countries."
 
In the daily "Kommersant," Aleksandr Gabuyev wrote that the Chinese leader is "only the first among equals in a sort of 'board of directors' for the PRC, which avoids a situation in which the country is ruled for too long by a sickly and aging leader who has stayed too long atop the power vertical."

Putin, of course, had the chance to implement something akin to the Chinese model last year. All he had to do was bless Dmitry Medvedev's bid for a second term as president, as the technocratic wing of the elite was urging him to do, and maintain his decisive influence behind the scenes -- as Deng Xiaoping did in his day.
 
But that, of course, did not happen. And by opting to return to the presidency for six -- and possibly 12 -- more years, Putin is being compared not to Deng but to Leonid Brezhnev.
 
"Both looked young and attractive at the beginning of their rule and both looked sickly and comical toward the end. Both let the right historical moment for their departure slip by, ran out of steam, and survived in politics," political analyst Stanislav Belkovsky wrote in Slon.ru.

The Brezhnev comparisons, which began in earnest about a year ago and enjoyed a revival with recent rumors about the state of Putin's health, have become a bit overdone and old hat by now.
 
But one aspect is very relevant to Russia's future. It wasn't only Brezhnev who looked old and sickly by the end of his rule but the entire Soviet elite. This cadre, known as the Class of 1937, rose to power in the wake of Stalin's purges -- and remained there until their deaths.
 
And many observers are now wondering whether the same will happen with the entire Putin team. This would keep the rising generation, which came of political age after the fall of the Soviet Union, eternally frustrated and on the outside.
 
"Putin has demonstrated a willingness to keep management of the state in the hands of his trusted people, who will soon be of retirement age, until the end of the decade," analyst Viktor Averkov wrote in "RBK Daily." "In order to avoid a generational conflict, he needs to study the mechanisms of succession and the transfer of power."

There is little evidence that he is doing so. In fact, as columnist Sergei Shelin illustrated in a recent piece in Gazeta.ru, Putin's much vaunted mini-purge of the elite after a series of corruption scandals amounted to little more than shuffling around some familiar faces into new posts.

"The purges at the Defense and Regional Development ministries, as well as in other departments and regional structures, seemed to promise the desired posts to those who have grown tired waiting for them," Shelin wrote. "But the paradox of Putin's personnel purge is that the reshuffles of the establishment are in full swing without any hint of upward mobility."
 
Shelin adds that "the Kremlin is shuffling one and the same pack of cards" with "heavyweights" and their "entire close-knit clans moving from place to place."
 
There was a time when many observers, myself included, thought Putin's long-term goal was to build an enduring and stable (albeit authoritarian) system that would endure beyond his time in office.
 
What is becoming abundantly clear is that no such strategic goal exists. There are only tactical maneuvers aimed at survival -- which, paradoxically, makes for the most unstable system of all.
 
-- Brian Whitmore
This forum has been closed.
Comment Sorting
Comments
     
by: Camel Anaturk from: Kurdistan
November 27, 2012 21:19
Well well well.we all thought Eugenio and Jack were top of the pops for writing crap posts,but now mr.Whitmore has dumped them both.`Vladimir Vladimirovitch is a `great and irreplaceable individual` and not the usual run-of-the mill kgb Sharik homunculus??? Ha,bloody ha-we dont have to wait for another 988 years-this is the joke of the last Millenium.Molodets,Brian-did you inspire Monthy Python`s Life of Brian???

by: Mark from: Victoria
November 28, 2012 18:17
Could this, finally, be the tipping point? Is Putin on his way out? Is he leaving long fingernail grooves on the floor of his office as bureaucrats swooning with China-love drag him out, while black-clad Kremlin PR flacks flutter about like crows as they cook up an implausible explanation for his abrupt departure - perhaps his health, comrade?

Ha, ha; no, come on, I was just kidding. No, really, I was just trying to lighten the mood - seriously, look, Brian has characterized this supposed abdication of Russia's present government in favour of a smart new Chinese model - which will presumably not include Putin - in his Twitter feed as "another indication of Putin fatigue".

Is there really a cresting wave of anything that could be described as "Putin fatigue"? Really? Oh, I don't mean in the west and among the miniscule liberal opposition in Russia, because they've been nursing Putin-fatigue since...mmm, about 2001. I mean among the Russian electorate, which actually put him into office and may well do so again. No, I would have to say not; his popularity figures have remained relatively stable and they are often framed as figures any western leader would sell his mother into bondage for, although of course they indicate failure in Putin's bloody-fanged dictatorship. No cause for celebration there.

Well, wait; maybe the economy is crashing to the ground! No, sorry; manufacturing orders have risen for 13 straight months according to HSBC analysts, new hires are up for 3 straight months and the banking sector has shown strong growth in the first half of 2012, with retail leading the way. Things look headed in the opposite direction from collapse, actually.

Well, then, let's look at the Chinese government's relationship with Russia, and see if we can get the real story.

http://news.xinhuanet.com/english/china/2012-09/06/c_131832674.htm

Oh, look. It's Russian Federation Council Speaker Valentina Matvienko, meeting with the Chairman of the Standing Committee of China's National People's Congress. On the occasion of the sixth meeting of the China-Russia Parliamentary Cooperation Committee, not to put too fine a point on it. China-Russia government cooperation is not only not new at all, but is part of a formalized process. Although there is nothing to suggest Russia is about to implement a wholesale adoption of the Chinese government model, I daresay areas of innovation in each country are noted by the other and implemented so as to best serve each country.

I imagine you noted, even without looking at the referenced article, that Russia's delegate to the China-Russia Parliamentary Cooperation Committee is a woman - not too many Russian men are named Valentina. But, just for fun, take a look at the photo on page 2 of that article. How many women do you see?

If you don't feel like looking, I'll save you the trouble. Two, one of which is Matvienko. I can tell you one group that is not anxious to see Russia adopt the progressive Chinese government model - Russian women. Women are sorely under-represented in the Chinese government, although they do quite well in business.

http://chinadigitaltimes.net/2012/03/china-still-a-mans-world/

By way of contrast, in Russia women make up more than 50% of federal administrative posts, range from 33% to 64% in all branches of power at the state level and are 11% of the General assembly.

http://www.un.org/News/Press/docs/2010/wom1812.doc.htm

I note that all the excited comments in the body of this post, which support the view of China's government as an instructive model for other countries, came from men.


by: Mark from: Victoria
November 28, 2012 18:27
Sorry; I went over the character limit and had to do a second comment to get my conclusion in.

Look; almost every government has its success stories, and there are doubtless valuable lessons to be learnt from China's government. But Russia is no more likely to adopt a Chinese government model owing to pressure from western governments or think-tanks than it is to adopt American-style government owing to pressure from western governments or think-tanks. Why not? Because both have the same short-term goal: get rid of Putin, pick someone else. And as long as the Russian economy continues to flourish under Putin after nearly sliding over the edge under the western-supported and western-encouraged Yeltsin, that is simply unlikely to happen. Despite the bi-weekly tipping point and regular injections of wistfully-hopeful doom for Putin, none of that is really happening.

On this blog, it's always the same time of day - sunset for Putin. The view is regularly advanced that he should have burnt out like a torch that consumes itself, at the height of his glory, like Jimi Hendrix, instead of a fat, peanut-butter-smeared travesty of his former self, like Elvis, who stayed far past his pinnacle. And that's a nice story.

Just as long as you don't confuse it with reality.
In Response

by: Anonymous
November 28, 2012 23:42
I actually don't disagree that Putin is unlikely to leave power till his mortal abode disintegrates into dust. That is indeed the most likely path for the future. What's more, I even think Brian above also thinks that.

I believe the main point you're missing is that it would be eventually better for Russia if Putin left, and someone more politically progressive took over. If, indeed, Russia could move towards becoming a democracy.

That is what fuels the, let's call it wishful thinking, that you detect in the blog: the idea that things would be better for Russia if Putin left, but that this is unlikely to happen. He'll probably stick around, Brezhnev style, for as long as he can. But if he did... what a big country like Russia could then become, with its resources and human capital, is mind-boggling.

Judging by the size of your comment, and the general tone, you disagree with this main point: that Putin is not good for Russia in the long run. Do you really think Russia is better off as an autocracy in the old South American style than it would be as a real democracy? Do you think Putin's way is really the way to go for this country whose history is so full of people who were convinced their personal views were the only solution to today's problems?
In Response

by: Marko from: USA
November 29, 2012 12:12
Politically progressive-- like Boris Yeltsin? How did that work out (not for the West mind you [for which Russia in the 1990s was a perfect result]) but Russia? There you have your answer as to what Western-style liberalism (aka progressivism) under Western management in Russia looks like-- that picture is far less pretty than the generally successful , albeit flawed, Putin era. Mark from Victoria masks some excellent points on that subject. Anonymous might have something of a point if there was a "patriotic liberal" option available in Russia today politically, but it is one of the paradoxes of Russian history that there never is such an option for governance there.
In Response

by: Mark from: Victoria
November 29, 2012 21:23
A lot of people seem to be under the impression that, because Vladimir Putin remains leader of Russia, Russia is not a democracy. I beg to differ. While he unquestionably desires the office, and likely will serve another term following the present one if he is elected, it is not up to him whether he stays or goes. It is up to the electorate, which is - by definition - democratic in that all eligible citizens share an equal right to self-determination. Is it your contention that, had Putin failed in the presidential vote, he would have mustered the guard and imposed his rule on Russia by force of arms? I highly doubt it. I imagine that had it shaken out like that he would likely have retired; at the very most he would have remained an influential member of his party and active in national politics. That possibility is not a serious consideration, as he was most decidedly elected by a majority of the people; a fact which was undisputed by democratic leaders, although many were clearly unhappy about it.

There's not enough space here to get into the prevalence of voter suppression in democratic countries, but suffice it to say that all incumbent governments use every trick at their command in order to remain in power. Moreover, many established references correctly point out that the "purity" of democracy is now blurred, as nearly all contemporary governments contain mixed elements of the oligarchic, monarchistic and democratic models. It hardly needs saying that all refer to themselves as democracies.

If the main point of the post was that Putin is not good for Russia in the long run, the author did a good job hiding it, although he clearly would like to see Putin removed by whatever means and a liberal reformer even more liberal than Medvedev installed in his place. I interpreted the post to mean that Russian bureaucrats are eyeing the Chinese model of government with a view to adopting it. I might as well say here that this is ridiculous, because China remains Communist while Russia would not go back to Communism even if the Communists were elected - they would have to run it as something of a democracy and it probably would not look much differently from what it does today, although the state would resume control over some things that have passed into the private sector. But there is much about the Chinese model that remains unatractive to Russia, while they have likely already adopted such elements as appealed to them; the two countries enjoy very close ties.

Nonetheless, yes; I do dispute it. Putin has been good for Russia thus far, continues to be good for Russia and will likely be removed by the electorate as soon as he convincingly is not. Never mind the red herring about whether I consider Russia to be better off as an old South-American autocracy, because it isn't.
In Response

by: Marko from: USA
November 29, 2012 00:00
On the whole well put. Putin, however, tends only to ameliorate problems instead of truly solve them and Russia isn't in the same global weight class as China these days. That said, the contrast between Russia in the Putin era and the Western-guided Yeltsin era could not be greater. This was I think, in large part because Putin's goal-- often fairly effectively pursued-- was to revive Russia. The goal of the preceding liberal era was to dismantle the country (like a bankrupt business) and divide up its assets; failure of Russia was the goal and its peole were treated like a nuisance.

by: Vakhtang from: Moscow
November 29, 2012 05:52
Mr. Whitmore decided to play a cunning game...Turning to the Russian press, and to a discussions of Russian journalists Mr.Whitmore on the subject prefers to remain silent.
He does not want to say that progrеss in China is primarily connected with the policy of the Communist Party with brutal repression and mass executions...

just imagine:

Luzhniki Stadium
100,000 spectators- the Russian workers and peasants (all drunk as usual)...in the middle of the pitch-Serdyukov, Vasilieva, Skrynnik and Smetanina on their knees..Bastrykin behind with a Mauser..with words:"For the Motherland! For Putin!"shoots in the heads of embezzlers and perverts..I am sure that after this, the number of brothels in the ministries will be reduced immediately.
All such acts, it is the norm for China, that is why there is progress.
Unfortunately Putin takes out his anger on the defenseless women...Mass executions of officials,torture by fire and water of officials,will lead to an economic breakthrough of Russia...
In Response

by: Camel Anaturk from: Kurdistan
November 29, 2012 12:44
Quite agree with the Vakhtang team of BS BW experts,however,we dont need mass executions-just one will do-that of the greatest georgian patriot who ran as far away from his motherland to the land of those he castigates daily-and that is his stepmother Russia.`Torture by fire and water says Vakhtangovitch`-too costly say I - just force them to drink a cuppa georgian wine - the results would be far more devastating-for just a fraction of the price.Then we may think of resettling all persons of Caucasian origin in Georgia,and if you want to punish them russians -well then you must resettle all St.Georgians there!!!

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18:26 October 31, 2014

EVENING NEWS ROUNDUP

From RFE/RL's News Desk:

EUROPE PRAISES GAS DEAL, PRESSES RUSSIA ON REBEL VOTES

By RFE/RL

European leaders have welcomed a deal under which Russia is to restore natural-gas supplies to Ukraine but told Vladimir Putin that elections held by pro-Russian separatists in eastern Ukraine on November 2 will be illegitimate.

Russian President Putin, Ukrainian President Petro Poroshenko, German Chancellor Angela Merkel, and French President Francois Hollande spoke in a four-way telephone conversation overnight after Ukraine and Russia sealed a deal meant to guarantee Russian gas supplies to Ukraine through March 2015.

All four leaders welcomed the gas deal signed late on October 30 in Brussels, a German government spokesperson said, and a Kremlin statement called the agreement "an important step in the context of the future provision of uninterrupted transit of gas to Europe."

But a statement from Poroshenko's office said "Ukraine, Germany and France expressed (the) clear common position that they would not recognize the elections planned by separatists."

It said the elections on rebel-held territory in eastern Ukraine's Donetsk and Luhansk regions would contradict an agreement reached in Minsk on September 5 and aimed to end the conflict between Kyiv and the pro-Russian rebels, which has killed more than 3,700 people since April and poisoned East-West ties.

It said Poroshenko, Merkel, and Hollande "urged Russia not to recognize those elections as well."

Merkel's spokesman, Georg Streiter, said that "Merkel and Hollande underlined that there can only be a ballot in line with Ukrainian law."

He said the votes would violate the Minsk agreement and further complicate efforts to find a solution to the crisis in eastern Ukraine.

"The German government will not recognize these illegitimate elections," Streiter told a news conference, adding that European leaders were united on this issue and had agreed on this at a summit last week in Brussels.

Moscow has made no formal recognition of the "people's republics" the separatists have proclaimed in Donetsk and Luhansk, and the Kremlin denies involvement in the conflict despite what Kyiv and NATO say is clear evidence that Russia has sent troops and weapons into Ukraine to help the separatists.

But in comments published on October 28, Russian Foreign Minister Sergei Lavrov said Moscow would "of course recognize the results" of the separatists' elections.

The Kremlin statement about the telephone conversation made no mention of the elections.

It also said the leaders reaffirmed their commitment to the implementation the September 5 agreement, and underscored the need to observe the cease-fire that was central to the Minsk deal.

The Kremlin said Russia believes the "the establishment of a steady dialogue" between Kyiv and the separatists would "undoubtedly" help stabilize the situation.

Kremlin critics say Russia supported the September 5 agreement because it followed rebel gains that left the separatists in control over large portions of Donetsk and Luhansk, potentially giving Moscow a lever of influence on Ukraine for years to come.

The November 2 balloting in the rebel-held regions comes a week after those areas stayed out of voting in in Ukraine's parliamentary election on October 26, in which pro-Western parties won a sweeping victory.

Poroshenko proposed on October 31 that Arseniy Yatsenyuk stay on as prime minister.

"I have proposed that the Petro Poroshenko Bloc put forward Arseniy Yatsenyuk to the post of prime minister," Poroshenko wrote on Twitter.

Yatsenyuk's People's Front party narrowly beat out the Petro Poroshenko Bloc in voting by party in the October 26 election, according to a nearly complete count.

But Poroshenko's bloc fared better in first-past-the-post voting and was positioned to take more parliament seats than the People's Front, according to election commission data.

Yatsenyuk is a vocal critic of Russia and is popular among Western governments for his support for economic reforms.

He is a target of criticism from Russian officials who say the  government that came to power in Ukraine after former president Viktor Yanukovych fled in February in the face of protests seized control in an illegal coup d'etat supported by the West.

Russia annexed the Crimea region from Ukraine in March, adding to tension that increased still further when the conflict in eastern Ukraine erupted the following month.

The hard-fought gas deal provided what European Energy Commissioner Guenther Oettinger called "perhaps the first glimmer of a relaxation" between Ukraine and Russia.

Russia had raised the price it was asking Kyiv pay for gas after Yanukovych's ouster and then stopped supplying gas to Ukraine in June, citing what it said was $5.3 billion in debt and demanding advance payment for any future supplies.

Oettinger said that under the accord, Ukraine will pay Russia $1.45 billion in gas arrears within "days" for Moscow to resume gas deliveries.

He said Russia will then "immediately" lower Ukraine's gas price by 100 dollars per 1,000 cubic meters.

Yatsenyuk, in figures later confirmed by Moscow, said Ukraine would pay $378 per 1,000 cubic meters until the end of 2014 and $365 in the first quarter of 2015.

Kyiv will subsequently have access to Russian gas deliveries in exchange for pre-payment, according to Oettinger.

He said Ukraine also agreed to settle another $1.65 billion in arrears by the end of the year.

The deal is expected to include EU funding to help Ukraine pay.

Oettinger said, "we can guarantee a security of supply over the winter," not only for Ukraine but also for the EU nations closest to the region.

Ukraine normally relies on Russia for about the half the gas it uses, and the onset of winter made the need for a deal more urgent.

Russia also provides about one-third of the gas consumed in the European Union, with about half of that pumped via Ukraine.

The EU was seeking to avoid a repeat of 2006 and 2009, when Russia halted supplies to Ukraine amid price disputes, disrupting deliveries to Europe during two cold winters.

News of the agreement appeared to bring relief in Europe, with British wholesale gas prices for November and December falling to their lowest ever levels on October 31.

(With reporting by Reuters, AP, and AFP)

RUSSIA EXTENDS DETENTION OF ESTONIAN POLICE OFFICER

A Moscow court has extended by two months the detention of an Estonian police officer charged with espionage.

Lefortovo Court spokesperson Yulia Sotnikova said on October 31 that a judge had "granted a request from investigators to prolong the period of detention until January 5" of Eston Kohver.

Kohver was detained on September 5 on espionage charges.

Moscow claims Kohver was seized inside Russia, while Estonian officials say he was captured at gunpoint in Estonia near the border.

The case has strained relations between Russia and Estonia.

The European Union and United States have called for the immediate release of the Estonian security official.

(Based on reporting by Interfax and TASS)

EU FILES WTO TRADE COMPLAINT AGAINST RUSSIA

The European Union has launched a complaint with the World Trade Organization (WTO) over Russian import duties on some European agricultural and manufactured goods.

The Geneva-based international arbitration body said on October 31 that the EU accuses Russia of levying tariffs on several types of goods that are above the legally binding tariff ceilings that Moscow has agreed to within the WTO mechanism.

Those goods include paper and paperboard, palm oil, and refrigerators.

Under WTO rules, the parties have 60 days to work out a mutually agreed solution. After that, the EU could ask the WTO to adjudicate.

The dispute is the fifth involving Russia and the EU at the WTO.

The European Commission's spokesman for trade issues, Wojtek Talko, said the case was not a complaint against the recent ban on Russian food imports from Europe.

(Based on reporting by Reuters and dpa)

RUSSIAN CENTRAL BANK RAISES INTEREST RATES

The Russian central bank said it would raise interest rates from 8 percent to 9.5 percent as Western sanctions and falling oil prices have sent the Russian ruble plummeting.

The Bank of Russia's board of directors made the decision to raise interest rates at an October 31 meeting.

The central bank had increased the rate to 8 percent in late July, following increased to 5.5 percent in March and 7.5 percent in April.

The United States, European Union and other nations have imposed successive rounds of sanctions on Russia over its role in the Ukraine crisis.

Russia annexed the Crimea region from Ukraine in March, and Kyiv and NATO accuse Moscow of aiding pro-Russian separatists with troops and arms during a conflict in eastern Ukraine that has killed more than 3,700 people in eastern Ukraine since April.

(Based on reporting by TASS, Interfax, and AFP)

U.S AMBASSADOR TO KYRGYZSTAN WARNS OF RUSSIAN INFLUENCE

By RFE/RL

The U.S. Ambassador to Kyrgyzstan says that the Central Asian nation's "growing partnership with Russia" presents a challenge to U.S. efforts to support democracy in Kyrgyzstan.

In an article published on the website of the Council of American Ambassadors, Pamela Spratlen (eds: a woman) said the "strong partnership" that Kyrgyz President Almazbek Atambaev has forged with Russian President Vladimir Putin "has had its impact on our efforts."

"It remains an unanswered question how Kyrgyzstan can maintain its democratic trajectory while pursuing this partnership," she said.

Spratlen also said that many in Kyrgyzstan get their news from Russian media, and that in the case of the Ukraine crisis "the strident anti-American tone taken by Russian propaganda has crystallized local public opinion around Moscow's narrative of events there."

Kyrgyzstan has seemed to follow Moscow's lead on several issues recently, including drafting laws that legitimize discrimination against homosexuals and would require foreign-based organizations to register as "foreign agents."

(Based on Spratlen article: https://www.americanambassadors.org/publications/ambassadors-review/fall-2014/democracy-in-central-asia-supporting-kyrgyzstan-s-island-of-democracy)

RUSSIAN ACTOR FIRES MACHINE GUN IN DONETSK

Ukrainian authorities have filed charges and Russia's Union of Journalists is demanding an apology after a prominent Russian actor was filmed firing a machine gun near the Donetsk airport while wearing patches that identified him as a member of the press.

Ukraine's Interior Ministry on October 31 filed criminal charges against Mikhail Porechenkov for the pictures taken with pro-Russian separatists in eastern Ukraine.

Interior Minister Arsen Avakov said on his Facebook page, "Mikhail Porechenkov, present in Donetsk, personally took part in firing on units of Ukraine's armed forces using an automatic weapon."

Pavel Gutiontov of Russia's Union of Journalists called the incident "irresponsible behavior on the part of the actor" and demanded an apology.

Porechenkov said that it was a staged scene, that he was firing blanks, and that the only bullet-resistant vest and helmet he could find were labelled "press."

(Based on reporting by UNIAN, TASS, and Interfax)

09:54 October 31, 2014

50 RUBLES TO THE DOLLAR?!?

Writing in Slon, Yakov Mirkin, chairman of the Department of International Capital Markets at the Russian Academy of Sciences Insititute of World Economy and International Relations, argued that the ruble could easily sink to 50 to the dollar.

The reasons? 

1) The ruble is overvalued anyway;

2) The dollar is rising against major currencies and this upward cycle is likely to continue;

3) Oil prices are falling;

4) A combination of Western sanctions and diversification of energy supplies

5) Capital flight from Russia continues apace.

And in light of Mirkin's argument, it is worth noting that he has consistently been arguing that the ruble is overvalued. Here he is speaking back in August 2013:

09:41 October 31, 2014

UKRAINIAN HOSPITALITY

Russian journalist Ivan Sukhov writing in "The Moscow Times" on working in Ukraine:

"Russian journalists encounter no personal aggression while working in Ukraine. Only the rare local politician refuses to speak to Russian reporters.

And in place of perfectly understandable aggression, Russian journalists encounter only gentle Ukrainian hospitality along with a sizable share of condescending sympathy.

It is as if they want to tell us, 'We will stay here, where we have taken the responsibility for our future into our own hands, whereas you will fly home to Russia's stifling political atmosphere, to a country that futilely reconsiders the outcome of the Cold War and the people are caught up in a mass euphoria over the bloodshed in the Donbass.'"

Read it all here.

08:56 October 31, 2014

MORNING NEWS ROUNDUP

From RFE/RL's News Desk:

RUSSIA, UKRAINE SIGN EU-BROKERED GAS DEAL

By RFE/RL

Moscow and Kyiv have signed a landmark agreement that will guarantee Russian gas deliveries to Ukraine throughout the winter despite tense relations over the fighting in eastern Ukraine.

The EU-brokered deal, which extends until March 2015, was signed at a ceremony in Brussels by the energy ministers of the two countries, Aleksandr Novak and Yuriy Prodan, and European Energy Commissioner Guenther Oettinger.

Outgoing EU Commission President Jose Manuel Barroso, who oversaw the signing, hailed the agreement, saying, "There is now no reason for people in Europe to stay cold this winter."

The hard-fought deal followed months-long EU-mediated negotiations between Moscow and Kyiv amid a long and bitter dispute over payments.

The agreement was reached after two days of marathon talks that had stalled before dawn on October 30 when Russia demanded that the EU first agree with Ukraine how to pay Kyiv's outstanding bills and finance gas deliveries through to March.

Oettinger said that under the accord, Ukraine will pay Russia $1.45 billion in gas arrears within "days" for Moscow to resume gas deliveries.

He said Russia will then "immediately" lower Ukraine's gas price by 100 dollars to around $385 per 1,000 cubic meters.

Kyiv will subsequently have access to Russian gas deliveries in exchange for pre-payment, according to Oettinger. He said Ukraine also agreed to settle another $1.65 billion in arrears by the end of the year.

The deal is expected to include EU funding to help Ukraine pay off its debts to Russia's state-owned gas giant Gazprom.

Oettinger said, "we can guarantee a security of supply over the winter," not only for Ukraine but also for the EU nations closest to the region.

He added that the deal "is perhaps the first glimmer of a relaxation" between Ukraine and Russia.

Ukraine's Prodan said the "decisions taken today will provide energy security for Ukraine and the EU."

Moscow cut off gas deliveries to Ukraine in mid-June, citing a $5.3-billion debt and demanding that Ukraine settle its outstanding bills and pay up front for any future deliveries.

The dispute occurred amid Russia's conflict with Ukraine and Western sanctions imposed on Moscow for its annexation of Crimea in March and its subseqent military and political support for pro-Russian separatists in eastern Ukraine.

With Ukraine relying on Russia for around 50 percent of its gas, the onset of winter made the need for a deal more urgent.

Russia also provides about one-third of the European Union's gas, about half of which is pumped via Ukraine.

The EU was seeking to avoid a repeat of 2006 and 2009 when Russia halted supplies to Ukraine, disrupting deliveries to Europe during two very cold winters.

But Russia's Novak said after the signing that Moscow will remain a "reliable supplier" of energy to Europe and the deal struck with Ukraine will ensure stable gas deliveries over the winter.

In reaction to the deal, the French and German leaders said in a joint statement that the EU will "fully play its role" to implement the gas deal.

Francois Hollande and Angela Merkel said they had spoken with Russian President Vladimir Putin and his Ukrainian counterpart Petro Poroshenko earlier October 30, and all four "have welcomed the conclusion of negotiations on the delivery of Russian gas to Ukraine, achieved thanks to the mediation of the European Union."

(Based on live broadcast, with additional reporting by Reuters, AP, and AFP)

AIR ARMENIA BLAMES RUSSIA FOR FLIGHT SUSPENSIONS

By RFE/RL’s Armenian Service

YEREVAN -- Air Armenia, a passengar and cargo airline based in Yerevan, has suspended all passenger flights until at least December 20 over financial difficulties that the firm is blaming on Russia.

Air Armenia says it is unable continue regular passenger services because of a “panic” among investors and customers over a statement by Russia's federal air navigation service.

Russia's Rosaeronavigatsia announced on September 11 that it would ban Air Armenia from operating flights to Russian cities unless the company paid its outstanding debts by September 21.

Air Armenia said ihe statement damaged its business reputation and that, as a result, its fleet was reduced to one aircraft.

Other than Russian cities, the airline had been flying to Paris, Frankfurt, and Athens.

Air Armenia was founded as a cargo airline in 2003 and began operating commercial passenger flights in 2013 after the bankruptcy of Armavia.

COURT ORDERS NATIONALIZATION OF OLIGARCH'S BASHNEFT SHARES

A Moscow court has ordered the nationalization of a stake in an oil company owned by a detained tycoon.

The Moscow Arbitration Court ruled on October 30 the stake in Bashneft held by billionaire Vladimir Yevtushenkov's holding company Sistema would be returned to the state.

Prosecutors claimed the stake was illegally privatized by officials in Russia's Bashkortostan region.

The court said new claims could be filed after the worth of Sistema's stake in Bashneft was ascertained.

Yevtushenkov was arrested last month on charges of money laundering related to the acquisition of Bashneft.

His arrested sparked speculation that Russia's largest oil company, state-run Rosneft, would acquire Sistema's Bashneft shares.

Yevtushenkov is one of Russia's richest businessmen, with assets estimated to be worth some $9 billion.

(Based on reporting by AFP, rapsinews.ru, and Interfax)

LATVIA-BASED RUSSIAN NEWS PORTAL BLOCKED IN KAZAKHSTAN

By RFE/RL's Kazakh Service

An online Russian news portal based in Latvia has been blocked in Kazakhstan over an article described by Astana as "inflicting ethnic discord."

Kazakhstan's Ministry of Investments and Development said on October 30 that the Meduza.io website published an article "propagating ethnic discord and threatening the territorial integrity" of Kazakhstan.

The article about ethnic Russians living in Kazakhstan's eastern city of Ust-Kamenogorsk (aka Oskemen) is titled: "Ust-Kamenogorsk People's Republic. Are Locals Ready For Polite Green Men?"

‘Green Men’ refers to the deployment in foreign countries of Russian military forces wearing unmarked green uniforms – as Russia has done in the past in regions of Georgia and Ukraine.

The ministry also has filed a lawsuit against Meduza.io in connection with the article.

It says the website will remain blocked in Kazakhstan until a local court rules in the case.

(With reporting by Interfax)

KYRGYZ WILL NEED PASSPORTS TO ENTER RUSSIA

By RFE/RL's Kyrgyz Service

Kyrgyzstan's State Registration Ministry says that as of January 1, 2015, Kyrgyz citizens will no longer be able to enter the Russian Federation using their national identification documents.

Since 2007, Kyrgyz labor migrants have been travelling between the two countries with internal identification documents. Now they will have to obtain travel passports.

The regulation, announced on October 29, will affect hundreds of thousands of Kyrgyz labor migrants who work in Russia and periodically travel between the two countries.

Moscow announced earlier this year that it wants to tighten by 2015 the regulations for entering Russia by nationals of former Soviet republics that are not members of the Russia-led Customs Union and Eurasian Economic Union.

In May, Kyrgyzstan signed a road map under which it is to join the Customs Union, which currently comprises Russia, Belarus, and Kazakhstan, by the end of 2014.  

NATO REPORTS UNUSUAL RUSSIAN WARPLANE ACTIVITY AROUND EUROPE

NATO said on October 29 that it tracked and intercepted four groups of Russian warplanes “conducting significant military manoeuvers” in international airspace close to the borders of the European Union during the previous 24 hours.

NATO’s SHAPE military headquarters in Mons, Belgium said: “These sizeable Russian flights represent an unusual level of air activity over European airspace.”

It said the planes included strategic bombers, fighters, and tanker aircraft.

They were detected over the Baltic Sea, the North Sea, the Atlantic Ocean, and the Black Sea on October 28 and 29.

Russian bombers flew south all the way to international airspace west of Portugal and Spain.

Norwegian, British, Portuguese, German, Danish, and Turkish fighters were scrambled to intercept and identify the Russian planes.

Planes from the non-NATO nations of Finland and Sweden also responded.

Since Russia’s intervention in Ukraine, tensions between NATO and Russia have risen to the highest level since the Cold War.

(Based on reporting by AP and AFP)

18:33 October 29, 2014

EVENING NEWS ROUNDUP

From RFE/RL's News Desk:

KREMLIN MOVES TO QUASH PUTIN HEALTH RUMORS

Vladimir Putin's spokesman said on October 29 that the Russian president is in good health, seeking to quash rumors of an illness.

Dmitry Peskov told reporters in Moscow that "everything is okay" with Putin's health, Russian news agencies Interfax and TASS reported.

"They will wait in vain. May their tongues wither," Peskov said of those who claim Putin is ill.

Peskov spoke after a spate of Russian media reports referring to an October 24 column in the tabloid "New York Post" whose author, Richard Johnson, cited unidentified sources as saying Putin had pancreatic cancer.

Putin and the Kremlin have strongly discouraged reporting about the 62-year-old president's private life.

(Based on reporting by TASS and Interfax)

ROSNEFT THREATENS TO SUE NEWSPAPER OVER SANCTIONS REPORT

Russia's largest oil company, Rosneft, is threatening to sue the Russian daily "Kommersant" for a report alleging Rosneft sent President Vladimir Putin proposals for countersanctions against Western companies and individuals.

"Kommersant" reported on October 29 that state-run Rosneft's proposals include limiting cooperation aboard the International Space Station, prohibiting burial of U.S. and EU nuclear waste in Russia, and possible confiscation of property in Russia owned by Western countries or their citizens.

Putin's spokesman, Dmitry Peskov, denied there were any Rosneft proposals for sanctions, but presidential aide Andrei Belousov and Economy Minister Aleksei Ulyukayev seemed to contradict this.

State-run TASS reported Peskov said reports Rosneft had sent such proposals were untrue.

Peskov said decisions on imposing sanctions were made "in line with the relevant departments, and taken on the level of the government and president."

A different TASS report quoted Belousov as saying, "We are closely studying Rosneft's proposals."

Belousov went on to say, "I would say the radicalism of the proposals for now exceeds the current level of tensions."

The Interfax news agency quoted Ulyukayev as saying the proposals were a "very complex document" and adding, "I don’t think it is grounds for making any decisions."

The "Kommersant" report said "Russian government officials" had provided information about the alleged proposals.

A statement from Rosneft said the company was "deeply shocked" by the "Kommersant" article and might sue the newspaper.

Western governments have imposed several rounds of sanctions on Russia over its annexation of Crimea and support for separatists in eastern Ukraine.

The sanctions target key Russian industries and individuals close to Putin, including Rosneft and its head, Igor Sechin, who is a former Kremlin deputy chief of staff.

The sanctions have hurt Rosneft, which has already requested additional funding from the Russian government to make up for losses incurred due to sanctions.

British oil company BP reported on October 28 that its income from its operations with Rosneft dropped from $808 million in the third quarter of 2013 to $110 million in the same period this year.

(Based on reporting by TASS, Interfax, Reuters, and Kommersant)

WHITE HOUSE DETECTS SUSPICIOUS CYBER ACTIVITY, REPORT BLAMES RUSSIA

The White House says it has taken measures to counter suspicious activity detected on its unclassified computer network.

A White House official would not say who might have been responsible for the activity on what was described as an unclassified computer network used by employees of the Executive Office of the President.

The official, who spoke on condition of anonymity, said the authorities had taken "immediate measures to evaluate and mitigate the activity."

In a report on October 28, the "Washington Post" cited sources as saying hackers believed to be working for the Russian government breached the unclassified computer network in recent weeks.

The White House has declined to comment on the "Washington Post" report.

A U.S. administration official said there were no indications that classified networks had been affected.

(Based on reporting by Reuters, AP, and dpa)

VICTIMS OF STALIN TERROR REMEMBERED IN MOSCOW CEREMONY

By RFE/RL

Activists are gathering near the former KGB headquarters to honor the memory of thousands of men and women executed by Soviet authorities during Josef Stalin's "Great Terror."

Speakers at the daylong ceremony at the Solovetsky Stone memorial on Moscow's Lubyanka Square read out aloud the names, ages, occupations, and dates of executions of some 30,000 people killed by Soviet authorities in 1937-1938.

Muscovites and others brought flowers, pictures of victims and candles to the site of the "Returning the Names" commemoration, which began at 1000 (local time; 0800 Prague time) and was to end at 1000 (local time; 0800 Prague time).

The annual ceremony is organized by Memorial, Russia's oldest and best-known human rights organization, which is under pressure from the government.

On October 10, Russia's Justice Ministry appealed to the Supreme Court to close Memorial.

Memorial has held the ceremony every year since 2006 at the site near the headquarters of the Federal Security Service, the KGB's main successor.

Ceremonies were also being held in other Russian cities.

(Based on live broadcast by october29.ru)

SEPARATISTS SHELL UKRAINIAN TROOPS

Pro-Russian separatists reportedly shelled the position of Ukrainian government troops in southeastern Ukraine on October 29, despite an almost two-month-old cease-fire agreement.

Authorities in the port city of Mariupol say military positions located near the village of Talakovka were targeted on October 29 by conventional artillery and Grad rockets that were fired from from the separatist-controlled region of Donetsk.

Casualties were reported among troops.

The cease-fire agreement signed in early September ended most fighting between the two sides -- although battles at the Donetsk airport, in Mariupol, and in villages near the city of Luhansk continue on an almost daily basis.

The UN says more than 3,700 people have been killed in six months of fighting between government forces and separatists in eastern Ukraine, with hundreds of thousands fleeing their homes.

(Based on reporting by Interfax and UNIAN)

RUSSIAN AIRLINE PLANS YEREVAN-CRIMEA FLIGHTS OVER kYIV'S OBJECTIONS

By RFE/RL's Armenian Service

The Grozny Air civil aviation company, based in the Russia's Chechnya region, is pressing ahead with plans to launch regular flights from Yerevan to Crimea, despite protests from Kyiv.

Timur Shimayev, an executive officer for Grozny Air, told RFE/RL on October 29 that the firm's inaugural flight to Crimea is scheduled for November 17.

But Ukraine's Ambassador to Armenia, Ivan Kukhta, told reporters in Yerevan on October 29 that any commercial flights between Yerevan and Crimea must first be approved by Kyiv.

Kukhta's statement came five days after a spokesman for the Armenian government’s Civil Aviation Department, Ruben Grdzelian, said that a Russian regional airline had not been allowed to launch flights between Armenia and Crimea since the Ukrainian penninsula was annexed by Russia in March.

Moscow's annexation of Crimea has been condemned as illegal by the United States, the European Union, and the United Nations General Assembly.

 

12:55 October 29, 2014

SANCTION THIS!

The Russian daily "Kommersant" reports that the state-run oil giant Rosneft is calling on President Vladimir Putin to impose new sanctions on the West. The new moves reportedly include limiting cooperation aboard the International Space Station, prohibiting burial of U.S. and EU nuclear waste in Russia, and possible confiscation of property in Russia owned by Western countries or their citizens.

12:41 October 29, 2014

AND IN THE FALLOUT DEPARTMENT...

Just a few things I've noticed this morning:

Russian-German Trade Down

German exports to Russia have dropped by more than a quarter, "The Moscow Times" reports. In August, exports from Germany to Russia were 2.3 billion euros, a 26.3 percent decrease from a year ago. Moreover, German exports to Russia fell by 16.6 percent from January-August 2014.

Russian Elite More Cohesive -- For Now

According to a report by Reuters, sanctions have had the "opposite effect to the one intended" among the elite. "Far from dividing those closest to President Vladimir Putin, they have forced the main players in the energy sector to rally behind him. This circle has by necessity become more focused, Western and Russian businessmen, diplomats and politicians said," according to the report.

Sweden Is Warming Up To NATO

Foreign Directors Bail On Russian Firms

Since the start of the year, 14 percent of foreigners serving on the boards of Russian firms have left their posts, "The Moscow Times" reports. "Western sanctions have forced some foreign directors to step down or curb their activities on the boards of publicly traded Russian companies, leaving a critical gap that few domestic candidates are equipped to fill," according to the report.

09:17 October 29, 2014

MORNING NEWS ROUNDUP

From RFE/RL's News Desk:

RUSSIA AND UKRAINE TO RESUME GAS TALKS

Russia and Ukraine are set to resume talks over a gas dispute on October 29 in Brussels.

The new round of negotiations comes after inconclusive talks October 21, when European Energy Commissioner Guenther Oettinger announced some progress, but said a final deal has yet to be agreed.

Russia cut off gas deliveries to Ukraine in mid-June, citing a $5.3-billion debt.

Oettinger said that, as part of tentative deals, Ukraine planned to purchase some 4 billion cubic meters of Russian gas before the end of this year.

Russia on October 21 said the it would sell gas to Ukraine for $385 per 1,000 cubic meters, much lower than the $485 that Russia's state-controlled Gazprom was demanding just weeks ago.

Moscow said that price would be in force from October 2014 until late March 2015 -- but only if Ukraine pays in advance.

(Based on reporting by AFP and AP)

KYIV CONDEMNS MOSCOW'S SUPPORT FOR SEPARATIST ELECTIONS

Ukraine on October 28 condemned as “destructive and provocative” Russia’s support for elections organized by pro-Russian separatists in eastern Ukraine, while the United States said a vote by separatists in eastern Ukraine would be unlawful.

The November 2 vote was scheduled by rebels in defiance of Ukrainian national elections on October 26, which were won by pro-Western parties.

Ukrainian President Petro Poroshenko on October 28 described the vote planned by rebels as "pseudo-elections," saying they "grossly contradict the spirit and letter" of international agreements reached in Minsk in September.

Russian Foreign Minister Sergei Lavrov says Moscow plans to recognize the elections that are being organized by separatists in the Donetsk and Luhansk regions of Ukraine.

Meanwhile, U.S. Secretary of State John Kerry warned that the the vote "will be a clear violation of the commitments made by both Russia and the separatists that it backs in the Minsk agreements."

(Based on reporting by Reuters, AP, AFP, and TASS)

GAZPROM NEFT CHALLENGES EU SANCTIONS IN EUROPEAN COURT

Gazprom Neft, the oil arm of Russia's state-controlled natural gas monopoly Gazprom, said on October 28 that it has challenged European Union sanctions against the firm in the EU’s Court of Justice.

The sanctions against Gazprom Neft were imposed as part of wider restrictions against Russia over its illegal annexation of Crimea from Ukraine and its support for pro-Russian separatists in eastern Ukraine.

The EU sanctions restrict the ability of Gazprom Neft, Russia's fourth biggest oil producer by output, to raise funds on European markets.

The United States also has imposed sanctions against Gazprom Neft in response to Russia’s role in Ukraine’s crisis.

The West says Moscow is supplying arms and troops to help pro-Russian separatists in eastern Ukraine battle Ukrainian government forces.

Moscow denies that, despite increasing evidence to support the charges.

(Based on reporting by Reuters, AP, and TASS)

18:54 October 27, 2014

THE BIG CHILL

Sam Greene, Director of the Russia Institute at King’s College London and author of "Moscow in Movement: Power & Opposition in Putin’s Russia," has a depressing (and must-read) blog post up about his recent trip to Moscow titled: "Russia's Tomorrow, Today."

It opens like this:

The news and the invitation were waiting for me, both, when I got off the plane from London to Moscow. I saw the invitation first—from a long-time colleague, to attend a workshop on the future of Russian politics later this month at Memorial, the venerable Russian historical society and human rights organization. I saw the news two hours later: 17 days after that workshop, Russia’s High Court will hold a hearing on the government’s demand that Memorial be liquidated.

That is the condition of life in Russia these days: two hours in which an invitation takes on a funerary pallor, 17 days in which the world becomes immeasurably smaller. Rarely has the distance between today and tomorrow been so great and so fraught as it is now.

And it concludes like this:

The tomorrow whose arrival now seems inevitable is one in which the archives of Memorial and the Sakharov Center disappear, to be replaced with a single national history textbook and a single national literature textbook, so that the past may have no bearing on the future. It is one in which policy analysis disappears from the public space, along with honest reporting, so that the present may also have no bearing on the future. Tomorrow, when it arrives, will bring one sole purpose: to preserve and protect the status quo. It is a tomorrow after which there are meant to be, politically speaking, no more tomorrows at all..

What the designers of this new tomorrow may not realize, however, is that, once freed from the paralysis of a pointless today, the despair of disaffection becomes the desperation of dissent. Dissidents, pitted against a regime that can never fall, take risks that are unnecessary in a more fluid system. They speak at all costs to demonstrate that they have no voice, and they go to jail to demonstrate that they are not free. Once today becomes tomorrow, and there are no more tomorrows for which to wait, the imperative of immediate action reemerges. 

Is the Kremlin ready for an opposition that, because everything is already lost, has nothing left to lose?

Read it all here.

And a h/t to Ben Judah for flagging.

 

15:42 October 27, 2014

FROM THE YOU-CAN'T-MAKE-THIS-STUFF-UP DEPARTMENT

The Russian health and consumer watchdog Rospotrebnadzor has issued a dire warning: SEFIES CAUSE HEAD LICE!

No, really. I'm serious! It is actually on their official website:

"One reason for the spread of lice among teenagers, in the opinion of experts, is because selfie photographs have become more common. In these group photos, lice are transfered due to the touching of heads."

And it is causing a lot of laughs on the Twitter:

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The Power Vertical is a blog written especially for Russia wonks and obsessive Kremlin watchers by Brian Whitmore. It covers emerging and developing trends in Russian politics, shining a spotlight on the high-stakes power struggles, machinations, and clashing interests that shape Kremlin policy today. Check out The Power Vertical Facebook page or