Russia trying to maintain balance in South Caucasus
Russia has been trying to balance the interests of Armenia and Azerbaijan in order to maintain stability in the South Caucasus, a strategic region to the south of its borders. President Dmitry Medvedev usually makes sequential visits to these two countries, which have been at odds for years over the disputed Nagorno-Karabakh area.
In August 2010, Russia and Armenia extended the deployment of the Russian 102nd Military Base at Gyumri until 2044. The protocol reads that the base protects the security of both Russia and Armenia jointly with the Armenian troops.
However, the Russian president's aide, Sergei Prikhodko, later said the document does not stipulate Russia's commitment to protect Armenia from its neighbor, Azerbaijan.
The talks on a peaceful settlement of the Karabakh conflict began in 1992 within the framework of the OSCE Minsk Group, which Russia co-chairs together with France and the United States. The group has made minor progress, but Azerbaijan claims that Armenia is drawing out the process. Azerbaijani President Ilham Aliyev said that if the talks are disrupted his country would have to use military force to resolve the problem.
It is an alarming statement.
Armenia is Russia's oldest and closest ally in the South Caucasus, and so Russia is unlikely to remain aloof if its conflict with Azerbaijan flares up again. Of course, Russia will not take part in the fighting, but it will certainly provide economic, diplomatic and other assistance to Armenia.
The agreement on the Gyumri base mentions the delivery of modern military equipment to Armenia and modernization of available weapons, such as the S-300 air defense missile systems.
At the same time, Azerbaijan also wants to buy the S-300 systems; the media reported its intention shortly before Medvedev's visit to Armenia.
Could the supply of the S-300 systems to Azerbaijan disrupt the balance of forces in the region?
No matter that the West may think or say, Russia's presence in the region meets the long-term interests of the two fighting countries. Russia believes the localization of the armed conflict between Armenia and Azerbaijan, the fact that they have been honoring the 1994 truce agreement and that the Minsk Group is working to resolve the problem are positive factors.
The Russian president holds regular consultations between the presidents of Armenia and Azerbaijan to consider a peaceful solution for the Karabakh conflict. Azerbaijan may not like it, but it admits that Russia, Azerbaijan and Turkey, which has recently signed an agreement on strategic partnership with Azerbaijan, do not need a new war in the Caucasus.
Russians content again
The proportion of Russians content with their lives has reached an all-time high of 81% this year, according to a survey conducted by Rosgosstrakh center for strategic research. This was an unexpected surge, after the number of "happy" Russians plummeted to 65% in regions hit by wildfires, and did not seem likely to rise again soon.
Now that the fires have been put out and the air is pure and smoke-free, the general level of satisfaction rapidly grew across the country. Surprisingly, this growth coincided with the onset of fall, although spring is traditionally a happier season. In fall and winter spirits usually go down along with air temperature.
This year, people's satisfaction dwindled in summer in regions hit hard by the abnormal heatwave, drought and wildfires. In early August, when Moscow was suffocating in thick smoke, the proportion of residents happy with their lives fell to 76% from 84% in May. Other regions hit by the natural disaster saw an even more drastic fall in public spirits. However, the average decline across Russia was a mere 1%, because fortunately, the area affected by wildfires was in fact rather small compared to Russia's vast expanses.
So what does the feeling of contentment depend on? Analysts believe general satisfaction is the result of meeting a certain social standard dominating the community.
"Most Russians' ideals of life quality were shaped back in the Soviet era and included their own apartment, a car, a dacha (summer house), a sofa set and a color TV. That level of prosperity had been exceeded by 2003. We have gone far ahead of the Soviets' notion of happiness," said Alexei Zubets, head of the Rosgosstrakh center for strategic research.
Moreover, around 15% of Russians match the international "middle class" standards with at least one car per family, their own house or apartment, access to healthcare and education other than the free services provided by government-subsidized institutions, and at least one vacation abroad or at a southern Russian resort per year.
What can we expect in the coming years? Will the level of general satisfaction close on 100% in Russia? Analysts do not believe there will be any significant growth or decline from the current level.
"On the one hand, we have reached a certain peak. After that, people will become more critical of their own goals and ambitions. On the other hand, the national economy is experiencing a shortage of qualified professionals. Therefore, those who are determined to work hard will find good jobs. That is, those who wish to earn a good living will be able to do so," Zubets said.
Regions to be rewarded for attracting investors
Financial aid to the regions should depend on how well local administrators attract private investors, believes the Ministry of Economic Development.
The size of interbudgetary transfers to the regions from the federal budget must depend on their steps to improve the investment climate, Sergei Belyakov, director of a department at the Ministry of Economic Development, said at the IX International Investment Forum Sochi-2010. The ministry will make the appropriate proposal at a State Council meeting to be held before the year's end.
Federal measures alone are insufficient to improve the investment climate , he explains. "The regions have different start-up conditions but they all hope for budget financing. That is a sponger's philosophy and local authorities should be weaned from it."
Interbudgetary transfers make about one-sixth of all revenues in regional budgets. The regions' efforts to improve their investment climate are currently not taken into account in providing help to them, but such a coefficient can be introduced for grants or subsidies, says a Finance Ministry official, depending, for example, on the contribution made by small businesses to the regional economy.
The basic issue is what the federal center will consider measures to improve the investment climate, says Perm Territory Governor Oleg Chirkunov. He is echoed by an official from the administration of the Volgograd Region, who says the region does not fear novel ideas: they are now establishing a development corporation and a mortgage fund and spending money on infrastructure.
The investment climate depends, above all, on the regions, says Alexander Galushka, vice-president of the public organization Delovaya Rossiya. The State Council meeting will make public its program for improving the investment climate: [the list of initiatives includes] "Improvement of the administrative environment, the lifting of tariff and infrastructure barriers, tax and financial incentives, boosting demand for new products, and providing investors with suppliers and personnel."
The Economic Development Ministry's proposal could provide one of the most effective levers for improving the investment climate, believes Alexander Andryakov from the Economic Expert Group (EEG): the coefficient should be adopted for subsidies, leaving out grants to balance the budget.
Melting polar icecap spells unpredictable consequences
Hundreds of millions of people could be affected by the melting of Arctic ice to abnormally high temperatures, Russian Minister of Civil Defense, Emergencies and Disaster Relief Sergei Shoigu told a news conference on Monday.
The news conference was devoted to the upcoming international forum "The Arctic: Territory of Dialogue," organized by the Russian Geographical Society and scheduled to be held in Moscow September 22-23.
Shoigu said that over 800 million people could be affected if temperatures continued to rise, and that melting Arctic ice could cause subsidence across the Arctic Circle, potentially causing cracks to appear in building walls, bridges, and the foundations of hydrotechnical-facilities.
He said that Russia and other Arctic states should develop a common regional safety and security policy.
Alexander Frolov, Head of the Federal Service for Hydrometeorology and Environmental Monitoring (Roshydromet), said his service would propose that the government examine the issue of Russia's Antarctic strategy to 2020 and beyond.
Frolov said that Russia had never stopped operating in the Antarctic, and that all of Russia's ten research stations (five year-round and five seasonal) that are based there had been working non-stop since Soviet times.
Seasonal stations are kitted out with automatic equipment, and the Akademik Fyodorov scientific diesel-electric research vessel has been carrying out maintenance work on them for the past two years.
The problem global warming poses is becoming more pronounced. The Minister of Natural Resources and Environment Yury Trutnev has previously admitted that global warming is real, and that humankind would start to feel its impact from 2030.
Environmentalists confirm the gravity of these problems. "It is absolutely true that many people could suffer as a result of ice melting in the Arctic. Small island states will be affected first," said Greenpeace Russia programs director Ivan Blokov.
He added that this problem would affect everyone on the planet.
Alexei Kokorin, head of climate-and-energy programs at World Wildlife Foundation - Russia, agreed that the global climate depends on the situation in the Arctic.
"Many people living near sea level will have to be resettled. Bangladesh, Shanghai and other major cities, primarily Asian cities, will be affected. This could affect an estimated 800 million people," Kokorin noted.
No one should remain indifferent to these changes in the Arctic, the analyst said. "The entire world, and not just Russia and Canada, should care about what is happening in the Arctic," Kokorin stressed.
Grassroots campaign to monitor price growth
An attempt by the United Russia party to launch a nationwide "grassroots oversight" campaign to monitor prices has brought to light some fundamental problems of the food market. First, the failure of the grain, potatoes and buckwheat crops has triggered the process of pricing up foods across the board, which may involve all goods. Second, a new law on the state regulation of trade in effect does not work: supermarket chains continue to dictate their terms to the producers and as before demand from the suppliers a massive additional charge, increasing trade mark-ups to 500%.
The food market in Russia is the focal point of clashing interests between farm producers, processing companies, retail chains, consumers, the state, and the party in power. Agricultural producers are insisting that there are objective reasons for the increased food prices and are pressing for the highest possible purchase prices. The retailers are trying to maximize their mark-ups. The government has given up on the idea of freezing staple food prices, while United Russia is stressing the speculative motives for price growth and blaming the chains for ballooning prices.
"Two weeks' monitoring suggests that there are no underlying economic reasons for the price havoc. What we have is a volatile play of prices engineered by the suppliers and retailers and especially of trade mark-ups, which sometimes reach 500%," Irina Yarovaya, deputy head of the parliament's lower house committee on constitutional legislation, said on Monday. She is responsible for the party's project Grassroots Oversight. "We have spotted huge price hikes across the entire run of staple foods," says Viktor Zvagelsky, member of the parliament's lower house committee on economic policy and entrepreneurship.
Many are angry with retail chains, which have not altered their ways even after the new trade laws came into effect, and are continuing to force additional charges and mandatory fees on the suppliers. To curb the chains' appetite, United Russia has proposed that heavy fines be introduced for breaking the law on trade. At present the authorities have no tools with which to control the policy of the supermarkets, because no laws on fines have been passed yet.
The Federal Antimonopoly Service, meanwhile, reported on Monday that it had opened 123 cases following spot checks. The proceedings have been launched both over breaches of antimonopoly legislation and violations of the law on trade.
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MOSCOW, September 21 (RIA Novosti)