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Where's the beef?
Tim Wall - Moscow News editorial - themoscownews.com - 5.24.12 - JRL 2012-96

Kremlin-watching investors in Russia have, over the years, become used to being sold a dummy ­ particularly around election time, when promises of reform are in abundance. Kremlin and Saint Basil's
file photo

The government's privatization program, endorsed by Dmitry Medvedev as outgoing president, may not actually be carried out by Vladimir Putin ­ at least, not in the form it was intended.

Igor Sechin, possibly Putin's closest right-hand man, may have left the Cabinet ­ but he now has a center of power all his own at the helm of Russia's biggest oil company, Rosneft. It is highly unlikely that Sechin will allow much of the company, one of the crown jewels of the Russian economy, to go to outsiders ­ even if he is happy to bring in Western multinationals such as Exxon to bring their expertise and finance to Arctic exploration projects.

Other former ministers, who favor a strong, Chinese-style role for the state in the economy, have merely been shifted to the Kremlin as Putin's advisers, forming what are calling a "shadow Cabinet." Speculation is rife that they could yet throw a big spanner in the works for Medvedev's privatization program.

Another key signal that some of the "prize beef" could be taken off the menu came this week, when the returning president put majority stakes in several energy companies back on the list of strategic companies ­ meaning that they cannot now be sold into private hands.

It may be pure coincidence, but this week we saw Medvedev and his pick for deputy prime minister, Arkady Dvorkovich, down on the farm in the Bryansk region, checking out cattle. Such photo opportunities have been used from time to time by Putin to show his support for the agriculture industry. But throughout Putin's time in office, particularly during the 2000-08 period of less powerful, "technical" prime ministers, such trips have usually been delegated down the chain of command.

Given the government and Kremlin reshuffles this week, investors may well be asking themselves now, "Where's the beef ?"

We may even have to wait until the cows come home to see if Medvedev's privatization program ever becomes reality ­ at least in a form that investors would like to see.

Keywords: Russia, Politics - Russia, Economy, Business, Investment - Russian News - Russia

Kremlin-watching investors in Russia have, over the years, become used to being sold a dummy ­ particularly around election time, when promises of reform are in abundance.

Kremlin and Saint Basil's
file photo

The government's privatization program, endorsed by Dmitry Medvedev as outgoing president, may not actually be carried out by Vladimir Putin ­ at least, not in the form it was intended.

Igor Sechin, possibly Putin's closest right-hand man, may have left the Cabinet ­ but he now has a center of power all his own at the helm of Russia's biggest oil company, Rosneft. It is highly unlikely that Sechin will allow much of the company, one of the crown jewels of the Russian economy, to go to outsiders ­ even if he is happy to bring in Western multinationals such as Exxon to bring their expertise and finance to Arctic exploration projects.

Other former ministers, who favor a strong, Chinese-style role for the state in the economy, have merely been shifted to the Kremlin as Putin's advisers, forming what are calling a "shadow Cabinet." Speculation is rife that they could yet throw a big spanner in the works for Medvedev's privatization program.

Another key signal that some of the "prize beef" could be taken off the menu came this week, when the returning president put majority stakes in several energy companies back on the list of strategic companies ­ meaning that they cannot now be sold into private hands.

It may be pure coincidence, but this week we saw Medvedev and his pick for deputy prime minister, Arkady Dvorkovich, down on the farm in the Bryansk region, checking out cattle. Such photo opportunities have been used from time to time by Putin to show his support for the agriculture industry. But throughout Putin's time in office, particularly during the 2000-08 period of less powerful, "technical" prime ministers, such trips have usually been delegated down the chain of command.

Given the government and Kremlin reshuffles this week, investors may well be asking themselves now, "Where's the beef ?"

We may even have to wait until the cows come home to see if Medvedev's privatization program ever becomes reality ­ at least in a form that investors would like to see.


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