MOSCOW, July 2 (RIA Novosti)
Russia succeeds in rocking GUAM / Putin, Medvedev to set up two-party system / Russia no longer likened to Nigeria - Putin's former adviser / State to claim half of oil export earnings / Regulator blacklists individuals and companies financing terrorism / One in five Russian companies encourages whistle-blowing
Nezavisimaya Gazeta, Kommersant
Russia succeeds in rocking GUAM
A routine meeting of GUAM, a regional association of Georgia, Ukraine, Azerbaijan and Moldova, opened in Georgia's Black Sea port city of Batumi yesterday.
Like last year's meeting in Baku, when the four countries tried to turn GUAM into a viable alternative to the CIS, this year's meeting in the capital of Adjara is unlikely to be successful. Moldovan President Vladimir Voronin has flatly refused to attend the summit.
The recent informal GUAM meeting in Kiev, Ukraine, advanced the idea of a Dispatcher Center to control the transit of the Russian natural gas to the European Union across Ukraine. Kiev also proposed controlling the volume of gas at the entry to and exit from Ukraine.
Poland and Lithuania have announced their intention to join the monitoring system. Romanian President Traian Basescu has arrived in Batumi, which points to his country's intention to participate in the project.
However, analysts say Moldova is unlikely to join it.
Viktor Nebozhenko, head of the Ukrainian Barometer sociological service, said: "Moldova will become the weak link in the already weak GUAM. The Kremlin has found a way to neutralize the organization and the international system of monitoring natural gas supplies to Europe by GUAM until the commissioning of Nabucco and Blue Stream at the least."
According to Nebozhenko, "the Kremlin is a good student, but it has not learned all its lessons. Voronin has more than once made U-turns in GUAM and in relations with Russia, and there is no guarantee that he will not do so again."
Many political analysts in Moldova question the benefits of the Ukrainian proposal.
Bogdan Tirdea, head of Moldova's Social Democratic Institute, said: "Ukraine has a clear goal, NATO membership, even though this poses a risk of huge economic losses, but it is not clear if Moldova would gain anything from the project. It may encounter three problems: decreased gas supplies, growing gas prices, and a slowdown in the settlement of the Transdnestr conflict, which has recently been showing feeble signs of progress."
The GUAM summit hosts attempted to smooth over Voronin's decision, saying that he "still hopes naively that Russia will help restore his country's territorial integrity."
According to the state chancellery of Georgia, "the Moldovan president will certainly attend subsequent summits, after his childish dreams are put to rest."
Nezavisimaya Gazeta
Putin, Medvedev to set up two-party system
Prime Minister Vladimir Putin and President Dmitry Medvedev have decided to facilitate the creation of a two-party system in Russia.
According to the popular daily Nezaivisimaya Gazeta, Medvedev is working with A Just Russia, whose leadership is set to be reshuffled, and Putin with the United Russia party.
The recent elections, when the authorities were too busy strengthening United Russia, almost buried the idea of a multiparty system in Russia.
"This is a long story," said a high-ranking source. "Now that the elections have shown who is who, I think that A Just Russia has a bright future."
The source said there should be no rivalry between the two centers of power. The goal is to double the efforts to transform the country's political system, which is why the State Duma, the parliament's lower house, adopted in the first reading a bill on increasing allocations to political parties.
Putin sharply criticized the United Russia leadership during a Sunday meeting with the party's parliamentary group in the Lesnye Dali holiday hotel near Moscow. Unless they do something to improve the situation, socially important projects that can win broad public support will be divided between United Russia and A Just Russia.
Alexei Malashenko, a researcher at the Carnegie Moscow Center, said: "Not the whole of the party, but only about 30 of its leaders have been criticized. Putin said they are feeble, lack initiative, and are unpopular and unreliable. In this situation, power in the provinces will depend on governors, who are unknown entities. In principle, the authorities have made a gross mistake. Instead of nurturing provincial leaders to be liberal yet ready to support the Kremlin, they have made a rather thin broth [out of political parties]."
Medvedev is not patronizing A Just Russia for ideological reasons, because the ideas of "new socialism" do not correlate with the president's liberal program.
Dmitry Orlov, head of the Russian Agency for Political and Economic Communications, said: "This is an example of the division of powers and responsibilities in working with political parties between Putin and Medvedev."
Gazeta.ru
Russia no longer likened to Nigeria - Putin's former adviser
The current Russian government has repeatedly come under severe criticism in the past few years. It was accused of raiding property, human rights abuse, aggressive foreign policy and genocide against it own citizens. But whatever criticism it drew, it still had a powerful counter-argument - a good macroeconomic performance, which was an uncontestable achievement of the post-perestroika government. Unfortunately, that argument is no longer valid, said Andrei Illarionov, former aide to the Russian president, and president of the Institute of Economic Analysis (a Moscow think tank).
There are two dozen countries similar in many ways to Russia, Kazakhstan, Venezuela, Iran and Azerbaijan, but having substantially lower inflation levels. Their most important difference from those five is higher-quality macroeconomic policies pursued by their governments, Illarionov said.
One of those counties is Nigeria - a country one cannot help likening modern Russia to.
Like Russia, Nigeria is a large country, with a population of 151 million (141 million in Russia). Like Russia, Nigeria is a long way from the world's model democracies, law governed and effectively managed economies. It also benefits from a high inflow of foreign capital (6.7% of GDP in Russia and 5.2% in Nigeria in 2007) and is a major energy exporter. Like Russia's, Nigeria's national currency has appreciated against the dollar in the past 12 months, although not so much as in Russia (9.9% and 7.9% respectively). However, Nigeria is not as rich as Russia, as its per capita GDP is only one-sixth or one-seventh of Russia's figure ($1,800 and $11,800 PPC respectively).
By all the objective evidence, inflation in Nigeria should be higher than in Russia, but it's not, Illarionov said. In the past 12 months, prices in Nigeria went up by a mere 7.2%, and in Russia, by 15.1%.
Russia is no longer pompously compared to world economic leaders. We know only too well that Russia is nothing like America. Nor is it any more similar to Germany, Japan or even Portugal. It turned out that we are also a long way from Estonia, Ukraine and Georgia. Then certain media suggested, with a clear attempt at a shocking sensation, that Russia was more like Nigeria than anything else.
But that seems over too now, Illarionov said. At least, being compared to Nigeria is no longer humiliating for Russia - but it might be so for Nigeria. It is time the media turn the suggestion into a question: why isn't Russia at least like Nigeria?
The era of yet another benchmark in Russia's policy is over. In 1960, Nikita Khrushchev urged to "catch up with and overtake" America. In 1990s, Russian reformers set themselves a goal of "doing it like in Poland." Ten years later, the would-be president vowed to bring the country up to Portugal's level. Another eight years, and Russia now has a new macroeconomic policy model - Nigeria, Illarionov concluded.
Vedomosti
State to claim half of oil export earnings
The oil export duty in August will again reach a new high: $495 per ton. If world crude prices during this period stay at the June mark, profits from oil exports will drop by one-quarter.
Alexander Sakovich, deputy head of the customs department at the Finance Ministry, said the oil export duty in August and September will again shoot up to a record high of $495.9 per ton (the current rate is $398.1). The figure has been calculated from a formula based on the average price of the Russian Urals blend in Europe, which is $123.36375 per barrel and was obtained from monitoring data for May and June. Accordingly, he said, the duty on light petroleum products will rise from $280.5 to $346.4 per ton and on heavy petroleum products, from $151.1 to $186.6 per ton.
Duties will thus claim half of all oil export earnings. But Sakovich is certain that the industry will not suffer, even though windfall profits will be slightly dented.
Vitaly Kryukov, an analyst with Capital Investment Group, said that for oil exports to stay profitable as in June (at $48.1 per barrel), the Urals average price in August and September must be $146 per barrel. If the average oil and oil product prices in August and September remain at the June level, then oil profitability will drop by 28%, and diesel and fuel oil, only by 7% and 9%, respectively. That will make petroleum products even more attractive to export.
Kryukov added that in January-June the oil export duty climbed by $22 and the Urals price by $46 per barrel, compared with the same period of last year. "If this gap in rates keeps as wide, that will benefit oil and gas companies," he concluded.
"Duties follow in the footsteps of prices, so you need not expect a drop in the profitability of oil companies," said LUKoil spokesman Gennady Krasovsky. He said the oil sector should expect trouble only if oil prices slip dramatically in the high-duty period, and that concerns above all companies with low-level refining capabilities.
While the giants need not worry, smaller companies could take a beating, said Yelena Korzun, director-general of the Association of Small and Medium-Size Oil Producing Enterprises. Their specific costs are higher than the industry's average.
"Our fields are only 16% developed, and need investment, but funds are lacking," she said. "Besides, most of them are small and geologically intricate, making their development more costly."
Kommersant
Regulator blacklists individuals and companies financing terrorism
One of Russia's least open financial market regulators, the Federal Service for Financial Monitoring (Rosfinmonitoring), is planning to publish its black list of individuals and companies suspected of involvement in terrorist activities.
The banking community sees that as the regulator's way of drawing broader public attention to the money laundering problem. This initiative will certainly increase regulators' pressure on banks and is fraught with certain reputational risks, experts warn.
The official goal of making the list public is to make it easier for the market players to abide by the law, and to spur anti-money laundering efforts.
"It currently takes three days to update the list, because the updated file is first sent to the Bank of Russia's central management, then forwarded to its territorial departments, and only after that to banks," said Alexander Baskakov, deputy chairman of Sobinbank. He estimates that updating the list on the website could not take more than one hour.
Banks agree that by making its black lists public, the regulator is also trying to involve the general public in the fight against money laundering, along with the services it controls.
"If Rosfinmonitoring's initiative becomes known, it will receive more warnings on suspicious individuals, companies and their actions, and not only from financial institutions," Baskakov went on.
"It could be a good solution for fighting extremism," echoed Alexander Dolgopolov, deputy chairman of bank Vozrozhdenie.
Market players still think that the risks could outweigh the potential benefits from the regulator's initiative.
"I don't know how banks would be alerted to updates of the list on the Rosfinmonitoring website," Baskakov said. "If banks are not alerted somehow, too much will depend on the human factor. A bank could miss an update and violate the law involuntarily," he added.
Banks also have concerns about the blacklists posted with free access on the Rosfinmonitoring site being used for unfair competition. "Websites are vulnerable to hacker attacks," said Yelena Fedosova, Sberbank chief for monitoring clients' operations. "There is a risk that the list might one day contain names or organizations which have nothing to do with extremist activities." That would be a blow to the reputation which would not be easy to compensate for, she warned.
RBC Daily
One in five Russian companies encourages whistle-blowing
Russian business is gradually learning from its overseas counterparts to introduce corporate whistle-blowing, International Grant Thornton said in a study. The study said that 22% of Russian companies seek to create conditions for potential whistle-blowers. Experts warn that a regular practice of whistle-blowing could do a disservice to the company management.
The study has found that most of the outfits encouraging people blowing the whistle are in Latin America (68%). Their lowest percentage is found in East Asia (29%), with the exception of China, where no investigations were carried out. All in all, staff of 7,800 companies in 34 countries were interviewed.
In Russia, the survey covered 250 companies. Asked if the company was creating conditions for potential informants, most yes-answers came from companies in Nizhny Novgorod (40%). Samara and Yekaterinburg shared second place (20%), St. Petersburg and Perm, third (with 18%), while Moscow came with 16%.
Although Russia ranked one of the lowest in international standings, pollsters were still surprised to find that one in five Russian companies was seeking to establish a system of corporate whistle-blowing.
"This means something is changing in society," said Ivan Sapronov, a Grant Thornton partner. But he does not think their number will grow in the future. "While in Germany or Switzerland they take such a behavior for normal, in Russia the attitude to denouncers has always been and will remain to be sharply negative," he said. He also warned that irregularities in corporate discipline need proving in the first place. "Gossip-level information, if heeded by the management, could interfere with company running," he said.
His view is shared by Irina Parovina, staff manager at Penny Lane Personnel. "Encouragement of whistle-blowing could provoke a climate of distrust among the grass-roots and destroy the team spirit," she said. Also, the ones who nit-pick others' faults are themselves not sure of the quality of their work and would like to set up an Aunt Sally.
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