VLADIMIR PUTIN
ARCHIVE OF THE OFFICIAL SITE
OF THE 2008-2012 PRIME MINISTER
OF THE RUSSIAN FEDERATION
VLADIMIR PUTIN
ARCHIVE OF THE OFFICIAL SITE
OF THE 2008-2012 PRIME MINISTER
OF THE RUSSIAN FEDERATION
VLADIMIR PUTIN
Russian oil companies claim that oil export turns loss-making business. The Russian oil sector, which has long been considered the main source of Russia's prosperity and the driver of its economic growth (on a par with Vladimir Putin's policy, of course) helping Russia to rise from its knees, has been hit by the crisis. The heads of oil majors are begging for money everywhere - from its own government to China. With only three-quarters of Russian pipeline capacity being used, state-run pipeline monopoly Transneft is asking for additional funds to build new pipelines.
One day before the United Russia party congress, the top government officials in charge of the national economy discussed the future of the economic crisis and specific troubleshooting measures. New initiatives include federal guarantees for legal entities' bank deposits, revision of the federal budget in January-February 2009 in favour of the regions and increased investment allocations in excess of the projected 1.17 trillion roubles ($41.8 billion).
Legendary British composer Andrew Lloyd Webber, the author of Jesus Christ Superstar, Cats, The Phantom of the Opera, and Evita, among the world's most popular musicals, visited Mr Putin at Novo-Ogaryovo, his country residence outside Moscow.
Despite negative tendencies in the Russian economy, people trust President Dmitry Medvedev and Prime Minister Vladimir Putin more than they did a month ago.
On November 7, 2008, the Government published a plan of action to rehabilitate the financial sector and some other economic sectors. The media immediately dubbed it an "anti-crisis plan" though the document specially avoided the word "crisis". The adoption of this plan is the second stage in the efforts to improve the economy in Russia.
There is no crisis in Russia. As Prime Minister Vladimir Putin has said, "the crisis has hit the world financial system, while Russia is only experiencing its after-effects." He is right. There is no crisis in Russia. Industry in the Urals is at a standstill; the Magnitogorsk Iron and Steel Works has cut production by 70%; the Central Bank's reserves are melting away at the rate of $3 billion to $7 billion per day; Russian bonds are selling at a 20% discount - they are the least credible sovereign debt in the world today. Who said, it's a crisis? No, the word is different, it is curtains. As for a crisis, Russia has none. Here I agree with the Prime Minister.
Last week, the State Duma approved the amendments to the Constitution that extend the President's term to 6 years and the parliament's term to 5 years. We asked Gleb Pavlovsky, President of the Effective Policy Fund, to explain the thinking behind the reform.
One can offer numerous explanations for why Russia has gradually started accepting the idea of the rouble's inevitable devaluation in early November 2008. Kommersant-Vlast commentator Dmitry Butrin is trying to find out whether a weaker rouble is part of the Russian Government's tactical plan, whether this is its blunder, or both. Most importantly, no explanations can eliminate the link between the rouble's exchange rate and oil prices, the main national economic issue.
The key item on the United Russia congress agenda will be Prime Minister Vladimir Putin's report on Concept-2020; the main intrigue is whether or not he will officially become a party member and what steps would follow.
"Saakashvili knew that Putin was out to hang him by his balls," the French press wrote yesterday. The Georgian President confirmed it after he met with Nicolas Sarkozy at the Elysee Palace. When a local radio journalist read him a dialogue between the Russian and French Presidents, Saakashvili said, with a nervous grin: "I knew it, but with no gory details. That's ridiculous-but no matter." This was not the first leak of this conversation. By the looks of it, Western leaders enjoy circulating unsavoury phrases from their conversations with their Russian counterparts.
Yesterday, the State Duma passed the first reading of President Dmitry Medvedev's amendments to the Constitution, which extend the presidential term to six years and the term of the State Duma, lower parliament chamber, to five years. Only the Russian Communist Party (KPRF) voted categorically against the amendments, declaring that the strengthening of the presidency without the counterbalancing strengthening of the legislature would increase "authoritarian rule" in the country.
Yesterday, Moldova hosted a session of the Council of CIS Prime Ministers. Its participants adopted the Commonwealth's economic development strategy through 2020 and discussed the world economic crisis. Watching the CIS Prime Ministers at work, Kommersant special correspondent Vladimir Solovyov concluded that if they continue addressing economic problems as slowly as they did in Chisinau, they may fail to fulfill the strategy's objectives in time.
At yesterday's meeting, the government discussed railway reform, regional development issues, and some international cooperation issues.
At the most recent Government meeting, the ministers addressed the effectiveness of regional governments. Prime Minister Vladimir Putin indicated that last year, about 440 billion roubles of regional budgetary resources were spent ineffectively, which accounts for almost 10% of the regions' total expenditures. The cabinet will evaluate the state of affairs in the regions based on such criteria as population income growth, the state of the education and healthcare systems, and the housing and utilities sector. The better performing regions will be rewarded and the poor performers will be censured.
Dmitry Medvedev and Vladimir Putin did not refute the rumours of possible pre-term presidential elections. Answering direct questions from journalists, they have only raised new ones.
Yesterday, the Government approved a draft law on increasing pensions and other social benefits in 2009.
The CIS Heads of Government Council is meeting in Chisinau today. The event may become a turning point in the history of the Commonwealth. It is expected to adopt a long-term economic development strategy to strengthen the deteriorating alliance of the post-Soviet states. The meeting is also important because Russian Prime Minister Vladimir Putin is visiting Moldova for the first time since Chisinau refused to accept the Transdnester peace settlement sponsored by Mr Putin. Kommersant reporter Vladimir Solovyov tried to find out whether Mr Putin has "forgiven" Mr Voronin.
The planned increase of export duties on Russian round timber has been suspended at least until the autumn of 2009, Prime Minister Putin said following his meeting with Finland's prime minister. The Russian timber industry supported the decision to postpone the duty increase. The latter was intended to attract investment in the industry, however the majority of investment projects would have required credit. The suspension of the duty increase to €50 per cubic meter will mostly hurt large timber producers - prohibitively high duties helped them drive smaller competitors out of business.
The Presidium of the Peoples Democratic Union (NDS) adopted a statement yesterday declaring that during President Dmitry Medvedev's 6-month rule, "there has been no evidence of revision of the faulty political course of the previous years". Furthermore, in his address to the Federal Assembly, the President introduced measures aimed at regime strengthening and de-facto restoration of the Soviet-style single-party system, as well as initiated constitutional changes to extend presidential and Duma terms.
Experts from Russian Railways (RZD) are predicting that freight turnover in 2009 may decrease by 6%. This prognosis differs from the 3.5% GDP growth predicted by World Bank experts. The latter view is also shared by the Russian Finance Ministry.
