Russia 110328 Basic Political Developments

PRESS DIGEST - Russia - Mar 28

http://www.reuters.com/article/2011/03/28/press-digest-russia-mar-idUSLDE72R08K20110328
3:13am EDT

MOSCOW, Mar 28 (Reuters) - The following are some of the leading stories in Russia's newspapers on Monday. Reuters has not verified these stories and does not vouch for their accuracy.

KOMMERSANT

www.kommersant.ru

- Twenty seven percent of voters in the recent parliamentary elections believe that election results were doctored in favour of pro-Kremlin United Russia party, the daily cites an independent public opinion poll.

VEDOMOSTI

www.vedomosti.ru

- Key ministers and other state officials have to choose between meetings chaired by President Dmitry Medvedev or Prime Minister Vladimir Putin which often happen at the same time, the daily writes.

- The paper runs an interview with the chief executive of Ford Europe (F.N: Quote, Profile, Research, Stock Buzz), Stephen Odell, who says that sales at the Russian car market may reach 4-5 million cars in 2016 from 2.1-2.4 million in 2011

- The paper runs an interview with CEO of AvtoVAZ (AVAZ.MM: Quote, Profile, Research, Stock Buzz) Igor Komarov.

NEZAVISIMAYA GAZETA

www.ng.ru

- Almost 3,000 people protested last Saturday in the mostly Muslim Russian region of Tatarstan against plans to introduce fees for sport fishing, the daily says.

IZVESTIA

www.izvestia.ru

- Prices for all cars, except the Chinese-made, will grow due to the disaster in Japan, the daily writes citing experts.

ROSSIISKAYA GAZETA

www.rg.ru

- Russia's population shrunk 2.2 million in 2010 compared to 2002, which is 1.6 percent, the paper cites preliminary census results.

Russian Press at a Glance, Monday, March 28, 2011

http://en.rian.ru/papers/20110328/163241454.html
09:34 28/03/2011

POLITICS

President Dmitry Medvedev has urged U.S. President Barack Obama to help prevent civilian deaths in Libya, as Russia's NATO envoy warned that the U.S.-led military alliance could be dragged into a full-scale war.

(Moscow Times)

Officials from the Kremlin and Russia's White House have long split into those who support Prime Minister Vladimir Putin and President Dmitry Medvedev. Are there real contradictions between Putin and Medvedev?

(Vedomosti)

The European Commission will tightly control nuclear reactors even beyond its territory, for example in Russia, Commission President Jose Manuel Barroso said last week.

(Nezavisimaya Gazeta)

ECONOMY & BUSINESS

Cracks have begun to appear in a $16-billion tie-up between Rosneft and BP following a court decision blocking the deal.

(Moscow Times)

Moscow City Hall is establishing its own land operator.

(Kommersant)

The Audit Chamber disliked the Bank of Moscow's credit policy.

(Vedomosti)

Japan's disaster could cut the world car production by 30%.

(Vedomosti)

SOCIETY

Hazing in the military rose more than 16% last year, with ethnic tensions increasing, the chief military prosecutor said.

(Moscow Times)

Efforts to overcome the earthquake and tsunami in Japan could become an impetus for the country's residents for a powerful economic breakthrough.

(Rossiiskaya Gazeta)

SPACE

Israel and Russia have agreed to increase cooperation on space research and exploration.

(Moscow Times)

NUCLEAR

Small amounts of radioactive material from Japan's crippled Fukushima Nuclear Power Plant have reached North America. Russian experts say there are no reasons for panic for the United States or Europe.

(Kommersant)

Russian Site Smokes Out Corruption

http://www.nytimes.com/2011/03/28/business/global/28investor.html?_r=2&pagewanted=1&ref=global-home

By ANDREW E. KRAMER

Published: March 27, 2011

MOSCOW — Before the Internet, a Russian dissident might have hoped to reach dozens of sympathetic readers with a mimeographed samizdat publication of forbidden material.

But in today’s Russia, Aleksei N. Navalny has managed to attract a vast audience with his Web site for investors, Navalny.ru, even as he takes on big state-owned energy companies in his crusade against graft, kickbacks and bribery.

A 34-year-old real estate lawyer by training, Mr. Navalny can reach as many as a million unique visitors in a day with his digital samizdat, as happened last fall with his scoop about embezzlement at Transneft, a state-run pipeline company.

That scheme, presented as a cautionary tale for those tempted to invest in Russian energy stocks, described executives setting up a series of shell companies to pose as contractors for Transneft’s project to build a 3,000-mile pipeline to China. One shell, for example, was registered in the name of a Siberian man who had lost his passport, according to the Nalvany report.

The post included an audit indicating that the contracting fraud had cost Transneft $4 billion. Both Transneft and the government accounting office, whose documents Mr. Navalny said he leaked on his site, have denied the corruption claim.

But Prime Minister Vladimir V. Putin took the posting seriously enough to ask for an investigation, which is still pending.

Mr. Navalny, whose fame and unabashed political ambitions are surely helped by his blue-eyed good looks and acidic sense of humor, has clearly touched a nerve in Russian society. His blog appeals to Russians who wonder: if the country’s vast oil wealth is not trickling down to the public, where is it going?

“I do this because I hate these people,” Mr. Navalny said gleefully of his Web postings, which take aim at those he describes as the self-dealing managers in the oil and natural gas business.

Within Russia, Mr. Navalny’s celebrity “is growing almost as quickly as that of WikiLeaks founder Julian Assange,” Nikolai Petrov, a fellow at the Carnegie Moscow Center, a political affairs research group, wrote in December. Mr. Petrov wrote that Mr. Navalny “represents a new generation of political activists, one who sees the system’s vulnerabilities and targets his blows accordingly.”

A former activist in a liberal political party, Yabloko, Mr. Navalny says he will eventually run for public office. He now calls himself an advocate of the rights of members of the Russian middle class — people who have invested in the stock market and who he says are losing money to corruption and mismanagement.

Stock ownership here is tiny by the standards of the United States. Russians have opened 726,000 brokerage accounts, representing about 0.5 percent of the population.

But that number, and Mr. Navalny’s likely audience, is growing about 12 percent a month, according to Troika Dialog, a Moscow investment bank. Just as Americans seethed at wealthy bankers after the housing bubble burst, he said, Russians have started chafing at state company mismanagement during the oil boom.

“They see that Gazprom does not pay a dividend,” he said, “but the company parking lot is full of Mercedes-Benz cars.”

While potentially valuable to the owners of stocks and mutual funds, Mr. Navalny’s disclosures are not winning him friends in the executive suites of the country’s big energy companies.

The chief executive of Transneft, Nikolai Tokarev, a veteran of the Soviet K.G.B., has suggested that Mr. Navalny is a shill for the Central Intelligence Agency, ordered to smear the reputations of important Russian companies.

Nothing has followed from these charges so far. Mr. Navalny, though, became so unnerved that he gave his wife a list of phone numbers to call if he disappeared — other lawyers, journalists and opposition politicians.

“They could arrest me at any moment,” Mr. Navalny explained.

Indeed, after the Transneft documents were published, the government opened a criminal investigation against Mr. Navalny. It nominally has nothing to do with his Transneft disclosures. Instead, it involves his supposedly giving bad investment advice to a regional government several years ago, when he worked as an adviser to a local governor. That investigation, too, is still pending.

After the pipeline audit leak, men who identified themselves as security agents contacted clients of Mr. Navalny’s law practice, warning them against doing business with him, Mr. Navalny said.

Mr. Navalny has held down his day job as a real estate lawyer alongside his prolific online writing. He got his start in 2007 by suing Russian companies to force disclosure of accounting documents, using his standing as a minority stockholder owning a few shares. He would then publish the disclosures on a LiveJournal blog, eventually building up a following. He started Navalny.ru last year.

He has fans among Moscow financial analysts and bankers, in particular.

“I’ve been very successful, and I’m grateful,” said one Moscow banker, who asked to be identified only by his first name, Vladimir, given the controversy around Mr. Navalny. “Now I’d like to make this country a better place.” The banker said he discreetly volunteered to help Mr. Navalny analyze financial documents.

The Transneft controversy has only heightened interest in Mr. Navalny’s blog. He has since branched out from shareholder activism, creating RosPil.info, a new Web site about corruption in the government procurement process. It posts documents about state tenders and asks for public input on matters like the fairness of the prices or the deadlines.

It is a pioneering experiment in crowd-sourcing what had traditionally been investigative journalism, in a country where that type of journalism is repressed. The site is financed with online donations, using a Russian analogue to PayPal.

“I’m not just saying, ‘Here are the corrupt bureaucrats,’ ” Mr. Navalny said. “I offer solutions.”

Like Navalny.ru, RosPil.info makes for dense reading, but its popularity suggests a groundswell of of public anger.

“The middle class hates corruption,” Mr. Navalny said. “If you tell a grandmother in a village the state oil company stole $1 billion, she won’t understand. But somebody who owns stock in that company certainly will.”

The new site’s name means Russian Saw. It features an image of the fierce-looking two headed Russian eagle — the state symbol — absurdly grasping two carpenter saws in its talons.

Why saws? Russian slang for taking a kickback is to “saw off” a piece of the contract. Mr. Navalny has helped make the saw a symbol of this discontent — a twist on the peasant mob’s pitchfork, for a contemporary Russian audience.

The site explains why Russians should volunteer their time to read the tender documents: “Because pensioners, doctors and teachers are on the edge of survival, while scoundrels in power buy another villa, yacht or the devil knows what.”

28 March 2011 Last updated at 04:06 GMT