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Press Release

Russia in Review

Published: November 21, 2012

Russia in Review: a digest of useful news from U.S.-Russia Initiative to Prevent Nuclear Terrorism for 16-21, 2012

Russia in Review: a digest of useful news from U.S.-Russia Initiative to Prevent Nuclear Terrorism for November 16-21, 2012

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

Nuclear security agenda:

  • Senator Richard Lugar announced that in September the CTR program supported the disposal of four submarine-fired ballistic missiles and 161 metric tons of chemical nerve agents. (GSN, 11.20.12)

o   The program also assisted in the protection of six nuclear weapons train shipments and the completion of five biological agent monitoring sites.

 

Iran nuclear issue:

  • Senior diplomats from the U.S., Russia, China, France, the UK and Germany met in Brussels to consider new negotiating tactics with Iran, and agreed to seek another round of talks as soon as possible. (Reuters, 11.21.12)

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

  • No significant developments.

Missile defense:

  • Russia’s Foreign Minister Sergei Lavrov said he received confirmation during his meeting with Secretary of State Clinton in Cambodia that the Obama administration will work toward a deal on missile defense. (ITAR-Tass/GSN, 11.20.12)
  • Deputy Foreign Minister Ryabkov said he was optimistic that “we will be able to get the ball rolling again” on missile defense, but the U.S. “should meet us halfway” on two fundamental points:

o    “First, we need legal guarantees that what is happening in this sphere will not have a negative impact on the Russian nuclear deterrent potential. Second, we need some mechanism with the help of which we would independently verify whether these statements are true.” (GSN, 11.19.12)

  • According to an unnamed military source, Russia will deploy new ICBM in 2014, as “part of a response program to the United States ballistic missile defense program”. (GSN/RIA Novosti, 11.21.12)

Nuclear arms control:

  • No significant developments.

Counter-terrorism cooperation:

  • No significant developments.

Cyber security:

  • No significant developments.

Energy exports from CIS:

  • Norway’s Statoil is challenging Gazprom with new gas pricing in Europe. Statoil signed a 10-year gas supply deal with Germany’s Wintershall, based on spot gas prices while Gazprom insists on oil-linked prices despite EU opposition. (Reuters, 11.20.12)
  • Gazprom rival Novatek has asked for an exception to Gazprom’s monopoly on gas exports for its Yamal LNG project, whose output is earmarked for Asia, in attempt to break Russia’s dependence on Europe’s declining market. (Reuters, 11.20.12)

Access to major markets for exports and imports:

  • The U.S. House of Representatives voted to repeal the 1974 Jackson-Vanik trade restrictions that denied Russia PNTR, but passed the Magnitsky Act creating new rules linking trade and human rights. (Washington Post, 11.18.12)

o   The Magnitsky Act would allow the U.S. to deny visas to those involved in human rights abuses and freeze their assets. Russia vowed a “tough” response against what it called “an aggressively unfriendly, provocative insult.”

  • Putin: “The current situation of global markets is characterized by low demand and low investment activity, and therefore there is a risk that we’ll be unable to get quick positive results from our accession to the WTO.”  (RIA Novosti, 11.21.12)

Other bilateral issues:

  • After talks with Hillary Clinton in Cambodia, Russian Foreign Minister Lavrov said they had not reached a mutually-agreeable position on Syria. (RIA Novosti, 11.20.12)
  • During meeting with Lavrov, Clinton confirmed that President Obama hopes to make an official visit to Russia next year. (ITAR-Tass, 11.20.12)
  • Russia’s UN ambassador Vitaly Churkin accused the U.S. of blocking a bid by the UNSC to condemn the escalating violence in Gaza. (Washington Post, 11.19.12)
  • The U.S. Department of Justice denied an extradition request for convicted arms dealer Viktor Bout to Russia. Russia’s Foreign Ministry said the rejection was over a “formality” coupled with a set of “illegitimate pretexts”. (RIA Novosti, 11.19.12)

II. Russia news.

 

Domestic Politics, Economy and Energy:

  • Slower retail sales growth in Russia in October - 3.8% compared to 4.4% in September - has added to concerns about an economic slowdown. (Reuters, 11.20.12)

o   HSBC’s chief Russia economist Morozov: “the numbers…came less than expected, showing that the annual growth of the economy keeps decelerating.”

Defense:

  • During a visit to Beijing, Defense Minister Sergei Shoigu indicated Russia’s continuing interest in strengthening military ties with China. This was Shoigu’s first official foreign trip since replacing Serdyukov. (RIA Novosti, 11.21.12)
  • A preliminary agreement was reached for Russia to sell 24 SU-35 fighter jets to China’s Air Force for more than $1.5 billion. (Vedomosti/Voice of Russia, 11.21.12)

Security and law-enforcement:

  • An improvised bomb went off in Dagestan, killing two policemen and one civilian and wounding five others. (Reuters, 11.21.12)
  • A new law comes into force obliging NGOs that receive foreign funding and are involved in loosely defined political activities to register as foreign agents and subjecting them to increased tax scrutiny. (Bloomberg, 11.19.12)

o   Dozens of groups are boycotting the law, saying it would help the Kremlin stifle critics with fines and inspections of NGOs, and would allow the authorities to effectively paralyze an organization with endless checks.

  • Russian police searched the homes of Alexander Provotorov, head of $12 billion state telecoms firm Rostelecom, and of minority shareholder Konstantin Malofeyev in a fraud probe. (Reuters, 11.20.12)

o   Probes into top Russian firms may unsettle investors and are seen by some as settling of political and business scores.

  • Russian opposition and human rights groups urged Western consumer products giants to stop “financing politically motivated persecution” by advertising on pro-Putin TV channel NTV. (Associated Press, 11.19.12)

Foreign affairs:

  • During her visit to Moscow, German Chancellor Angela Merkel engaged in a sharp exchange with President Putin in the Kremlin. They clashed over human rights and democracy and struggled to show a united front. (The Wall Street Journal, 11.16.12)

o   When Merkel took up the cause of the protest group Pussy Riot, Putin responded that she shouldn’t support anti-Semites, referring to an earlier public performance involving one of the jailed women.

o   Merkel voiced disapproval of Russian political trends and Putin offered quick retorts, but both made clear they wanted to avoid undermining the business relationship, which exceeds $80 billion in annual trade.

Russia’s neighbors:

  • Moldovan President Timofti turned down Russia’s proposal to open a consulate in Transdniestria until Moscow pulls out its troops and an end to the dispute is negotiated; Russian Deputy PM Rogozin criticized Moldova’s energy policy and its rapprochement with the EU. (Reuters, 11.17.12)