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RA’s Daily Russia News Blast – May 12, 2020

Today in Russia: Peskov hospitalized with COVID-19; Yandex: from Russia’s “Google” to its “Amazon”; Russia world’s second-most infected; FT analysis finds death toll from COVID-19 may be 70% higher, Deputy PM responds; Russian government left “rudderless”; Rosneft ownership in Vedomosti revealed; Fire caused by ventilators in a hospital in St Petersburg leads to deaths of coronavirus patients; Bosov death investigation; Russian car sales plunge 72%; Ukraine’s Central Bank accuses Russia of violations in Sberbank sale

Kremlin Spokesman Dmitry Peskov announced he was diagnosed with COVID-19. He has been hospitalized. Peskov is only the latest official to succumb to the virus. Culture Minister Olga Lyubimova, Construction Minister Vladimir Yakushev and Prime Minister Mikhail Mishustin have announced they tested positive for the virus. Putin’s first deputy chief of staff Sergei Kiriyenko also reportedly came down with COVID-19 in April.

Tech giant Yandex’s primary sources of revenue are through online advertising and its ride-hailing business. However, the coronavirus pandemic has brought delivery services to the forefront for the company and may even lead to a longer-term transformation of the company. The Financial Times wrote that Yandex has become an “Amazon-like quasi public service,” and Yandex CEO Greg Abovsky was quoted saying, “This obviously will sound super ballsy/arrogant, but we potentially have an opportunity to build a FedEx in the space of a few months.”

Russia became the world’s second-most infected country [in Russian] in the world after the United States, with 232,243 reported cases.

An analysis conducted by the Financial Times found that the death toll in Russia may be 70 percent higher than official figures, writing, “The Financial Times’ analysis of all-cause mortality data in Moscow, the capital, and St Petersburg, Russia’s second-largest city, found 2,073 more deaths in April relative to the historical average of the previous five years. Official Covid deaths in the two cities came to just 629 for the same period, leaving 1,444 deaths in excess of normal mortality levels unaccounted for. If added to the reported national figure of 2,009 Covid deaths as of Monday morning, this would mean a 72 per cent increase in Russia’s national death toll.”

Russia’s Deputy Prime Minister Tatyana Golikova responded to the FT’s report [in Russian], stating that “We have never manipulated official statistics. Mortality statistics for the main reasons are published monthly in the Russian Federation. Such statistics for April will be at the end of May, but we have operational data. On average, in the Russian Federation, the mortality rate from a new coronavirus infection is 7.6 times lower than [global average], in Moscow this figure is 6.8 times lower than the rest of the world.”

The Russian government is left “rudderless” during the coronavirus epidemic. Mikhail Mishustin took over as Prime Minister in January with a mandate to “spearhead a push for stimulus spending to help Russia’s president remain in power.” But now, with Mishustin handing the reins to Andrei Belousov as he is hospitalized with COVID-19, “there is no longer the money to spend, nor Mr Mishustin to spend it.” For Belousov, his new task “borders on the impossble. Suppress the world’s second-fastest growing rate of coronavirus infections while also lifting a six-week-long national lockdown that has paralysed the economy. Fail, and further dent public support for the president, whose approval ratings fell last month to a record low in his 20 years in power.”

A multi-outlet investigation conducted by Vedomosti, Meduza, The Bell, and Forbes Russia [all in Russian] found that Vedomosti is controlled by Rosneft through debt. “Rosneft’s Russian Regional Development Bank (RRDB) has since 2017 owned 24.2 million euros of debt held by BNM, the joint-stock company that owns Vedomosti, according to the joint investigation by Vedomosti, Forbes Russia and news websites Meduza and The Bell. Former Vedomosti owner Demyan Kudryavtsev’s investment company reportedly took out the 24.2-million-euro loan from state-run Gazprombank to buy BNM in 2015 before the loan came under RRDB’s ownership.” The revelation comes after concerns about censorship has been brewing for the past two months.

A fire in a St Petersburg hospital was caused by a ventilator catching fire [in Russian]. It resulted in the death of five coronavirus patients. The ventilators were manufactured by UPZ, part of state-owned Rostec. On May 9, a similar incident took place at a hospital in Moscow with a ventilator from the same factory [in Russian]. UPZ is currently producing 10 ventilators per day and half of its ventilator production is exported.

An investigation into the death of billionaire Dmitry Bosov will look into two lines of inquiry: suicide and mishandling of weapons. Murder is not currently being investigated as a possible cause of death. Citing sources involved in the investigation, RBC reported [in Russian] that “According to [the source], the investigator interviewed the inner circle of the businessman and found that Bosov periodically violated the rules for handling weapons. ‘Some time ago, a random shot was fired from a pistol that was found next to the body, then, fortunately, no one was hurt,’ the source said. The investigator also interrogated the guards and studied the video from the surveillance cameras, the interlocutor added.”

Sales of automobiles in Russia plunged by 72 percent in April, a record. Reuters wrote, “Just 38,922 new cars and light commercial vehicles were sold in Russia in April, which saw the biggest monthly sales fall ever recorded by AEB after a 4% rise the previous month.

Ukraine’s Central Bank said that the sale of a majority of shares in Sberbank from the Russian Central Bank to the Ministry of Finance violated Ukrainian law [in Russian]. Sberbank’s Ukrainian subsidiary, Sberbank JSC underwent a change in ownership as a result of the sale, and the Ukrainian authorities said that three violations took place: It did not inform the Central Bank three months before the “acquision of a substantial share in Sberbank JSC”; it did not come to an agreement with the Central Bank on the change in ownership; and it did not submit a copy of the agreement to the Central Bank relating to the transfer of ownership.

PHOTO: Kremlin Spokesman Dmitry Peskov was diagnosed with coronavirus and hospitalized (Mikhail Metzel/TASS).