MOSCOW, July 26 (RIA Novosti) Russian Security Council's powers expanded/Russia ready to invest heavily in Abkhazia/Glonass to rival GPS satellite system/IMF calls Russia a powerhouse of world economic growth/U.S. tightens sanctions against companies dealing with Iran
Gazeta
Russian Security Council's powers expanded
On Wednesday, President Vladimir Putin chaired an augmented meeting of the country's Security Council that discussed the national information policy strategy. The paper's sources said the Kremlin has started drafting the new Security Council statute.
A source said the Security Council's powers would be considerably expanded, and that it would oversee security agencies and chart national political strategies.
Experts said President Putin was likely to become Security Council secretary after resigning in 2008, and would therefore remain in control.
Pro-Kremlin political analysts also said the Security Council would turn into another government.
Political analyst Sergei Markov said the Security Council's role tended to diminish in conditions of stability, and become strengthened during transitional periods.
He said during the 2007-2008 transitional period the Council would once again act as a parallel supervisory government, and would help implement the national leader's political line.
Political scientist Vladimir Zharikhin said the government and parliament oversee economic and legislative aspects, but there is no one to deal with Politburo-style functions relating to political-strategic issues.
Leonid Ivashov, vice president of the Academy of Geo-Political Affairs, said changes were long overdue, and the Security Council should become a General Headquarters of the Commander-in-Chief, rather than the General Staff.
The Security Council meeting also said 75% of Russian families would have high-bandwidth Internet access by 2015.
But it is rather disturbing that the Security Council, a secretive agency more concerned with state security than with human rights and freedoms, is charting the development strategy of the information society, whose information flows are not controlled.
It appears that government officials could regulate cyberspace issues. First Deputy Prime Minister Sergei Ivanov, a likely candidate to succeed President Putin, said the state must be ready to seize the initiative from foreign microchip and electronic-component producers, and must also prevent possible cyber-terrorist attacks.
Nezavisimaya Gazeta
Russia ready to invest heavily in Abkhazia
Russia's victory in a tender to host the 2014 Winter Olympic Games in the Russian resort city of Sochi provided neighboring Abkhazia (the breakaway Georgian republic) a number of opportunities.
Deputy Prime Minister Alexander Zhukov said Abkhazia would supply construction materials for Sochi.
Abkhaz Foreign Minister Sergei Shamba told the paper that new cement and brick as well as gravel production facilities would be built to meet the needs of the Olympic construction complex.
However, Russia may pay dearly for Abkhazia's triumph - it would further worsen its tense relations with Georgia and threaten new problems with its admission to the World Trade Organization (WTO).
Nino Kadzhaya, spokeswoman for the Georgian Foreign Ministry, told the paper that the ministry had so far refrained from commenting on the statement by the Russian deputy prime minister.
Konstantin Gabashvili, chairman of the Georgian parliament's foreign relations committee, said: "I would call on our Russian colleagues not to use preparations for the Sochi Olympics as a pretext to aggravate Russian-Georgian relations.
"All actions should be agreed on with the government of Georgia, whose territorial integrity Russia acknowledges. Investments in Abkhazia that have not been discussed with the Georgian leadership are considered an overt political reason for inflaming the conflict, and are harmful to Russian-Georgian relations."
Paata Davitaya, the leader of the We Ourselves political movement, said: "The decision by the Russian government to invest in the construction of a cement factory in Abkhazia blatantly violates a number of international agreements."
He referred, in particular, to an agreement signed by CIS heads of state that stipulates economic sanctions on Abkhazia.
"There is one more problem here - which tax service will audit the spending of the fair funds. Abkhazia's, which is de jure illegal; Russia's, for which it is beyond its jurisdiction; or Georgia's, which is unable to control the situation in the breakaway Abkhazia?" Davitaya said.
Alexei Malashenko from the Moscow Carnegie Center told the paper: "We are giving one more reason to Georgia to doubt Russia's entry to the WTO."
Rossiiskaya Gazeta
Glonass to rival GPS satellite system
On Wednesday, First Deputy Prime Minister Sergei Ivanov told the government's defense industry commission that the Cabinet would soon draft and approve a target federal program for developing and operating the Global Navigation Satellite System (Glonass) until 2020.
He said an advanced global satellite navigation system was a key political and economic factor on a par with nuclear arsenals and strategic fuel-and-energy reserves.
In early June, the Glonass cluster increased to 12 satellites providing coordinates with an accuracy of a few dozen meters. Six more satellites are scheduled to be launched before the year's end.
Yury Nosenko, deputy director of the Russian Space Agency, said Glonass would have one-meter accuracy, like the U.S. Global Positioning System (GPS), by 2011, after Glonass-M satellites are replaced with the more sophisticated Glonass-K.
Experts said a possible Glonass-GPS tandem would ensure one-centimeter accuracy.
Still it is unclear whether Russia should finance the expensive Glonass cluster at a time when GPS receivers are widely available.
However, the European Union has decided to set up its own Galileo satellite navigation system because every country must have guaranteed and independent access to navigation services.
Political and other risks must also be minimized. Experts said Glonass signals could be jammed less effectively than those of GPS due to improved frequency separation.
Kommersant
IMF calls Russia a powerhouse of world economic growth
Global GDP will grow by 5.2% in 2007 and 2008, according to a revised forecast of the International Monetary Fund released Wednesday.
The rapid growth of the Chinese, Indian and Russian economies (Brazil, the fourth BRIC member, is showing slower rates) is described as a key factor for world economic development. GDP growth rates in the first half of 2007 were 11.5% for China, 7.8% for Russia, and 9.4% (according to the latest figure) for India.
This is a new trend: several years ago these economies were so small that they had practically no effect on global economic growth. In 2006, the aggregate nominal GDP of these three totaled $4.56 trillion, or 10% of the world's economic output, and 35% of the world's largest economy, the United States.
A review of forecasts for these countries is the main reason why the IMF has revised its predictions. The 2007 forecast for China has been upped from 10% to 11.2%, and for 2008 from 9.5% to 10.5%. India's economy is expected to grow 9% and 8.4% in 2007 and 2008, respectively.
The Russian economy is now expected to grow by 7% in 2007 and 6.8% in 2008 (0.6 and 0.9 percentage points more than forecasted earlier).
That is even somewhat below what most investment banks in Russia believe.
Golden Sachs has, for example, recently revised its GDP growth forecast for Russia up to 7% in 2007 and 8% in 2008. But these figures are significantly higher than the Economic Development and Trade Ministry predicts in its best-case scenario outlined in a strategy for the country's long-term development published on Wednesday (6.5% and 6.1%, respectively).
But international financial organizations, unlike Russian counterparts, are not bound by political restrictions: if their forecast is wide of the mark, their reputations will suffer, but not their jobs.
However, the IMF is also warning of growing risks. Its economists are still concerned over the situation on the U.S. real estate market, which has already made global capital more volatile and led to speculation that the U.S. economy may slow down to a recession.
But the main risk is growth in inflation not only in Russia, but also in China and the world as a whole. As a result, the world's central banks will have to tighten up their monetary and credit policies and raise interest rates, causing a slowdown in the world economy and depressing oil prices. Consequently, the same slowdown may threaten the Russian economy.
Vremya Novostei
U.S. tightens sanctions against companies dealing with Iran
On Thursday or Friday, Gazprom will quote prices for its Eurobonds planned for issue in London and New York. The amount the natural gas monopoly expects to attract is not being disclosed, but each tranche is unlikely to be less than $1 billion.
Meanwhile, information that emerged yesterday may complicate the placement. Bloomberg agency reported that leading American pension funds have sent a letter to eight oil and gas companies, including Gazprom, to inform them they might sell the shares of these companies as sanctions are tightened against Iran and groups investing in its economy.
The funds are asking how the companies plan to reduce the risks threatening the value of their stock due to a possible tightening of economic sanctions, the regional conflict, and a campaign to withdraw investments from Iran.
Currently, the Russian energy giant has only one project in Iran - the second stage of the South Pars deposit (together with Total and Petronas). The consortium helped the Iranian government to increase oil and gas condensate production from the field and is now being paid hard cash for its services. Two years ago, when U.S. Congress debated a bill on sanctions against companies collaborating with Tehran, Gazprom was exonerated of responsibility for participating in the second stage of the field's development.
Gazprom spokesmen declined to comment. Market sources close to the placement have not yet ventured to estimate the impact of the pension funds' move. In theory, one of them said, Gazprom was supposed to reveal the letter information and a possible sale of its shares and bonds to the American funds in an investment memorandum, at least among risk factors. But the draft memorandum the potential buyers received makes no mention of that.
However, Gazprom still has time to undo this lapse. A final version of the memorandum is to be signed at the same time as documents sealing the deals to place bonds. The law allows five business days for these procedures after the request book is closed and details of the placement are determined. That is to say, Gazprom's lawyers have several days for thought.
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