Russia in Review

A digest of useful news from U.S.-Russia Initiative to Prevent Nuclear Terrorism for the week of May 21-27, 2011

I. Highlights of 05.26.11 meeting of U.S. President Barack Obama and Russian President Dmitry Medvedev in Deauville, France

Missile defense – joint threat assessment completed, but no agreement on actual cooperation and no rush to agree until 2020:

Factsheet released by the White House after the meeting says the Joint U.S.-Russia Report on Assessment of 21st Century Missile Challenges, which was outlined in joint statements of President Obama and President Medvedev dated April 1 and July 6, 2009, is “finished,” but no details on contents have been released.
Obama said: I and Medvedev are "committed to working together so we can find an approach and configuration that is consistent with the security needs of both countries... that maintains a strategic balance and deals with potential threats we both share." (Whitehouse.gov, 05.26.11).
Medvedev said: "I have told my counterpart, Barack Obama, that this issue will be finally solved in the future, like, for example, in the year 2020, but we, at present, might lay the foundation for other politicians' activities.” “This would be a sound foundation for cooperation between our two countries in the future." (Whitehouse.gov, AFP, 05.26.11).
Special Assistant to the U.S. President Michael McFaul put the problem plainly after the meeting with the Russians: "They don't believe us.”This is a very hard issue. There’s a lot of old thinking in both of our governments, frankly." (Wall Street Journal, AP, 05.26.11)
McFaul, in a frank description of the meeting, said Medvedev saw it this way: ‘“We don’t know what your technological capabilities will be in 2020.”’The president’s advisor continued: “We respond to that, ‘Yes, we can’t freeze technology. ‘A,’ we’re not going to do that, and ‘B,’ that’s not in our national interest.”’ (AP, 05.27.11).
Obama has argued that the system now being considered would be incapable of bringing down a sophisticated Russian inter-continental missile or jeopardizing its thousands of warheads.“It’s not just a question of intent,” said one key Obama advisor. “It’s a question of physics.” (AP, 05.27.11).
Medvedev’s foreign policy aide Sergei Prikhodko said ahead of the meeting: “To those who are telling scare stories about a new spiral of confrontation I would advise to display greater patience.” On New START: "I do not agree that the implementation of the agreement is stalled.” (Itar-Tass, 05.25.11).

Joint Statement on Counterterrorism Cooperation

The two presidents signed the statement, which calls for the following new measures:

o "strengthen security in airports serving our two countries and enhance cooperation on other modes of transportation."

o "improve in-air security through the deployment of law enforcement personnel on select flights, state-of-the-art in explosives detection measures, and how we can work together in multilateral organizations to improve global supply chain security."

o U.S. is offering reward of up to $5 million to anyone who helps locate Doku Umarov, Russia's most wanted Islamist rebel leader and leader of Imarat Kavkaz. (AFP, 05.26.11).

Joint Report by the Coordinators on Progress of the U.S.-Russia Presidential Commission

The two presidents hailed the report, which says:

“We believe that further development of our cooperation to strengthen nuclear security should remain a priority.”HEU retrieval and conversion of reactors to LEU, MPC&A, best practices, and emergency response.
“Following last-summer’s inaugural joint counter-hijacking exercise, ‘Vigilant Eagle,’ we also agreed to strengthen operational coordination to combat terrorist threats, which led to the signing of a Memorandum on Counterterrorism Cooperation last May, as well as joint nuclear security and crisis mitigation-type planning.”
“We also agreed to begin joint efforts to counter improvised explosive devices.”
“We have concluded preparation of a joint report assessing 21st century missile challenges.” “Channels have been opened between our defense policy experts on issues such as missile defense; defense reform; defense technology; logistics; and training, education, and human resources.”
In total, 67 events, exchanges, exercises, and consultations between our armed forces are planned for 2011.
More than 170,000 U.S. personnel have been transported via Russian airspace to Afghanistan.
One ton of heroin was seized in Afghanistan and drug smuggling rings between the U.S. and Russia have been dismantled.

Russia’s entry into World Trade Organization

Obama expressed confidence that Russia will succeed in its efforts after the meeting, which was dominated by WTO issue. "Much of our discussion today revolved around economics,” he said. (Whitehouse.gov, 05.26.11).
McFaul said: "The way the U.S. government sees it, this is an issue that could be done this year.” (Wall Street Journal, 05.26.11).
A senior White House official told ABC News after the meeting that Obama has "personally been engaged in" the issue for months, and actually set up the Swiss negotiations and convinced both the Russian and Georgian leaders to attend. (Foreign Policy, 05.26.11).

Joint Statement Regarding Cooperation on Visa Issues

The two presidents signed the statement which says:

eligible business travelers and tourists would be issued with visas valid for 36 months at a unified and reciprocal fee
government officials would also be eligible to receive 12-month multi-entry visas.

(Whitehouse.gov, RIA Novosti, 05.26.11).

The two presidents established Working Group on Innovation to be chaired by Under Secretary of State for Economic Affairs Robert Hormats and Presidential Advisor Arkady Dvorkovich and Working Group on Rule of Law to be chaired by Russian Minister of Justice Alexander Konovalov and U.S. Attorney General Eric Holder. (Whitehouse.gov, RIA Novosti, 05.26.11).

The two presidents and the leader of France Nicolas Sarkozy signed a Joint Statement on the Nagorno-Karabakh Conflict that says conflict can be resolved through peace only, but also notes that "further delay would only call into question the commitment of the sides to reach an agreement."

The two presidents signed the Joint Statement on Cooperation in the Bering Strait Region

enhanced contact between the government agencies responsible for the specially protected natural territories in Alaska and Chukotka.
increased interaction and facilitated travel among the native peoples living in these two regions. (Whitehouse.gov, 05.26.11).

The two presidents hailed the Memorandum of Understanding on Smart Grid Cooperation: USAID's Deputy Assistant Administrator Hale announced that USAID and DOE signed a memorandum with Russian counterparts to cooperate with Russia on energy efficiency and smart grids. (PR Newswire, 05.26.11).

The two presidents hailed Agreements Deepening U.S.-Russia Coordination on Health Issues, including Joint Protocol of Intent on Global Polio Eradication and subsequent polio immunization and monitoring missions carried out in Central Asia and Memorandums of Understanding furthering cooperation in fields of vital importance to the U.S. and Russia, including Biomedical Research and HIV/AIDS Research.

The two presidents also discussed Iran, Afghanistan, the Arab Spring, Middle East peace, and the global economy. (Wall Street Journal, 05.26.11).

II. U.S. and Russia priorities for the bilateral agenda.

Nuclear security agenda:

See highlights of 05.26.11 meeting of Obama and Medvedev.

Iran nuclear issues:

No significant developments.

NATO-Russia cooperation, including transit to Afghanistan:

See highlights of 05.26.11 meeting of Obama and Medvedev.

Counter-terrorism cooperation:

See highlights of 05.26.11 meeting of Obama and Medvedev.

Missile defense:

Russia is seeking assurances from NATO that any missile defense system the military alliance deploys in Europe will not be directed against the country. “We do not want any missiles aimed at Russia,” the foreign minister, Sergey V. Lavrov, said. He said establishing Russia-NATO antimissile cooperation was an "absolutely concrete practical test" to determine if the two former antagonists could collaboratively create an "undivided" security regime for Europe. (New York Times, 05.21.11, GSN, 05.23.11).
Also see highlights of 05.26.11 meeting of Obama and Medvedev.

Nuclear arms control:

President Obama could veto fiscal 2012 defense authorization bill if it retains amendments that would restrict his administration's ability to the New START, the White House said in a statement released on Tuesday. (GSN, 05.25.11).
Medvedev’s foreign policy aide Prikhodko said of New START: "I do not agree that the implementation of the agreement is stalled.” (Itar-Tass, 05.25.11).
Also see highlights of 05.26.11 meeting of Obama and Medvedev.

Energy exports from CIS:

Turkmenistan is likely sitting on top of the world's second-largest gas field, British energy auditor Gaffney, Cline & Associates said Wednesday. The company said the vast South Yolotan field covers an area of about 3,000 square kilometers (1,160 square miles) — bigger than the country of Luxembourg. (AP, 05.25.11).

Access to major markets for exports and imports:

Also see highlights of 05.26.11 meeting of Obama and Medvedev.

Other bilateral issues:

Also see highlights of 05.26.11 meeting of Obama and Medvedev.

III. Russia news.

Domestic Politics, Economy and Energy:

Prime Minister Vladimir Putin pledged to set up an agency to support medium-sized businesses on Wednesday as the former Kremlin chief tries to garner support ahead of the March 2012 presidential election. (Reuters, 05.25.11).
Prime Minister Vladimir Putin has decided to run for the presidency next year, raising the possibility of a power struggle with his protégé Dmitry Medvedev, the incumbent Kremlin leader, say highly placed sources. Insiders familiar with both leaders said Mr Putin, who served eight years as president before becoming Prime Minister three years ago, had begun to lose confidence in Mr Medvedev's loyalty. (Sunday Times, 05.21.11).
Political uncertainty ahead of the 2012 presidential election is partly to blame for money leaving Russian assets, the Kremlin's chief economic adviser Arkady Dvorkovich said on Tuesday. With oil prices above $100 a barrel, Russia's central bank has registered $50.6 billion in net capital outflows over the past seven months for which data is available. (Reuters, 05.24.11).
Former Soviet President Mikhail Gorbachev criticized leaders who stay too long in power, urging Vladimir Putin, who may seek a third term as Russia's president next year, to abide by democratic principles. (Reuters, 05.25.11).
Billionaire Mikhail Prokhorov promised on Saturday to turn Right Cause into Russia's second-largest party in the country with a pro-business platform that would change the country's landscape over the next decade. (Moscow Times, 05.23.11).
"He (Putin) does not approve of that kind of admiration," Putin's spokesman Dmitry Peskov said by telephone of a nun-like sect in central Russia that thinks Vladimir Putin is the reincarnation of St. Paul, the apostle. (Reuters, 05.25.11).
An influential Islamic organization with offices across the country has been forced to close, highlighting a political struggle over the country's millions-strong Muslim population.
Representatives of the Islamic Cultural Center and analysts said a Supreme Court ruling upholding the center's closure was politically charged. (Moscow Times, 05.26.11).
Royal Dutch Shell PLC Chief Executive Peter Voser met Russia's top energy official Wednesday to discuss joint projects on Russia's Arctic shelf, the Black Sea and Sakhalin-3, but he said the company won't seek to swap shares with state oil champion OAO Rosneft. (Wall Street Journal, 05.25.11).
Russian Energy Minister Sergei Shmatko said Monday he doesn't expect BP PLC and OAO Rosneft to be able to revive their landmark strategic alliance after it was blocked by BP's existing Russian partners, but he said the two oil giants are continuing discussions. (Wall Street Journal, 05.24.11).
United Company RusAl will refinance its entire $11.3 billion of debt by as early as September, removing curbs bankers imposed on the world's largest aluminum producer during Russia's biggest corporate restructuring in 2009. (Bloomberg, 05.20.11).
Russia's biggest privately owned oil producer, OAO Lukoil Holdings, Thursday said net profit for the first quarter rose 72% on higher oil prices, but the company continues to struggle with falling output, which declined 4.1% from a year earlier. (Wall Street Journal, 05.26.11).

Defense:

Last Friday’s test-launch of a missile from the Barents Sea could be the first test of a new, modernized version of the Sineva submarine-launched ballistic missile. The missile that was launched from underwater position from the strategic nuclear submarine “Yekaterinburg” in the Barents Sea Friday May 20 was not a regular Sineva SLBM, but a modernized version called Layner. (Barents News, 05.25.11).
Russian Defense Minister Anatoly Serdyukov has ordered inspections in the Armed Forces to expose possible corruption of commanders. (Interfax-AVN, 05.26.11)
A fifth of Russia's state defense spending is stolen every year by corrupt officials, dishonest generals and crooked contractors, Russia's chief military prosecutor Sergei Fridinsky said in an interview published on Tuesday. "Every year more and more money is set aside for defense but the successes are not great," he said, adding that kickbacks and fictitious contracts were being used to defraud the state. Fridinsky did not give specific figures, but Russia has set more than 1.5 trillion rubles for national defense in its 2011 budget, indicating theft of more than $10 billion a year from the sector. (Reuters, 05.24.11).
Thousands of local residents have been evacuated after a fire at an ammunition depot in Russia's Republic of Bashkortostan caused a series of explosions. (RFE/RL, 05.26.11).

Security and law-enforcement:

No significant developments.

Foreign affairs:

G-8/G-20 Summit in Deauville, France

o Leaders of the Group of Eight want more stringent international rules on nuclear safety following the disaster at Japan's Fukushima plant, French President Nicolas Sarkozy said on Thursday. Nikolay Spassky, deputy chief of Russia's state nuclear company Rosatom, said countries using nuclear power should be forced by international law to meet IAEA nuclear safety standards. (Reuters, 05.26.11).

o Russia is ready to mediate in the Libyan crisis following a request from its partners in the Group of Eight, Deputy Foreign Minister Sergei Ryabkov said on Friday. The Group of Eight has called on Russia to mediate in the Libyan crisis, President Dmitry Medvedev's spokeswoman said on Thursday. (Reuters. 05.27.11).

o Russia believes Libyan leader Muammar Gaddafi should give up his rule and is prepared to help broker his departure, a senior Russian official said on Friday. (Reuters, 05.27.11)

o The Group of Eight leaders said on Friday they were "appalled" at the killing of peaceful protesters by Syrian authorities and demanded an immediate end to the use of force. (Reuters, 05.27.11).

Russia and France have reached a long-awaited agreement on a Russian purchase of four Mistral class helicopter carriers made by a French-led consortium, the two countries' presidents said on Thursday. (Reuters, 05.26.11).
French President Nicolas Sarkozy and Russian President Dmitry Medvedev announced French investment in ski resorts in the Russian republics of Dagestan, North Ossetia, Adygea and Karachayevo-Cherkessia on Thursday. Their statement also calls for developing beach resorts on the Black and Caspian seas. (AP, 05.26.11).
IMF executive directors who represent Brazil, China, India, Russia and South Africa have issued a joint statement of concern about remarks from top European officials that a European should succeed Dominique Strauss-Kahn as IMF director. (AP, 05.24.11).
Russia and Argentina have signed a memorandum on cooperation in the peaceful use of atomic energy that recognizes Rosatom as a possible supplier for a fourth Argentinean nuclear power plant. (World Nuclear News, 05.24.11).
Russia hosted representatives of rival Palestinian factions Fatah and Hamas on Monday and praised a power-sharing deal that U.S. President Barack Obama has called an "enormous obstacle" to Middle East peace. (Reuters, 05.23.11).
A week after talks with an envoy for Libyan leader Moammar Gadhafi, Foreign Minister Sergei Lavrov held talks with representatives of the country's opposition Monday. (Moscow Times, 05.24.11).
British Prime Minister David Cameron will visit Moscow in September, a Russian diplomat said on Wednesday, in a sign that relations damaged by the murder of a Kremlin critic in London in 2006 are improving. (Reuters, 05.25.11).
Iran spearheaded opposition on Monday to a U.S. and Russian-backed plan to postpone fixing a date to destroy the world's last known stocks of live smallpox virus. (Reuters, 05.23.11).

Russia's neighbors:

The United States Defense Department has paid for aerial drones to spot intruders, and for motion detectors as part of a classified project at a nuclear site in Kurchatov, Kazakhstan. The project aims to keep terrorists away from plutonium and highly enriched uranium that Western scientists fear could be used to build an improvised nuclear device. (New York Times, 05.21.11).
The Taliban has warned Kazakhstan that its decision to send troops to the NATO-led war in Afghanistan would have severe consequences and was not in its regional interest. (Reuters, 05.23.11).
Georgian riot police used teargas, water cannons and rubber bullets on Thursday to halt five days of demonstrations against President Mikheil Saakashvili, who blamed the unrest on Russia. The international human rights group Amnesty International has urged Georgia to investigate official violence against antigovernment protesters in the wake of a street riot that killed two police officers. (Reuters, 05.26.11, RFE/RL, 05.27.11).
Georgian President Mikheil Saakashvili believes Georgia could be a very useful ally to Russia, saying that normal relations between the two countries will become possible if Russia begins dialogue with the current Georgian administration. (Interfax, 05.20.11).
U.S. President Barack Obama has condemned the sentencing of five former presidential candidates in Belarus and vowed to pursue new sanctions against the regime of President Alyaksandr Lukashenko. The European Union also toughened its sanctions against Belarus on Monday. Lukashenko said on Wednesday he could free political opponents sent to prison this month following protests against his re-election last December. (Reuters, 05.25.11, RFE/RL, 05.27.11).
Russia, which hopes to buy more than seven billion dollars worth of Belarussian assets as it helps Minsk tackle a currency crisis, expressed opposition on Saturday to tougher European sanctions against Belarus firms. (Reuters, 05.21.11).
Tajikistan should engage with non-violent Islamic groups to avoid sliding toward conflict with a new generation of home-grown insurgents and fighters crossing back from Afghanistan, the International Crisis Group said. (Reuters, 05.25.11).
The European Union has pledged an additional 1.242 billion Euros ($1.746 billion) to countries in its immediate neighborhood over the next two years, but is tying aid to the pace of democratic reforms. (RFE/RL, 05.26.11).
The European Parliament has postponed a decision to upgrade the European Union's relationship with Turkmenistan until July and might even delay the process till the autumn. (RFE/RL, 05.26.11).
Ukrainian prosecutors on Tuesday charged former Prime Minister Yulia Tymoshenko with abuse of office for signing a gas import contract with Russia at prices that officials say were too high. (AP, 05.24.11).
The Armenian parliament has overwhelmingly approved a general amnesty that should lead to the release of virtually all opposition members currently in jail. (RFE/RL, 05.26.11).
Eynulla Fatullayev, a journalist and newspaper editor who had turned into one of the symbols of Azerbaijan's crackdown on freedom of expression, was released along with dozens of other inmates after being pardoned by Azerbaijan's President Ilham Aliyev. (RFE/RL, 05.26.11).