MOSCOW, September 28 (RIA Novosti) President Putin appoints Sochi Olympics preparation team/ Novatek buys gas assets in Egypt/ New Russia to be a land of immigrants - expert/ Business views bribes as production outlay/ Russian rightists have no political future - expert
Gazeta.ru
President Putin appoints Sochi Olympics preparation team
Prime Minister Viktor Zubkov will be the chief coordinator of the preparations for the 2014 Sochi Olympics. He has been appointed to head the reorganized presidential sports council, and will be responsible for the distribution of Olympic budget funds.
Dmitry Abzalov, an expert with the Center for Current Politics (a Russian think tank), said the Cabinet head's role would be to ensure the proper use of federal funds approved for the Olympics, something he is an expert in doing as he headed the financial monitoring agency.
The initial plan was to set up a special body to manage preparations for the Olympics. However, that idea sparked aggressive lobbying, according to Dmitry Badovsky from the Research Institute of Social Systems.
An appointment to head that body would mean a political carte blanche for the next seven years. It was to avoid unnecessary politization that the issue was finally handled as a routine personnel matter. Nevertheless, it had a few political repercussions. Badovsky believes it would certainly solidify Zubkov's position and emphasize his influence as a Cabinet head, who is here to stay, rather than an interim prime minister.
On the other hand, there is the State Olympic Corporation to be headed by Semyon Vainshtok, former Transneft chief. That had seemed a key position earlier. However, while the National Olympic Committee and the Olympic Corporation will be busy preparing for the 2014 Olympics, the presidential sports council will be supervising and coordinating their work, according to Finam analyst Vladislav Kochetkov. "On the whole, the structure is quite cumbersome. But I am not saying that its arms will be getting in the way of one another," he said.
All financial flows will be channeled through the state corporation, Abzalov said; but the presidential council will control and dispatch funds.
It is true, however, that a series of important questions remain unanswered. The Olympics law the president has talked about has not been adopted, the Olympic Corporation's status remains unclear, and its budget is still undefined, as different sources mention a range of figures between $12 billion and $30 billion.
Kommersant
Novatek buys gas assets in Egypt
Novatek, Russia's largest independent gas producer after Gazprom, has acquired a 50% working interest in the concession agreement for oil and gas exploration and development at the El-Arish offshore block in Egypt from Tharwa Petroleum S.A.E.
Tharwa Petroleum S.A.E. has retained the remaining 50%.
The Russian company will be able to survey the field for four years, with an option to prolong its exploration and drilling operations there to nine years. The concession contract stipulates a 20-year development period for each commercial discovery, and its possible extension by five years.
The area of approximately 2,300 square kilometers (about 888 square miles) is located along the Mediterranean coast and is adjacent to the northern coast of the Sinai. Half of the block lies at depths of up to 50 meters, with the remaining area reaching depths of up to 500 meters.
Mikhail Lozovoi, a Novatek spokesman, said the project's success would determine the future of the company in Egypt, and beyond Russia's borders in general.
Valery Nesterov of Troika Dialog said that El-Arish is not a major field, and the project was politically, rather than economically, profitable. He does not envisage major benefits for Novatek.
"LUKoil has been working in Egypt for a long time, yet its investment in the region remains modest," Nesterov said.
On the other hand, he said that Egypt is a dynamically developing gas market where production is growing at a fast rate. If the project proves successful, Novatek will have no problems with marketing the output. It would either sell the gas to a pipeline company or a liquefaction plant.
Natalia Milchakova, chief analyst at the Otkrytiye financial corporation, said gas could be supplied to south Europe via a gas pipeline running across Jordan.
In her opinion, Novatek's foray into the Egyptian market is a pilot project for both partners, whose results would be used to gauge the effectiveness of such cooperation.
If the project is a success, larger players could emerge on the market, such as Gazprom, which holds about 20% in Novatek, and Egyptian Natural Gas Holding Company (EGAS), the country's monopoly gas exporter. They signed a memorandum of understanding in 2005 but have not announced any projects since then.
Nezavisimaya Gazeta
New Russia to be a land of immigrants - expert
Leading economists and social scientists are warning the next president of Russia that unless the Kremlin concentrates harder on social policy, society will continue to break into isolated social and regional groups, eventually thwarting Russia's development prospects.
Social scientists are talking about the ever-aggravating fragmentation of society.
"In the past few years, we have been witnessing a disruption of the social space as well as active segregation in Russia, where dozens of isolated economic set ups have developed," said Yevgeny Gontmakher, head of the Social Policy Center at the Russian Academy of Sciences' Institute of Economics.
According to him, more than half of the country's population remain on the margin of economic development, as they are too busy surviving. Super-projects like, "nanotechnologies" or the "Sukhoi SuperJet 100" sound Greek to them.
"Seven Chinese newspapers are being published in Moscow alone. The president-to-be needs to think hard about the kind of country he will be running," he warns. "The on-going demographic crisis and the problems plaguing the education system will soon transform Russia beyond recognition. It will cease to be a country of Russians, but turn into a land of immigrants like Canada."
The coming change is already manifesting itself. Social scientists have calculated that men's life expectancy in Russia's Smolensk and Tver regions has plummeted to 51 years, while effective health care is only available to 10% of the population. Similar statistical gaps are opening between different regions.
"Economic growth is concentrated in Moscow and Tyumen only, while all the other regions are close to stagnation today," said Natalia Zubarevich, regional programs director at the Independent Institute for Social Policy, a Moscow think tank.
Vedomosti
Business views bribes as production outlay
Russian businessmen now rely less on the authorities to solve their problems than seven years ago. Corruption has grown, but they view it as an unavoidable production outlay.
Andrei Yakovlev of Russia's Higher School of Economics and Timothy Frye of Columbia University asked 500 Russian companies about problems that hinder their development and about their relations with officials.
They held a similar survey in 2000.
Some things have improved. Only 57.7% of companies complained about taxes (81.7% in 2000), frequent changes in legislation, and unaffordable loans. Their concern over state interference, especially in price regulation, also decreased.
At the same time, 32.8% of the polled companies said corruption is a "serious" or "very serious" problem (25.1% in 2000). Seven years ago, corruption was a major headache for large companies, while now it is SMEs that are suffering from it the most.
Yet corruption remains in the lower half of the list of problems hindering business development. Yakovlev said: "Business has adjusted to the rules of the game."
Natalia Volchkova, a senior economist at the Center for Economic and Financial Research and Studies, which annually surveys administrative barriers, said: "Business views corruption not as a problem, but as a part of production outlay."
Since 2000, Russian companies have learned to distinguish between permissible and impermissible moves. The number of those who consider lobbying admissible went down from 69% to 59%, along with the number of companies successfully lobbying their interests with the federal and regional authorities.
According to Vladimir Salnikov of the Center of Macroeconomic Analysis and Short-Term Forecasts, lobbying in Russia is often viewed as a way to protect one's interests by means of bribing officials. "This is not good," he said, "and so the attitude to it is negative."
On the other hand, 77% of companies said they assisted officials when they were not obliged to, in particular by financing social projects, helping disabled people, war veterans, pre-school childcare centers, and hospitals, and by planting trees and shrubs. (The question was not on the list in 2000.) Over a half of them do it not because officials ask, but because other businesses are involved in such projects.
Yakovlev said 23% of companies insisted that business is not obliged to take on additional social expenses.
Vremya Novostei
Russian rightists have no political future - expert
Leonty Byzov, head of socio-political analysis at the All-Russian Public Opinion Research Center (VTsIOM), an influential pollster, said everyone, including the Kremlin, was dismayed when the Union of Right Forces (SPS) did not make it into the State Duma, the lower house of parliament, together with other political movements.
However, all attempts to establish an effective pro-Kremlin rightist movement produced no results, Byzov told the paper.
He said the SPS would not be able to overcome the 7% election threshold at the upcoming State Duma elections because only 1.5%-2% of the electorate was ready to vote for it.
He said students, rather than people aged 25-35, had become the main SPS electorate during the party's political crisis, and that only young people, not yet fully integrated into society, were ready to support a party lacking any real political prospects.
According to Byzov, the more successful older generation prefers to vote for the rather influential pro-Kremlin United Russia, a party perceived as matching their current status.
Byzov said two factors were responsible for the liberal movement's crisis. On the one hand, society is not attracted by the rightist liberal ideology. Russians bear a grudge against the ruling liberal elite of the 1990s; and liberals are supported by just 8%-10% of the electorate.
On the other hand, a liberal alliance seems impossible because of numerous ideological differences and the ambitions of separate leaders, Byzov told the paper.
He said the former democratic movement, which was dominated by liberals, had now disintegrated into numerous conflicting groups struggling for political survival, rather than for power.
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