Russia in Review

Russia in Review: a digest of useful news from U.S.-Russia Initiative to Prevent Nuclear Terrorism for October 4-11, 2013

I. U.S. and Russian priorities for the bilateral agenda.

Nuclear security agenda:

Decommissioned Russian warheads are fueling “approximately half of the nuclear energy in the United States,” U.S. Under Secretary of State for Arms Control Rose Gottemoeller said. A final shipment of low-enriched uranium derived from 500 metric tons of highly-enriched uranium from Russian weapons is set to be loaded onto ships in St. Petersburg next month. (RIA Novosti, 10.09.13).
Most nuclear reactors in the United States rely on a type of lithium that is produced only by China and Russia, and the supply may be drying up, according to a GAO study. (New York Times, 10.09.13).
The Russian North Fleet’s Gremikha base will be cleared of spent nuclear fuel before 2020, Rosatom said. (Interfax, 10.10.13).
NNSA has made spring of 2014 the target for completing an assessment of its options for disposing surplus weapons-grade plutonium. (GSN, 10.09.13).
The House of Representatives could debate legislation to temporarily restore funding for the NNSA as the federal government remains partially shut down amid partisan gridlock over a U.S. budget. (GSN, 10.10.13).

Iran nuclear issues:

No significant developments.

NATO-Russia cooperation, including transit to and from Afghanistan:

Kommersant has gotten hold of a copy of a classified report on possible scenarios for the development of the situation in Afghanistan following the NATO contingent's withdrawal in 2014, prepared for the Russian Federation leadership. Its authors predict three scenarios -- all equally grim. The threat of Central Asia's destabilization will be the main challenge for Russia. (Kommersant, 10.05.13).

Missile defense:

No significant developments.

Nuclear arms control:

The U.S. and Russia agreed to update a 1987 accord aimed at reducing the risk of nuclear war to reflect changing technologies. (Bloomberg, 10.07.13).

Counter-terrorism cooperation:

No significant developments.

Cyber security:

Chairman of the House Intelligence Committee Mike Rogers said: “When you try to look at battle damage assessment, if you will, of what happened [as a result of the Snowden leaks] , it's significant and, in many cases, irreversible." (Washington Post, 10.10.13).
Four whistle-blowing advocates from the United States met with Edward Snowden in Moscow Wednesday and gave him an award for truth-telling. The father of Snowden arrived in Moscow Thursday, saying he believed his son is prepared to stay in Russia for a long time, with no intention to return to America (Washington Post, 10.10.13, Wall Street Journal, 10.11.13).
A far-flung group of geeks, supported by the U.S. State Department, has built a tool for anonymous communication that's so secure that even the world's most sophisticated electronic spies haven't figured out how to crack it. (Foreign Policy, 10.06.13).

Energy exports from CIS:

A law just out of the Kremlin is raising the specter of a new era in the development of the country's offshore oil and gas riches by streamlining the involvement of foreigners. Taking effect in January, the law allows state-controlled behemoths Gazprom and Rosneft to take on foreign companies to help extract reserves from under the seafloor and provides a partnership model that may prove lucrative for the foreigners. (The Moscow Times, 10.08.13).

Bilateral economic ties:

The United States will become the world's largest oil producer next year - overtaking Russia - thanks to its shale oil boom which has transformed the global energy landscape, the IEA said. (Reuters, 10.11.13).
The Russian Federation is interested in recovery of the U.S. economy and hopes that, being caused by a domestic political situation, the issue will be solved as soon as possible, Russian President Vladimir Putin said at at the APEC summit. Putin noted that “there is still a lot to do to make our work more effective, especially in the economy.” “Our mutual trade has been declining for the second year in a row,” he said. (RIA Novosti, Voice of Russia,10.08.13).
Russia holds about $144 billion in combined U.S. debt. (Washington Post, 10.10.13).

Other bilateral issues:

Speaking about the cancelled meeting with U.S. President Barack Obama, Russian President Vladimir Putin said: “I do not think that meetings should be held just for the sake of meeting. We have been engaged in regular, stable and quite effective work. I am certain that such a meeting will take place when the need arises." Putin said that the absence of Obama from the APEC Bali summit is quite understandable and that he would have done the same. (Voice of Russia, 10.08.13, Interfax, 10.07.13).
Employees at the U.S. Embassy in Moscow may soon join an estimated 800,000 U.S. government workers furloughed. (The Moscow Times, 10.11.13).
Russians are divided almost fifty-fifty on the possibility of a new "cold war" between Russia and the U.S. Some 46 percent of respondents said they believe a new cold war scenario is possible, while 48 percent said it was unlikely or impossible, up from 37 percent and 44 percent respectively in 2009, according to the Russian Public Opinion Research Center. (RIA Novosti, 10.07.13).
Russians' attitude to the U.S. is gradually getting worse, according to a recent poll conducted by the independent pollster Levada Centre. When asked about the U.S. role in the modern world in general, 50 per cent of respondents said it was "generally negative" (the option was chosen by some 43 in 2012 and by 53 per cent of those polled in 2008). Some 10 per cent of the polled, the same as in 2012, estimated the U.S. role in the global politics as "generally positive.” (Interfax, 10.10.13).
Russia plans to test US food stamp program to help its poor. (Itar-Tass, 10.10.13).
An intravenous, highly addictive drug from Russia — one that can destroy tissue and blood vessels, turning skin greenish and scaly — may be showing up in the United States. (Washington Post, 10.07.13).

II. Russia news.

Domestic politics, economy and energy:

Prime Minister Dmitri Medvedev fired the general director of Russia's beleaguered space agency on Thursday as part of a shake-up that had been expected after a series of embarrassing rocket failures. (New York Times, 10.11.13).
The ownership of about 40 percent of all real estate properties in Russia is a complete mystery to the government, the Federal Tax Service said, creating a massive blind spot that could obstruct the Finance Ministry's proposal to bring in a tax on real estate. (The Moscow Times, 10.10.13).
Credit Suisse’s annual global wealth report discovered that 35% of Russia’s entire wealth now in the hands of just 110 people, according to the report. “Russia has the highest level of wealth inequality in the world, apart from small Caribbean nations with resident billionaires,” according to the report. (Wall Street Journal, 10.08.13).
Russia's central bank has taken a further step towards a free float of the rouble, by widening the band within which it allows the currency to fluctuate against a dollar-euro basket to a 7 rouble corridor. (Financial Times, 10.10.13).
Economic growth is set to pick up in China and Russia, as well as in major developed economies, according to the Organization for Economic Cooperation and Development's composite leading indicators. (Wall Street Journal, 10.09.13).
The International Monetary Fund warned in a report published Wednesday that Russia's economic model has exhausted itself and predicted that future growth will be constrained by negative demographic trends. (RIA Novosti, 10.09.13).
The Russian economy will stagnate if companies do not increase their labor productivity, which currently averages at 40 percent of that of the Fortune 500 Global companies, according to an annual ranking that Expert Rating Agency. (The Moscow Times, 10.10.13).
Russia’s deteriorating economic potential and dependence on oil exports have all but dashed Russia’s hopes for a better sovereign debt rating, said Standard & Poor’s senior director Kai Stukenbrock. (Wall Street Journal, 10.08.13).
The volume of Rosatom's total capital investments this year will reach 7 billion euros ($9.5 billion), said Pyotr Stepayev, the state atomic energy corporation's deputy director. (The Moscow Times, 10.09.13).
The 455,000 square kilometres of land abandoned in the part of the USSR that is now Russia has locked away an average of 42.6 million tonnes of carbon every year since 1990, according to the Russian Academy of Sciences. (New Scientist, 10.02.13).
The Constitutional Court ruled Thursday to allow people previously convicted of "serious and very serious crimes" to run for public office, in a move that may pave the way for opposition leader Alexei Navalny and former oil tycoon Mikhail Khodorkovsky to get into politics. (The Moscow Times, 10.10.13).

Defense:

The test launch of Russia’s newest intercontinental ballistic missile, code-named RS-26 Rubezh, could take place before the end of the year. RS-26 specifications are currently classified, but an unnamed missile industry expert cited by Vedomosti newspaper said the new missile would most likely be equipped with a new warhead and system to override missile defenses. (RIA Novosti, 10.03.13).
Russia is to increase annual spending on nuclear weapons by more than 50 percent in the next three years. In 2016, 46.26 billion rubles ($1.4 billion) is to be spent on Russia’s nuclear weapons systems, up from 29.29 billion rubles this year, according to the State Duma Defense Committee’s report on the draft federal budget for 2014-2016. (RIA Novosti, 10.08.13).

Security, law-enforcement and justice:

President Vladimir Putin has submitted a bill to the State Duma to merge the Supreme Arbitration Court into the Supreme Court, the Kremlin said on its website. At least seven Supreme Arbitration Court justices have resigned after the bill was submitted.(Moscow Times, 10.10.13).
Russian authorities have been busy making sure that SORM (electronic surveillance) equipment is properly installed in the Sochi region ahead of the Olympics. Conventional security measures will also be high at Sochi, with more than 40,000 police on duty, more than 5,000 surveillance cameras installed across the city and drones hovering overhead. The FSB has also purchased two sonar systems to detect submarines and protect the Olympics from a sea-launched terror attack. (Guardian, 10.06.13).
Russia’s Investigative Committee suggested in a statement Wednesday that in addition to facing piracy charges, which carry a maximum 15 year prison sentence, some Greenpeace activists may also be charged with drug offenses. (CSM, 10.09.13).
A court bringing piracy charges against a group of Greenpeace activists shows that Russia has an independent judiciary, President Vladimir Putin’s spokesman said Friday. (WSJ, 10. 04.13).
President Vladimir Putin's human rights adviser urged prosecutors to drop piracy charges against Greenpeace activists for an Arctic protest, saying it's as stupid as accusing them of raping the oil platform they scaled. (Bloomberg, 10.11.13).

Foreign affairs and trade:

Russia and the U.S. agree on how to eliminate chemical weapons in Syria, President Vladimir Putin said Tuesday after meeting U.S. Secretary of State John Kerry (Reuters, 10.08.13).
The U.S. and Russia Monday stressed their determination to help press ahead with a United Nations-brokered conference planned for mid-November. U.S. Secretary of State John Kerry and Russian Foreign Minister Sergei Lavrov also expressed their satisfaction with efforts to destroy chemical weapons in Syria. (Wall Street Journal, 10.07.13).
President Vladimir Putin and the Foreign Ministry demanded explanations from Dutch authorities Tuesday after reports surfaced that a Russian diplomat was beaten and detained in the Netherlands over the weekend. The Netherlands later apologized to Russia. (The Moscow Times, 10.08.13, RFE/RL, 10.09.13).
In the coming days Tehran, it appears, will officially abandon its demands for Russia to pay a penalty of $4.2 billion for non-delivery of the S-300 systems to Iran in 2010-2012. And Moscow will step up talks on renewing the S-300 contract. (Nezavisimaya Gazeta, 10.08.13).
The European Union on Thursday asked the World Trade Organization to rule that a recycling fee Russia places on imported cars violates international trade rules, in the first complaint against Russia since Moscow joined the Geneva-based arbiter of trade disputes in August 2012. (Wall Street Journal, 10.10.13).

Russia's neighbors:

Ilham Aliyev won a third term as Azerbaijan’s president, tallying 85 percent in the October 9 vote. The U.S. State Department has said that the election fell short of international standards. Baku had hoped to project a tech-savvy image by launching a new mobile-phone application that allows voters to keep track of the election process. But the initiative seems to have backfired, with the application releasing what appears to be the final results -- which gave Aliyev a landslide victory -- one day before the election. (RFE/RL, Bloomberg, 10.10.13).
President Vladimir Putin said Tuesday that Russia had given Ukraine a huge discount on natural gas supplies, but that it might lose that privilege if it turned toward the European Union. (The Moscow Times, 10.08.13).
Ukraine may stop all natural gas imports from Russia within the next few years if the current gas contract is not reviewed, Prime Minister Mykola Azarov said Thursday. Later the same day a spokesperson for Russian Prime Minister Dmitry Medvedev, warned that Kiev's attempts to review gas contracts would have consequences for Ukraine. (RIA Novosti, 10.10.13).
Russia may impose visas for Ukraine if the country goes ahead with its planned trade deal with the European Union, an aide to President Vladimir Putin said. (The Moscow Times, 10.10.13).
European diplomats appear close to negotiating the release of Yulia V. Tymoshenko, the former prime minister of Ukraine. The European Union has warned Ukraine it will have to free Tymoshenko if it wants to be sure of signing a key Association Agreement with the bloc in November. (RFE/RL, 10.11.13, New York Times, 10.09.13).
Ukrainian President Viktor Yanukovych is in Krakow to meet with with Polish President Bronislaw Komorowski to discuss Kyiv's prospects for signing an Association Agreement at an upcoming EU summit in Vilnius. (RFE/RL, 10.07.13).
Russia has suspended imports of Lithuanian dairy products. (The Moscow Times, 10.08.13).
Russia will resume the import of Georgian fruit that was banned in 2005 over sanitary concerns. (The Moscow Times, 10.10.13).
A court in Kazakhstan's city of Atyrau has sentenced nine local men to prison terms of between six and 23 years for their involvement in terrorist activities. (RFE/RL, 10.10.13).

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