RA’s Daily Russia News Blast – Dec. 18, 2007


Today: United Russia party congress: Putin to accept premiership if Medvedev becomes president; SPS leader resigns; Russia threatens to target two proposed American bases in Europe with nuclear missiles; ArcelorMittal to move into Russia; Severstal to cut greenhouse gas emissions; Bush supports nuclear fuel delivery to Iran; Gazprom continues to dominate business news.

In an announcement that has “baffled many analysts”, Vladimir Putin has said he would accept the job of prime minister next year if Dmitri Medvedev became Russia’s next president. The strategy, announced at the United Russia party congress this week, is “risky, and could cripple Medvedev’s presidency.” While Putin says that there would be no redistribution of authority, one analyst commented that “de facto there will almost certainly be a change, simply because the prime minister will be Vladimir Putin.” Medvedev’s lack of connections with the Federal Security Services (FSB) “creates a whole series of problems regarding his chances of becoming the next president.”

United Russia has passed some new resolutions related to the party’s organization and personnel in order to “consolidate gains”. The Union of Right Forces (SPS) has put forward Boris Nemtsov, member of the party’s Political Council, as their presidential candidate. The party’s leader, Nikita Belykh, tendered his resignation at a party congress this week, after the poor performance of SPS in the elections. “I understand the full scope of the responsibility I bear for the failure of the party at the parliamentary elections and I am resigning,” he said. Rising inflation has given Russian agriculture a much-needed boost.Oleg Shvartsman’s assertion that the FSB has been involved in Russian business “has generated debate over the appropriate corporate role for spies and ex-spies”. ArcelorMittal, the world’s largest steelmaker, will spend an initial $100 million building its first new steel plant in Russia to feed the country’s booming construction industry. Russian energy giant Gazprom has invested $1.2 billion in the development of northwest Siberia’s Yuzhno-Russkoye oil and gas deposit. Russia and Germany both launched work on the enormous field, which will be jointly developed to feed the Nord Stream gas pipeline from Russia to Western Europe. German-based utility E.On said Monday that it had made “major progress” in talks with Gazprom aimed at giving E.On a stake in a Tomsk region gas field. The chief executives of Gazprom and BP have held talks on the companies’ stalled deal over the Kovykta gas project, as well as potential international cooperation. South Korea’s Hyundai Heavy Industries has launched a new 104,000-dwt tanker ordered by Russia’s Primorsk Shipping Corporation. Russia’s Sistema is developing plans to create a pan-Indian telecoms operator. The steelmaker Severstal has borrowed 300 million euros ($436 million) from the European Bank for Reconstruction and Development in order to fund a program to cut greenhouse gas emissions.In an “escalation of the Cold War-style threats favoured by President Vladimir Putin,” Russia has threatened to target two proposed American bases in Europe with its nuclear missiles if the Pentagon pressed ahead with its plans for a missile defence shield. “I do not exclude the missile-defence shield sites in Poland and the Czech Republic being chosen as targets for some of our intercontinental ballistic missiles,” said General Nikolai Solovtsov. Greek Prime Minister Kostas Karamanlis will meet with Putin during his visit to Moscow to discuss the construction of the Burgas-Alexandropolis oil pipeline, the South Stream gas pipeline linking Russia with Europe, and weapons. A new World Bank report comparing the size of the economies of 146 countries based on purchasing power parity has ranked Russia eighth. US President George Bush will support Russia’s delivery of nuclear fuel to Iran’s Bushehr plant, provided Moscow retrieves the used reactor fuel for reprocessing.The investigating committee of the RF Prosecutor General’s Office has added 5,000 sheets of financial documents and evidence records to the case opened against Mikhail Khodorkovsky and Platon Lebedev, the former owners of Yukos.(PHOTO: With President Vladimir Putin in the background his longtime protege Dmitri Medvedev speaks during a United Russia party congress in Moscow, Monday, Dec. 17, 2007. (AP Photo/Ivan Sekretarev))