May 16, 2000    
This Date's Issues: 4302 • 4303 • 4304

Johnson's Russia List
#4304
16 May 2000
davidjohnson@erols.com


[Note from David Johnson:
1. Reuters: Russia's acting PM woos Duma before vote.
2. Reuters: Love blooms amid drunks and thugs in Russian film.
3. Boston Globe editorial: Pure Putin.
4. Reuters: EBRD's new Russia strategy linked to economy plan.
5. St. Petersburg Times EDITORIAL: The Election Is Over - Let the Battle Begin.
6. BBC MONITORING: RIVAL'S DEFEAT IN ST PETERSBURG POLL SEEN DUE TO SOBCHAK, YABLOKO LEGACY.
7. HELSINKI COMMISSION HEARING: 'THE PUTIN PATH: ARE HUMAN RIGHTS IN RETREAT?'
8. The Times (UK): Giles Whittell, Putin decree raises military rule fears.
9. Bloomberg: Russian Leaders on Putin's Call for 7 Districts.
10. Rossiiskaya Gazeta: REGULATIONS OF PLENIPOTENTIARY REPRESENTATIVES OF THE RUSSIAN FEDERATION PRESIDENT IN THE FEDERAL DISTRICTS.
11. Washington Post: David Ottaway, Vast Caspian Oil Field Found. 
Discovery May Spur U.S.-Russia Pipeline Rivalry.
12. The Guardian (UK): MOSCOW MINES A SURREAL VEIN: NEWS ANALYSIS PLATINUM FIASCO REFLECTS RUSSIA'S DEEPENING CHAOS.]


*******


#1
Russia's acting PM woos Duma before vote
By Gareth Jones


MOSCOW, May 16 (Reuters) - President Vladimir Putin's choice for prime
minister, Mikhail Kasyanov, courted the support of Russia's political
parties on Tuesday, one day before a confirmation vote he looks certain to
win. 


Parliament's lower house, the 450-seat State Duma, was due to vote on the
candidacy of the 42-year-old liberal economist on Wednesday after hearing
his plans for the country. 


``He will get a high level of backing,'' Oleg Morozov, head of the Russia's
Regions parliamentary group, told ORT public television. He forecast
support at just under 300 votes. 


Communist leader Gennady Zyuganov said his party, the largest in the Duma,
would allow its members to vote freely on Kasyanov's nomination, signalling
they had no strong objections to him despite his reformist views. 


But Zyuganov added a note of caution. ``This will be a government without
rudder or sails,'' he said, noting that Kasyanov has still to unveil a
concrete programme of action. 


He said the Communists would oppose Kasyanov's government if it embraced
the market-oriented proposals of German Gref, head of an economic
think-tank close to Putin. 


Putin and Kasyanov have already had a series of meetings with parliamentary
leaders. Only one group, the social democratic Yabloko party, has said
outright it will not vote for Kasyanov on Wednesday. 


SUPPORT FOR KASYANOV LOOKS SOLID 


Morozov's Russia's Regions group, the pro-Putin Unity bloc and the
nationalist LDPR of Vladimir Zhirinovsky have pledged support for Kasyanov. 


Former Prime Minister Yevgeny Primakov said his centrist Fatherland-All
Russia bloc was also likely to back Kasyanov. 


Deputies' generally positive assessment of Kasyanov stems largely from
their respect for his boss, Putin, who won Russia's March 26 presidential
election on a platform of restoring order and discipline in the vast,
impoverished nation. 


The current Duma, elected in December 1999, is far friendlier to the
Kremlin than the previous chamber, which was often at loggerheads with
former President Boris Yeltsin. 


Since coming to power, Putin has persuaded the chamber to back a
long-delayed nuclear arms treaty with the United States and the
Comprehensive Nuclear Test Ban treaty. 


The speaker of the Duma, Gennady Seleznyov, said Putin himself might attend
Wednesday's session. The debate which precedes the vote is due to start at
10 am (0600 GMT). 


NO BIG GOVERNMENT CHANGES FORSEEN 


A government source told Reuters on Monday that Putin would name the rest
of his government on May 18. No radical changes are expected although some
new names might appear. 


Putin has already made clear Defence Minister Igor Sergeyev will remain in
his post. Other key ministers like Foreign Minister Igor Ivanov also look
set to stay in office for now. 


Kremlin sources have said Communications Minister Leonid Reiman might
become first deputy prime minister while economist Alexei Kudrin has been
tipped for the post of finance minister. 


The sources say Greff, who is drawing up a 10-year economic plan for Putin,
might also find a place in the cabinet. 


Kasyanov has promised that as prime minister he would try to avoid big
economic jolts, though liberals are hoping for an acceleration in the pace
of reforms ahead of an expected fizzling out of Russia's year-long economic
rebound. 


Many analysts remain sceptical about Kasyanov's chances, pointing to his
lack of political experience and speculation that he is linked to some of
Russia's ``oligarchs,'' the politically influential businessmen who wielded
such clout in the later Yeltsin years. Kasyanov denies any special links. 


``Nobody in the Kremlin expects any decisive actions from Kasyanov,'' the
liberal weekly magazine Itogi said. 


``The task set for the new prime minister by the presidential
administration is simple -- to guarantee the normal, smooth working of all
the economic institutions for six to 12 months,'' it said, adding that the
new cabinet might not last very long. 


*******


#2
Love blooms amid drunks and thugs in Russian film
By Lee Yanowitch

CANNES, France, May 16 (Reuters)- ``Russians are pretty extreme, but Russian 
weddings are at the far end of the extreme. Everything happens -- the best 
and the worst,'' said Pavel Lounguine, shifting his hulk of a body in a 
garden chair. 


The Russian director's Golden Palm entry at the Cannes Film Festival is about 
just that -- a wedding in a small Russian mining town and the drunken 
revelry, thieving and rough-housing that goes on among the larger-than-life 
guests. 


``A wedding is the knife that opens the jar of life. It brings together all 
generations and all emotional relationships -- love, friendship and attitude 
towards money,'' Lounguine told Reuters in an interview. 


The film is set in the dreary town of Lipki some 200 km (140 miles) from 
Moscow, where the kind and simple coalminer Michka prepares to marry his 
childhood sweetheart Tania, a model who has abandoned her career and her 
married lover to return home. 


Tania's reasons for leaving her glamorous life in Moscow and returning to her 
shabby hometown are a mystery until we learn her secret: the three-year-old 
son whom she plans to take out of an orphanage. 


``The Wedding,'' Lounguine's fourth full-length feature, treats serious 
issues like poverty and alcoholism as a laughing matter as the festivities 
unfold in a joyous celebration of humanity -- vices and all. 


``Drunkenness is not depressing. It was important for me to people my film 
with living characters. I know people like that and I love them,'' the 
bearded director said. 


``The Wedding'' was initially written as a tragedy, but Lounguine's rapport 
with the people of Lipki -- many of whom appear as wedding guests in the film 
-- made him change his mind. 


``My exchange with the people of this town made me optimistic. I discovered a 
way of life that was much more joyful and it gave me strength,'' he said. 
``The first thing I'll do when I return to Russia is show it to them.'' 


The result is a jubilant, raucous film set in a depressing context of police 
corruption, poverty and crime. The viewer may cringe at the brutality, but 
will emerge feeling cheered. 


``I think I'm going to have problems with the intellectuals,'' Lounguine 
says. ``It doesn't have to be interpreted, I just want people to find some 
happiness when they see it.'' 


``There is no coded social or political message. The message is that life 
goes on.'' 


********


#3
Boston Globe
16 May 2000
Editorial
Pure Putin 


Russians and their well-wishers abroad did not have to wait very long for the 
first premonitions of what life may be like under President Vladimir Putin. 
The curtain-raiser for the new era suggests that, as many Russian and foreign 
analysts have feared, Putin's reign may be modeled after the authoritarian 
regime of General Augusto Pinochet in Chile: free markets without free 
expression.


Four days after his inauguration, the former KGB colonel sent security troops 
in ski masks and camouflage outfits on a raid of the Moscow offices of Media 
MOST, the independent media conglomerate that had been publishing and 
broadcasting materials disclosing Kremlin corruption and incompetence and 
criticizing the conduct of the war in Chechnya. 


Some of the motives for the crackdown on the parent company of the TV network 
NTV, the newspaper Segodnya, and the magazine Itogi are known. In the fierce 
partisan arena of Russia's media politics, these properties of the tycoon 
Vladimir Gusinsky had supported Putin's rivals for the presidency. Also, 
Gusinsky himself is a personal and business rival of Boris Berezovsky, the 
oligarch who was behind Boris Yeltsin's reelection in 1996 as well as Putin's 
meteoric rise to power.


Additionally, Gusinsky's newspaper, Segodnya, published an article April 26 
suggesting that one of the top officials in the FSB, the intelligence agency 
Putin himself had headed, is guilty of corruption. The ensuing crackdown on 
the press demonstrates that Putin will not hesitate to use his security 
services to suppress journalistic or political opponents.


Mikhail Gorbachev termed the armed raid on Media MOST a provocation that 
''recalls the methods of the past.'' Grigory Yavlinksi, the liberal leader of 
the Yabloko party, called the crackdown an exercise of ''direct pressure 
aimed at limiting freedom of the press.''


Washington, with its sorry history of solicitude for the original Pinochet 
model of governance, needs to show solidarity with Russian democrats, and 
now, while it is still possible to help them prevent the construction of a 
police state charged with managing a capitalist Russia.


*******


#4
EBRD's new Russia strategy linked to economy plan
By Dmitry Antonov 


MOSCOW, May 16 (Reuters) - The European
Bank for Reconstruction and Development (EBRD), one of the casualties of 
Russia's 1998 crisis, is ready to renew its commitment to Russia but is 
waiting for the government to unveil its economic plans. 


Dragica Pilipovic-Chaffey, director of the EBRD's Russia team, told Reuters 
the bank was developing a two to three year plan. 


``We have just prepared our new Russia strategy,'' she said. ``That is going 
to be discussed some time in June because we are waiting for the government's 
economic plan to come out in order to adjust our business plan,'' she said. 


Pilipovic-Chaffey was speaking ahead of this weekend's annual EBRD general 
meeting in the Latvian capital, Riga. Russia used to account for a quarter of 
the business of the bank, set up by European governments to aid post-Soviet 
transition. 


But that figure fell to 10 percent in 1999 when Russia accounted for 80 
percent of the bank's bad loan provisions and 50 percent of bad equity 
investment provisions. 


Russia's economic programme, charting the medium- and long-term policies of 
President Vladimir Putin, is expected to be unveiled after a new government 
is formed. 


The State Duma, the lower house of parliament, is due to consider Mikhail 
Kasyanov's candidacy for prime minister on Wednesday and ministers are likely 
to be named after this. 


``We are positive... we want to do more business than we have done in the 
last two or three years,'' Pilipovic-Chaffey said. 


The EBRD plans to make 500-700 million euros ($460-640 million) in loans and 
investment in Russia this year, up from 220 million euros in 1999. 


On Monday, the EBRD agreed to lend LUKOIL LKOH.RTS, Russia's biggest oil 
producer, $150 million over three years. 


ECONOMY BUOYANT 


Pilipovic-Chaffey said Russia's economy was performing well but it remained 
to be seen whether the government would take advantage of the current 
favourable climate. 


``Russia has a lot of things going for it at this point in time -- the 
financial and commodities markets are working in their favour,'' she said. 


``Earnings are much better than a few years ago. Budget and fiscal goals seem 
to be maintained. There is more demand for local goods,'' she added. 


``The question is now if the country is going to use this good climate to do 
some fundamental restructuring of its economy in order to benefit from it in 
the long run.'' 


Analysts were optimistic about investment prospects and expected this to be 
reflected at the EBRD meeting in Riga. 


``I think the EBRD meeting will confirm the bank's intention to continue 
investing in Russian industry and restructuring it,'' Sergei Glazer, head of 
Alfa-Bank's analytical department, said. 


``At the same time, I think the EBRD will make some serious statements about 
possibly cutting the volume of investments if Russia does not demonstrate its 
clear willingness to continue reforms on a broad front,'' he added. 


EBRD CAUTIOUS 


The EBRD works directly with Russian companies, while the two other major 
international financial organisations, the World Bank and the International 
Monetary Fund, offer more general, state-oriented support. 


The World Bank has released some loans for Russia this year, but the IMF has 
put lending on hold pending implementation of structural reforms such as new 
bankruptcy legislation and measures to reduce the level of barter in the 
economy. 


UFG economist Alexei Zabotkine said the EBRD would show greater caution after 
suffering in the 1998 financial crisis. 


``The bank got burned quite badly in the crisis. Its previous investments 
were not very successful, and its position on Russia is now rather 
cautious,'' he said. 


The EBRD has investments in four Russian banks, two of which -- Inkombank and 
Tokobank -- have been declared bankrupt. It has also struggled to restructure 
debts to truck maker Kamaz KMAZ.RTS, although it outlined a settlement last 
month. 


($1-1.094 Euro) 


********


#5
St. Petersburg Times
May 15, 2000
EDITORIAL
The Election Is Over - Let the Battle Begin


ONE week down, and if President Vladimir Putin has started as he means to 
continue, then the country's political battlefield will be strewn with 
corpses before long.


The raid by armed men in ski masks on the offices of Media-Most has set alarm 
bells ringing both here and abroad. This was a move that had the classic 
"Putin-as-KGB-reactionary" school in full cry: Even if, as some observers 
suspect, Putin didn't know much about the raid until it was all over, his 
vague mutterings about respecting the freedom of the press did nothing to 
calm journalists and human rights activists down.


But even more interesting is the president's plan to divide Russia up into 
seven enormous zones, each controlled by a presidential representative.


It's more interesting because of Gov. Vladimir Yakovlev's crushing win in 
Sunday's gubernatorial elections. With the whole Valentina Matviyenko affair, 
it appeared as though Putin had tried to take Yakovlev on, and lost 
convincingly, forcing Matviyenko to withdraw rather than end up with egg on 
his face, particularly so early on in his regime.


Yakovlev has beaten off a powerful challenger with ease, and just won a clear 
public mandate to govern this city for the next four years. Perhaps they 
don't like or trust him much, but the citizens of Petersburg know him, and 
since the city hasn't yet fallen apart, they're happy to stick with him.


It is unlikely that Putin feels the same way. This is, after all, a city of 
around 5 million people, with tremendous - but as yet unrealized - economic 
potential, and it is the president's home town to boot.


Putin doesn't like the other regional leaders, either, and has made a clear 
move to step on their territory. Like Yakovlev, Putin has also just won an 
election by a clear margin (although not as clear as it once seemed he might 
obtain), and apparently has the Duma and the Federation Council (so far, 
anyway) under his thumb.


But take St. Petersburg as a case study: a powerful governor in the 
ascendancy, versus a president with a strong element of control freakery, 
with personal animosity thrown in.


Assuming (probably rashly) that Putin takes Yakovlev on by using the law, we 
are in for a fascinating battle. Does Putin's rule only extend as far as the 
castle gates? Will the next challenge to Yakovlev be more effective than 
Matviyenko? If Putin wins, how much will he have to bend the law to do so - 
and will he bend it back once he is in control?


Or have we just seen the first shots fired in a battle that gives St. 
Petersburg the choice between the frying pan and the fire?


*******


#6
BBC MONITORING
RIVAL'S DEFEAT IN ST PETERSBURG POLL SEEN DUE TO SOBCHAK, YABLOKO LEGACY
Text of report by Russia TV on 15th May 


[Presenter] The main political news of the day, albeit not entirely
unexpected, was the election of Vladimir Yakovlev for the second term of
office as governor. 


The election in St Petersburg did not result in anything sensational. It
must be stressed that, according to preliminary data, the election will not
go to the second round: Whereas Yakovlev gained more than 70 per cent of
the votes, the man who came second in the race for the governorship,
right-of-centre candidate Igor Artemyev, had no more than 15 per cent. The
triumph of the incumbent is seen to have been in part due to low turnout,
at about 40 per cent. Those who did bother to turn up were inclined to
favour Vladimir Yakovlev. Igor Artemyev's electorate, on the other hand,
mostly never even touched the ballot papers. 


Those are preliminary data. Some in the city will now celebrate, while
others will regret that yet another opportunity has been missed. Our
special correspondent Gleb Ovsyannikov has the story: 


[Correspondent] There was nothing unexpected about it. What happened was
exactly what many had said would happen all along, even down to the sunny
weather which set in in St Petersburg on election day. 


The reaction of the two main contenders after the initial results were made
public came as no surprise, either. Through the force of habit keen to
uphold his image of a good manager, Yakovlev was attentive to the needs of
the city even at a news conference in the city electoral commission last
night. Artemyev spoke about mass violations in the course of the election
campaign and his intention to appeal against the outcome of the election. 


[Interviewer] What action will you take in connection with this? 


[Artemyev] That which is stipulated by the law. We always take action
governed only by the law. 


[Q] Can you be more specific? 


[A] Appropriate appeals to the Central Electoral Commission, the
Prosecutor-General's Office, the city prosecutor's office and, possibly,
the court. 


[Correspondent] Less than half the electorate came to the polls. Even so,
almost 73 per cent of the votes, which were cast for Yakovlev, cannot fail
to impress. Equally equivocal is the percentage - less than 15 - of those
who favoured the opponent of the incumbent. Many openly consider it a defeat. 


What are the reasons behind it? Indeed, the federal authorities took their
time to decide whom they would support. It is equally true that dirty
tricks were once again in use against the main rivals. The defacement of
Artemyev's posters, with a word superimposed to distort their meaning, is a
vivid example [Poster shown reads: We deserve better than Igor Artemyev.
The word "then" superimposed on a punctuation mark]. 


There were, however, other reasons, which originated from the recent
history of the city. 


[Lev Lurye, historian] The impression was that the choice to be made was
between Yakovlev, who is very much alive, and [ex-mayor Anatoliy] Sobchak,
who is dead. A conscious attempt was made to juxtapose Yakovlev as a modest
man who gets things done and Sobchak as a carnival and even somewhat
operetta character, who is remembered by having danced with Lisa Minelli
and having attended the engagement of [celebrities] Pugacheva and Kirkorov,
as well as by a whole number of other things which the city in general did
not like. Somehow, he is not remembered by anything good, even though he
did do a lot of good things. 


[Correspondent] Political scientists believe that Sobchak's shadow followed
Igor Artemyev throughout the election campaign. 


[Roman Mogilevskiy, head of Gallup St Petersburg] His main mistake, in my
view, is that in the past he backed Yakovlev. It was his main mistake. In
the minds of many voters, as invariably evidenced by our focus groups, he
is associated with his support for Yakovlev and his parting with Sobchak.
Consequently, he is seen as someone who can once again resort to action
such as that. The consciousness of the electorate retains such information.
It is deposited in it for good. 


[Correspondent] Igor Artemyev's perception as a member of the opposition,
representative of the rebellious Yabloko, did not help his popularity,
either. 


[Mikhail Reshetnikov, head of the East European Psychoanalysis Institute]
The public image of Yabloko, the force behind Artemyev, is not what it used
to be even five years ago. Yabloko is perceived as an opposition party,
albeit independent and quite respected. And I would go so far as to say
that the attitude to the opposition has now become more sceptical. 


[Correspondent] However, what is probably most important, political
analysts believe, is that St Petersburg failed to field against incumbent
Yakovlev a truly potent candidate who would have been able to represent the
city's establishment. 


That said, not all is lost. Vladimir Yakovlev's future looks quite
uncertain. His position may be seriously weakened once there is the head of
the newly established Northwestern Area, which will also encompass St
Petersburg. 


At his news conference last night, the re-elected governor pledged to open
a museum of election dirty tricks. Regardless of whether it was said in
jest or Vladimir Yakovlev was serious, the museum already exists. Tens of
posters such as these [see above], seen throughout the campaign as well as
in the period during which no campaign activities were to be held, are yet
to be removed. They have now become history and, thus, exhibits in that
very open-air museum of election dirty tricks. 


*******


#7
HELSINKI COMMISSION HEARING: 'THE PUTIN PATH: ARE HUMAN RIGHTS IN RETREAT?'


WASHINGTON, May 15 /PRNewswire/ -- The Commission on Security and
Cooperation in Europe will conduct a hearing on human rights abuses in
Russia following an attack by armed government security agents on the
Media-Most headquarters in Moscow. A Media-Most official is set to testify
about the raid at a hearing entitled "The Putin Path: Are Human Rights in
Retreat?" Other focal points of the hearing will be the continuing war in
Chechnya and fears that the human rights picture in Russia is turning for
the worse. 


The hearing will also assess security and economic issues and implications
for U.S.-Russia bilateral relations, in advance of President Clinton's June
summit with Russian President Vladimir Putin. The Putin Path: Are Human
Rights in Retreat? Tuesday, May 23, 2000 10:30 a.m. - 12:30 p.m. Room 2200
Rayburn House Office Building Washington, D.C. Open to Members, Staff,
Press and the Public Scheduled witnesses include: Lt. General William Odom
(Ret.), Director of National Security Studies, Hudson Institute; former
head of the National Security Agency Igor Malashenko, First Deputy
Chairman, Media-Most, Moscow Dr. Sarah Mendelson, Assistant Professor of
International Politics, Fletcher School of Law and Diplomacy, Tufts
University Dr. Georgi Derlugian, Assistant Professor, Department of
Sociology, Northwestern University Rachel Denber, Deputy Director, Europe
and Central Asia Division, Human Rights Watch Andrei Babitsky, (via
video-conference) Radio Liberty, Moscow 


Background: On Thursday, May 11, armed government security agents attacked
the headquarters of Media-Most corporation and it's subsidiary, the NTV
television station, seizing what a security service spokesman claimed were
illegally acquired tapes and transcripts of private conversations. NTV had
criticized some members of Russian President Vladimir Putin's
administration, as well as the government's conduct in the continuing war
in Chechnya. 


Human rights activists are also feeling the pressure. Some human rights
advocacy groups have been told that only the government can legally protect
human rights -- not NGOs. Last summer, Putin told a Russian newspaper that
"environmental groups were in the employ of foreign intelligence agencies." 


As a result of his reporting from besieged Grozny last year, Radio Liberty
journalist Andrei Babitsky remains in Moscow under investigation for
allegedly "participating in an armed formation." Babitsky was recently
awarded the OSCE Parliamentary Assembly's journalism prize for journalism. 


CONTACT: Ben Anderson of the Helsinki Commission, 202-225-1901 or
Ben.Anderson@mail.house.gov/ 17:49 EDT 


******


#8
The Times (UK)
16 May 2000
[for personal use only]
Putin decree raises military rule fears
FROM GILES WHITTELL IN MOSCOW


THE Kremlin was forced yesterday to calm fears that a bold new decree by 
President Putin could lead to the creeping militarisation of Russia's 
Government. 


Mr Putin's hold on power is challenged by dozens of regional governors ruling 
vast areas as fiefdoms, and he has moved swiftly to rein them in by 
announcing that he will appoint seven special envoys with sweeping powers 
over even larger tracts of the Russian hinterland. 


Moscow was abuzz yesterday with warnings that the new envoys would be 
expected to work hand-in-hand with regional military commandants to curb the 
authority of local elected officials. One headline in Vremya announced the 
creation of "military-federal districts" in which "the political government 
of Russia is going to be built according to army principles". 


Izvestia noted that the seven "superdistricts" correspond almost exactly to 
Russia's seven military regions, with headquarters in the same cities as 
military commands. 


The purpose of Mr Putin's weekend decree was to strengthen Russian federalism 
and "systematise executive authorities", a presidential spokesman was quoted 
as saying by Interfax news agency. "It is absolutely not the militarisation 
of the country," he said. 


An information war has broken out between Mr Putin's fledgeling 
administration and the Moscow press, and it masks a bitter struggle between 
the Kremlin and Russia's unruly regions for the power ceded to them in the 
Yeltsin era in return for their support at critical times, in particular the 
ailing Yeltsin's 1996 re-election race. 


Mr Putin wants that power back. Following up on a campaign pledge to rebuild 
the centralised state that he claims is part of Russia's "genetic code", he 
plans to scrap an entire layer of federal bureaucracy that put a presidential 
envoy in each of the 89 regions under Mr Yeltsin but left them all powerless 
next to the elected regional governors. In the most egregious case, Yevgeni 
Nazdratenko, the notoriously corrupt governor of the far-eastern Primorskiy 
region, routinely ignored federal laws and Kremlin edicts. 


The seven new envoys will report exclusively to Mr Putin and be responsible 
for enforcing federal law and for hiring and firing federal employees across 
areas as large as Western Europe. They will have broad rights to enter and 
search other government offices as well as serving as the sole regional 
conduit for presidential thanks and patronage. Alongside them, Vremya 
reported, regional military commandants will consolidate their power over 
uniformed units from the border guards, the Interior Ministry and the Federal 
Security Service or FSB. 


Since the decree was issued on Saturday, several of Russia's best-known 
regional bosses have fallen into line rather than risk an early confrontation 
with Mr Putin. According to Mintimer Shaimiyev, leader of the mainly-Muslim 
republic of Tartarstan, the new envoys will "serve as a more effective 
instrument of realising the President's constitutional powers". 


In practice such powerful figures have blithely defied Kremlin orders in the 
past in defence of local tax revenues that have made them and their 
associates rich. They are likely to go on doing so unless the envoys are 
given serious budgets and personnel to enforce Moscow's rule. 


But then, Lilia Shevtsova of the Moscow Carnegie Centre said, Mr Putin would 
have a problem. "He can only imagine what sort of rivals they will be for his 
job in 2004." 


****** 


#9
Russian Leaders on Putin's Call for 7 Districts: Comments


Moscow, May 16 (Bloomberg)
-- The following are comments by Russia's regional governors and leading 
politicians on President Vladimir Putin's order to set up seven federal 
districts in Russia each of which will have a Kremlin representative. 


The comments were published in the daily Sevodnya and carried on news agency 
Interfax. 


Aman Tuleev, governor of Kemerovo region: 


``I don't see anything bad in the president's decree. First of all it means 
an attempt to restore order inside the administration. The question is what 
are the president's representatives going to do. If they will be appointed in 
addition to the existing president's representatives, then what is the sense 
in appointing them. Otherwise what will happen with the actual 
representatives? What is positive about the decision is that this decree will 
help to establish order in regional constitutions, which don't correspond to 
the Constitution of the Russian Federation. If the seven representatives are 
going to help governors battle corruption, it will also be very good. But if 
they are going to supervise over governors, we are certainly not going to be 
very enthusiastic about it. 


Yuri Evdokimov, governor of Murmansk region: 


``The president's decree is not a surprise to me. We have recently discussed 
the question of reforming the system of regional representatives during a 
private talk with Putin. The decree is aimed at strengthening the federal 
control over the regional authorities. The decree does not suppose any 
reorganization of the existing territorial division in the country.'' 


Vkadimir Yakovlev, governor of St. Petersburg: 


``I believe the decree does not in any way limit the rights of the governors. 
The regions have plenty of authority, which must not be divided but must be 
used jointly to run an enormous country.'' 


Yuri Luzhkov, Moscow mayor: 


``The decree will raise the efficiency of the country's administration. The 
representatives should be endowed with serious powers, so that governors 
could solve problems in their regions by themselves without addressing the 
government.'' 


Gennady Zyuganov, leader of the Russian Communist Party: 


``It is extremely important to restore the vertical system of authority and 
normal control over the country, as some of the regions have actually turned 
into khans and sheiks. Bureaucratic rules and the absence of law have 
blighted many regions, making ordinary citizens suffer. 


``The decision for which the president has opted is a replica of the 
principal of seven military districts into which Russia is divided. Before 
signing such a decree the president should have announced his concept for 
restoring the normal system of control over the country.'' 


Vladimir Zhirinovsky, leader of the Liberal Democratic Party: 


``I completely support the decree and am very happy that the new president 
started carrying out the program, about which I have been talking during the 
last 10 years and which was published in my book titled `Russia's New 
Territory System.' Everything in Putin's decree coincides with my book: the 
number of regions and their names.'' 


******


#10
Rossiiskaya Gazeta
May 16, 2000
[translation from RIA Novosti for personal use only]
REGULATIONS OF PLENIPOTENTIARY REPRESENTATIVES OF THE 
RUSSIAN FEDERATION PRESIDENT IN THE FEDERAL DISTRICTS

I. General

1. A Plenipotentiary Representative of the Russian 
Federation President in a federal district (hereinafter 
referred to as plenipotentiary representative) is an official 
representing the Russian Federation President within a given 
federal district.
The plenipotentiary representative shall be the conductor 
of the powers of the head of state within a given federal 
district.
2. The plenipotentiary representative is a federal civil 
servant on the staff of the Russian Federation President's 
Administration. 
The plenipotentiary representative shall be appointed a 
released by the Russian Federation President as recommended by 
the chief of the Russian Federation President's Administration.
The plenipotentiary representative shall be appointed and 
released by the Russian Federation President as recommended by 
chief of the Russian Federation President's Administration.
The plenipotentiary representative shall be directly 
subordinated and accountable to the Russian Federation 
President.
The plenipotentiary representative shall be appointed for 
a term to be established by the Russian Federation President 
but not in excess of the term in office of the Russian 
Federation President. 
3. In his activities, the plenipotentiary representative 
shall be guided by the Russian Federation Constitution, the 
federal laws, decrees and instructions of the Russian 
Federation President as well as these Regulations.
4. The plenipotentiary representative shall have deputies 
and allocate duties thereto and guide the activities thereof.
Deputies to the plenipotentiary representative shall be 
federal civil servants on the staff of the Russian Federation 
President's Administration. 
Deputies to the plenipotentiary representative shall be 
appointed and released, encouraged and penalised by the chief 
of the Russian Federation President's Administration.

II. Basic Tasks of a Plenipotentiary Representative 
5. The basic tasks of the plenipotentiary representative 
shall be as follows:
- to organise, in a given federal district, the work by 
the bodies of state authority to implement the guidelines of 
the state's domestic and foreign policies as defined by the 
Russian Federation President;
- to organise control over the implementation in the 
federal district of decisions by the federal bodies of state 
authority;
- to be the conductor of the Russian Federation 
President's personnel policy in the federal district; and - to 
provide regular reports to the Russian Federation President on 
national security matters in the federal district and on the 
political, social and economic situation in the federal 
district, and to make relevant suggestions to the Russian 
Federation President.

III. Functions of a Plenipotentiary Representative 
6. With the aim of implementing the tasks entrusted to 
him, the plenipotentiary representative shall perform the 
following functions:
- coordinate the activities of the federal bodies of 
executive authority in a given federal district;
- analyse the efficiency of the activities of the law 
enforcement agencies in the federal district as well as the 
personnel sufficiency in these agencies, and make relevant 
suggestions to the Russian Federation President;
- organise interaction of the federal bodies of executive 
authority with the bodies of state authority of the Russian 
Federation's constituent members, local self-governments, 
political parties and other public and religious organisations;
- devise, in conjunction with inter-regional associations 
of economic interaction of the Russian Federation's constituent 
members, programmes of socio-economic development of 
territories incorporated into the federal district;
- coordinate candidacies for the appointment of federal 
civil servants and candidacies for the appointment of other 
officials in the federal district, in case their appointment to 
the posts is done by the Russian Federation President, the 
Russian Federation Government or the federal bodies of 
executive authority;
- organise control over the observance of the federal 
laws, decrees and instructions of the Russian Federation 
President, and resolutions and instructions of the Russian 
Federation Government, and over the implementation of federal 
programmes in the federal district;
- coordinate draft decisions of the federal bodies of 
state authority which affect the interests of the federal 
district or a constituent member of the Russian Federation 
incorporated into the federal district;
- coordinate proposals of granting state awards of the 
Russian Federation, of announcing the Russian Federation 
President's gratitude and on the granting of honorary titles of 
the Russian Federation, highest military and highest special 
ranks forwarded to the federal bodies of executive authority by 
the bodies of state authority of the Russian Federation's 
constituent members incorporated into the federal district;
- acting on instructions of the Russian Federation 
President, hand in state awards of the Russian Federation and 
announce the Russian Federation President's gratitude;
- participate in the work of the bodies of state authority 
and the local self-governments of the Russian Federation's 
constituent members incorporated into the federal district;
- acting on instructions of the Russian Federation 
President, organise conciliatory procedures aimed to resolve 
disagreements between the federal bodies of state authority and 
the bodies of state authority of the Russian Federation's 
constituent members incorporated into the federal district;
- make suggestions to the Russian Federation President to 
suspend normative acts of the bodies of executive authority of 
the Russian Federation's constituent members incorporated into 
the federal district, in case these acts contradict the Russian 
Federation Constitution, the federal laws and the Russian 
Federation's international commitments, or violate the rights 
and freedoms of individuals and citizens; and - interact with 
the Russian Federation President's Main Control Department and 
the Russian Federation's prosecutors' offices while verifying 
the compliance in the federal district with the federal laws, 
decrees and instructions of the Russian Federation President, 
and resolutions and instructions of the Russian Federation 
Government.

IV. The Powers of the Plenipotentiary Representative 
7. The plenipotentiary representative may:
- request and receive, in accordance with the established 
procedure, materials from independent divisions of the 
Administration of the President of the Russian Federation, 
federal bodies of state authority, as well as bodies of state 
authority of constituent members of the Russian Federation, 
local self-governments, organisations located within a given 
federal district, and officials;
- dispatch his deputies and members of his staff for 
participation in the work of the bodies of state authority of 
constituent members of the Russian Federation and local 
self-governments located within the given federal district;
- make use, in accordance with the established procedure, 
of the authorised data banks of the Administration of the 
President of the Russian Federation and federal bodies of state 
authority;
- use state, including government, systems of 
communications;
- organise, within his competence, inspections of the 
fulfilment of decrees and instructions of the President of the 
Russian Federation, as well as the implementation of federal 
programmes, the use of federal property and resources of the 
federal budget in the federal district;
- forward the complaints and addresses of the citizens for 
the consideration of federal bodies of state authority, as well 
as the bodies of state authority of constituent members of the 
Russian Federation, local self-governments, heads of 
organisations located within the given federal district, and 
officials;
- move to the corresponding federal bodies of executive 
authority proposals on commending the heads of their 
territorial agencies located within the federal district, and 
on applying disciplinary measures to them;
- use the staff of the Main Control Department of the 
Russian Federation President and in case of need the staff of 
the federal bodies of executive authority and their territorial 
agencies, for inspections and analysis of the situation in 
organisations incorporated into the federal district;
- form advisory and consultative agencies.

8. When fulfilling his duties, the plenipotentiary 
representative shall have free access to any organisations 
located within the given federal district.

V. The Organisation of Operation of and the Provision of 
Services for the Plenipotentiary Representative 
9. The chief of the Administration of the President of the 
Russian Federation shall provide operational guidance of the 
plenipotentiary representative. 

10. The staff of the plenipotentiary representative, which 
shall be an independent division of the Administration of the 
President of the Russian Federation, shall provide direct 
services necessary for the operation of the plenipotentiary 
representative. The staff of the plenipotentiary representative 
shall include a corresponding district inspectorate of the Main 
Control Department of the Russian Federation President. 
The Main Control Department of the Russian Federation 
President shall provide methods guidance of the said district 
inspectorate on questions of organising control of the 
fulfilment of federal laws, decrees and instructions of the 
Russian Federation President, resolutions and instructions of 
the Russian Federation Government, and the implementation of 
federal programmes. 
The chief of the Administration of the President of the 
Russian Federation shall approve the structure and strength of 
the staff of the plenipotentiary representative and determine 
the number of deputies of the plenipotentiary representative. 

11. The plenipotentiary representative shall:
- supervise the operation of the staff of the 
plenipotentiary representative, ensuring the fulfilment of 
tasks set to him;
- appoint duties to his deputies;
- approve duty instructions for members of the staff of 
the plenipotentiary representative;
- appoint and dismiss members of his staff, commend them 
and apply disciplinary measures to them;
- sign official documents within his competence;
- issue instructions on questions of operation of the 
staff of the plenipotentiary representative;
- tackle questions pertaining to business trips of members 
of the staff of the plenipotentiary representative within the 
Russian Federation.

12. The plenipotentiary representative shall be 
headquartered in the centre of the federal district.
The state flag of the Russian Federation shall be raised 
over the office of the plenipotentiary representative; the 
state flag of the Russian Federation and a representation of 
the state emblem of the Russian Federation shall be placed in 
his office. 

13. The plenipotentiary representative shall determine the 
location of his deputies and his staff on the territory of the 
federal district. 

14. Corresponding subdivisions of the Administration of 
the President of the Russian Federation and the Business 
Management Department of the President of the Russian 
Federation, as well as the bodies of executive authority of 
constituent members of the Russian Federation located within 
the given federal district, acting on the basis of agreements 
with the Administration of the Russian Federation President, 
shall provide information, documentary, legal, 
material-technical and transport services to the 
plenipotentiary representative and his staff, allocate office 
and housing premises, and provide medical, social and everyday 
services to them. Allocations for these purposes shall be made 
from the budget of the Administration of the President of the 
Russian Federation. 

******


#11
Washington Post
May 16, 2000
[for personal use only]
Vast Caspian Oil Field Found 
Discovery May Spur U.S.-Russia Pipeline Rivalry
By David B. Ottaway


A consortium of Western oil companies has found a vast petroleum reserve in 
the northern Caspian Sea off the coast of Kazakhstan that may well be the 
largest oil discovery anywhere in the world in the past 20 years, according 
to U.S. officials and industry sources.


While efforts to map out the confines of the vast field have just begun after 
nine months of drilling, initial estimates of its size range from 8 billion 
to more than 50 billion barrels of oil, the sources said.


If the 480-square-mile deposit, called the Kashagan field, proves to be 
anywhere near the higher estimate, it could surpass the size of the North Sea 
fields. The last oil find of comparable size was in 1979, also in Kazakhstan, 
when it was part of the Soviet Union. That field, located onshore at Tengiz, 
is now being exploited by an international consortium led by the American oil 
company Chevron Corp.


"The Caspian is back on the map in a big way," said an administration 
official, who said the offshore Kazakh field may hold 32 billion barrels of 
oil "or maybe more."


Kazakhstan's prime minister, Qasymzhomart Toqaev, announced on May 10 that 
the consortium had found "big deposits of oil" but refused to speculate about 
the size.


The immediate political impact of the new Kazakh oil discovery is likely to 
be an acceleration of the competition between the United States and Russia 
for control over the pipelines that are being built, or planned, to transport 
growing volumes of Caspian oil to markets in Europe.


The Clinton administration has been promoting the building of a $2.4 billion, 
1,080-mile pipeline running from Baku, the capital of Azerbaijan on the 
western side of the Caspian, through Georgia to the Turkish port of Ceyhan on 
the Mediterranean coast. U.S. officials want to prevent any Caspian pipelines 
from running south through Iran and would also like to keep Russia from 
dominating all the export routes.


But the proposed Baku-to-Ceyhan pipeline, capable of carrying 1 million 
barrels a day, needs more Caspian oil to make it commercially viable. U.S. 
officials are hoping that Kazakhstan will solve this problem by exporting 
more of its crude to Azerbaijan across the Caspian in barges, or under it 
through a pipeline.


"If [the discovery] is confirmed, it would be a tremendously important boost 
to the Baku-Ceyhan pipeline," said John S. Wolf, the administration's chief 
Caspian oil negotiator.


Meanwhile, Moscow is pressing Kazakhstan, a former Soviet republic that still 
launches satellites for Russia, to ship the bulk of its oil through pipelines 
crossing Russian territory to their own ports. It has offered to expand one 
of its pipelines just to accommodate Kazakh exports.


Industry sources warned that it could be another five years before the 
Kashagan offshore field begins producing oil. Nevertheless, Kazakhstan 
appears to be emerging as the Caspian's major oil producer, overtaking 
Azerbaijan, where exploration for oil has yielded disappointing results.


Kazakhstan, a land of sparsely populated vast steppes, shares a 4,250-mile 
border with Russia and was the former Soviet Union's second largest republic. 
Its population was 16.5 million in 1998. Since gaining independence in 1991, 
it has been under the rule of President Nursultan Nazarbayev, a 
semi-authoritarian leader who has struggled to build an economy independent 
of Russia mainly by expanding its oil sector.


Even before the latest discovery, oil was the country's main export and main 
source of hope for development. In 1997, oil shipments abroad were valued at 
$1.5 billion, a quarter of the country's total exports.


The nine-company consortium, in which Exxon Mobil Corp. and Phillips 
Petroleum Co. are the only American partners, is expected to issue a 
preliminary statement this week about the Kashagan field. Oil analysts said 
the statement is likely to avoid any estimate of the oil field's size, or 
even use the word "discovery." This is because formal announcement of a 
discovery triggers time limits for the development of the field and the start 
of exports.


The consortium is also likely to be cautious at this stage because only one 
test well has been drilled so far in an area known as East Kashagan--the 
easternmost bulge of what is described as a dog bone-shaped field in shallow 
waters, stretching out deep underground. Sources familiar with the state of 
exploration there said initial indications are extremely promising and that 
the bottom of the field has not yet been reached. 


Lending credence to the probable discovery of a major find, the private 
Russian oil company, Lukoil, announced in March that it too has found a major 
deposit in an adjacent Caspian exploration zone that it estimates contains 
over 2 billion barrels of "proven reserves."


The initial estimates of the size of the new offshore Kazakh field do not 
represent proven reserves--the amount of recoverable oil in the field--but 
instead the total amount of oil that might be there. Oil companies are 
currently able to recover between one-quarter to one-third of the oil in most 
fields, but the proportion varies with the price of oil and the techniques 
used.


The North Sea fields, shared mainly by Britain and Norway, are currently 
estimated to hold around 17 billion barrels in proven reserves. The Kazakh 
onshore giant at Tengiz holds somewhere between 6 billion and 9 billion 
barrels in proven reserves. The world's largest oil field, at Ghawar in Saudi 
Arabia, contains 70 billion to 85 billion barrels of proven reserves. 


*******


#12
The Guardian (UK)
16 May 2000
[for personal use only]
MOSCOW MINES A SURREAL VEIN: NEWS ANALYSIS PLATINUM FIASCO REFLECTS
RUSSIA'S DEEPENING CHAOS


Russia had little luck during the Soviet era in achieving its aim of
disrupting the hated western capitalist enemy. But it is doing a lot better
now it has embraced the market economy and private enterprise. 


It is not just the country's mafia-run banks whose laundered funds -
allegedly - churn like a tidal bore through financial markets. Yesterday's
Platinum 2000 report from Johnson Matthey, the speciality metals group
based in Hatton Garden, London, highlights Russia's capricious behaviour in
the strategically critical area of 'white metals', principally platinum and
palladium. 


Indeed, post-communist Russia has emerged as the Saudi Arabia of
platinum-group metals, the 'swing' producer that can send prices sharply up
or down. 


Regrettably, it has yet to learn Saudi habits of restraint, diplomacy and
responsibility. 


In a normal year Russia supplies about a fifth of the world's platinum. In
1999, it decided, for reasons best known to itself, to supply less than
half that amount. 


The price shot up from Dollars 342 ( pounds 227) a Troy ounce to an 11-year
high in February last year of Dollars 573. 


In palladium - where Russia's position is even stronger, mining two thirds
of the world total - supplies were 'erratic,' notes Johnson Matthey, with
again a price surge coming on the back of Russian shortages from Dollars
334 an ounce to Dollars 444 by the end of 1999. 


With both metals, the US defence department had to sell thousands of ounces
from its own strategic stockpile to avert a global demand-supply crunch. 


In the popular imagination, platinum is known mainly as the rather vulgar
chief component of flashy jewellery for trashy jetsetters, whereas
'palladium' rings few bells at all, other than as a music hall. 


In reality, both metals - and their little sister, rhodium - are
increasingly in demand across the industrial spectrum. Chemical industry
use of platinum rose 15% in 1999, according to Johnson Matthey, while in
the electrical sector demand was up 50%. 


Palladium is popular in different corners of the electronics industry and
is in heavy demand as a dental alloy. 


But for both metals, the largest chunk of industrial demand is from the car
industry. For, by an interesting coincidence, at about the time the cold
war was drawing to a close, Russia's new capitalist friends - led by the
United States - were cleaning up their environmental act, with an emphasis
on restricting vehicle exhaust emissions. 


One jurisdiction after another demanded that new cars be fitted with
so-called catalytic converters. 


These devices work best with the use of large quantities of palladium,
which is efficient at converting polluting hydrocarbons into carbon dioxide
and water. 


There are substitutes - up to a point. Unfortunately, these are platinum
and rhodium, both subject also to Russian-triggered price swings. 


The 'cleaner and greener' legislative movement in the west during the late
1980s and early 1990s was based on careful costings, to ensure the bills
for the economy at large could be absorbed more or less painlessly. 


Years of disruption to white-metal exports from Russia could make a
nonsense of those costings. And car makers, already suffering from huge
overcapacity, could become the chief victims as they buy in ever more
expensive catalytic converters. 


In some ways, the blockages of Russian metals would matter less were Moscow
to be pursuing some devilishly clever strategy to humble the west. But
official behaviour - given that the country is crying out for hard currency
earnings - suggests less a reconversion to Bolshevism than a belated
discovery of surrealism. 


Johnson Matthey notes platinum and rhodium exports were strangled by the
extraordinary clause 19 in the Russian budget, passed in December 1998, pro
hibiting all but government agencies from selling the two metals. Clause 19
- for which 'there has been no satisfactory explanation' - was buried only
last month. 


Palladium, meanwhile, seems to have been subjected to some sort of
bureaucratic power struggle, which may explain a mystery cut in production
in January, which pushed the price to Dollars 800, nearly double its
December 1999 level. 


More extraordinary still, shipments were inhibited by a new export tax,
presumably designed to punish those trying to earn dollars for Russia. 


Amid all this uncertainty, an admirable sang froid was on display in Hatton
Garden yesterday, with Johnson Matthey noting that 1999 'was a year full of
incident'. That is one way of putting it. 


******

Web page for CDI Russia Weekly: 
http://www.cdi.org/russia