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The Russian PM should embrace his Abba-loving side – in a global downturn, his country needs all the kitsch it can handle
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By Jason Corcoran
Claims that Vladimir Putin is a secret Dancing Queen are causing a sensation in Moscow.
The prime minister's press office has denied that the judo-loving, tiger-hunting all-action hero is a closet Abba fan, following a private concert given by the tribute band Björn Again. Putin's personal spokesman Dmitry Peskov also took the unusual step of writing to the Times to reiterate the point.
But the Kremlin has been far too hasty in trying to suppress this story. Russians would warmly embrace their leader's softer musical side in a crucial year, as the capital prepares to host the ultimate celebration of kitsch for the very first time.
Russia and the Slavic nations take Eurovision very seriously and are tremendously proud of Dima Bilan's achievement in winning last year in Belgrade.
Bilan, a heartthrob throughout Russia and the Commonwealth of Independent States (CIS), won following an audacious performance that was accompanied by Olympic figure-skating champion Eugeni Pluschenko who skated during the performance, and violinist Edvin Marton playing a rare 1697 Stradivarius, once used by Paganini.
Sporting and cultural achievements, much more than peak oil prices and military incursions, have restored Russians' pride in their country.
The unprecedented outpouring in June last year of an estimated 700,000 football fans onto the streets of Moscow, following Russia's trouncing of the Netherlands indicates how much they care about national triumph through sport.
Russians deeply appreciate classical and popular music in its different forms. Glamour and showbiz are exalted and Moscovites will embrace Eurovision for all its tackiness and absurdity.
With global prices of oil, Russia's chief export, now dropping, there's less money swishing about to lavish on recreation and sport.
Uefa Cup champions Zenit St Petersburg, sponsored by energy giant Gazprom, recently sold Russia's star Andrei Arshavin to London's Arsenal.
Other domestic clubs are feeling the pinch with Moscow's Khimki having to merge with FC Saturn to save costs. The national football team's manager, Guus Hiddink, was this week been hired as the Chelsea's latest manager, following reports he hasn't been paid by Russia for two months.
Staples of Moscow's cultural life such as attending the ballet, the theatre or musical performances are becoming more inaccessible, with inflation remaining defiantly high and job losses spreading across the economy.
By May, social morale in the country might need a shot-in-the-arm.
The UK has the theatrical impresario and composer Andrew Lloyd Webber as its main cheerleader and Russia needs its own Super Trouper so it can retain its crown in May.
Putin's protege, President Dmitry Medvedev, has made no secret of his affinity for British heavy rockers Black Sabbath and Deep Purple. Medvedev publicly attended the latter's concert last year and posed for thumbs-up photos with the band afterwards.
Putin, a former KGB officer, might be best advised to shed his macho image and show a fluffier, feathered-boad element to his steely facade. If the Russian rouble carries on sliding and commodity prices continue to languish, Putin could be forgiven for sending out a SOS.
The Eurovision in May could prove to be the Russian premier's Waterloo if discontent about the economy dents his undeniable popularity. Mamma Mia, I think Putin should unleash his inner Abba.
http://www.guardian.co.uk/commentisfree/2009/feb/13/russia-vladimir-putin
Showing posts with label President Vladimir Putin. Show all posts
Showing posts with label President Vladimir Putin. Show all posts
Monday, 16 February 2009
Thursday, 29 January 2009
Oligarchs beware
Guardian Unlimited
By Jason Corcoran
Vladimir Putin's denial that he is a 'billionaire-slayer' looks increasingly unconvincing
The Russian prime minister Vladimir Putin will have raised someeyebrows amongst west London's oligarchical clique by rebuffing his image as "a billionaire-slayer".
Putin has been wielding his power to lance the ambition of aspirational tycoons for almost a decade and is showing no signs of stopping now. In an interview with Bloomberg, the Russian leader insisted the country's rules and laws are a level playing field for all of its citizens.
Well, tell that to jailed oil tycoon Mikhail Khodorkovsky, who haslanguished in a Siberian prison since 2005 on back-dated charges of tax evasion in what many viewed as an attempt to silence a political opponent. A court rejected Khodorkovsky's parole request last year, citing reasons such as a refusal to take part in a sewing course.
Putin had told a meeting of oligarchs early in his reign in 2000 itwas either his way or the highway. Some of Russia's wealthiest and most prominent businessmen, such as Boris Berezovsky and Vladimir Gusinsky, were forced to flee Moscow soon after. The pair had controlled TV stations which were critical of Putin's leadership.
Magnates such as Chelsea football club owner Roman Abramovich and Viktor Vekselberg opted to play ball. The former agreed to sell his oil company Sibneft to state behemoth Gazprom while Vekselberg impressed by splashing out a fortune to repatriate Faberge eggs to the Kremlin.
The credit crisis has put the current crop of oligarchs under thespotlight as they strain to repay hefty foreign loans and respond to the Kremlin's call to chip in more taxes to help foot the national budget.
The founder of Russia's leading mobile phone chain, Yevgeny Chichvarkin, was last week reported to have fled to London after appearing on the federal wanted list. He is accused of being involved in the kidnapping and blackmail of a former employee in a case with political undertones. Chichvarkin is joined in exile by the former president of the oil company Russneft Mikhail Gutseriyev, who fled 18 months ago in order to avoid tax evasion and other charges. Russneft has since been acquired by Oleg Deripaska, who is considered to be Putin's favourite industrialist.
Putin has the financial wherewithal and the whim to decide which oligarchs survive. Vnesheconombank (VEB), the state development bank charged with bailing out troubled companies, is chaired by the prime minister. More than 100 businesses are believed to have gone cap-in-hand to VEB, which has dished out $1 billion to Evraz, the steel and mining group part-owned by Abramovich. Deripaska, once Russia's richest man, benefitted when VEB stepped in to refinance a $4.5bn loan that he had taken out to buy a 25% stake in the mining company Norilsk Nickel.
The credit crunch has also shown up the first cracks in therelationship between Putin and his protege Dmitri Medvedev, who replaced him as president last year.
Unlike his mentor, Medvedev has never been a member of the spying classes. A lawyer by training, he claims to want a strong independent judiciary to decide the fate of bent businessmen. He has twice subtly criticised Putin's government for its handling of the crisis but it remains to be seen whether the ruling tandem is wobbling from its course. Putin still controls the strings and Medvedev can only become the puppetmaster if he cuts them.
guardian.co.uk © Guardian News and Media 2009
By Jason Corcoran
Vladimir Putin's denial that he is a 'billionaire-slayer' looks increasingly unconvincing
The Russian prime minister Vladimir Putin will have raised someeyebrows amongst west London's oligarchical clique by rebuffing his image as "a billionaire-slayer".
Putin has been wielding his power to lance the ambition of aspirational tycoons for almost a decade and is showing no signs of stopping now. In an interview with Bloomberg, the Russian leader insisted the country's rules and laws are a level playing field for all of its citizens.
Well, tell that to jailed oil tycoon Mikhail Khodorkovsky, who haslanguished in a Siberian prison since 2005 on back-dated charges of tax evasion in what many viewed as an attempt to silence a political opponent. A court rejected Khodorkovsky's parole request last year, citing reasons such as a refusal to take part in a sewing course.
Putin had told a meeting of oligarchs early in his reign in 2000 itwas either his way or the highway. Some of Russia's wealthiest and most prominent businessmen, such as Boris Berezovsky and Vladimir Gusinsky, were forced to flee Moscow soon after. The pair had controlled TV stations which were critical of Putin's leadership.
Magnates such as Chelsea football club owner Roman Abramovich and Viktor Vekselberg opted to play ball. The former agreed to sell his oil company Sibneft to state behemoth Gazprom while Vekselberg impressed by splashing out a fortune to repatriate Faberge eggs to the Kremlin.
The credit crisis has put the current crop of oligarchs under thespotlight as they strain to repay hefty foreign loans and respond to the Kremlin's call to chip in more taxes to help foot the national budget.
The founder of Russia's leading mobile phone chain, Yevgeny Chichvarkin, was last week reported to have fled to London after appearing on the federal wanted list. He is accused of being involved in the kidnapping and blackmail of a former employee in a case with political undertones. Chichvarkin is joined in exile by the former president of the oil company Russneft Mikhail Gutseriyev, who fled 18 months ago in order to avoid tax evasion and other charges. Russneft has since been acquired by Oleg Deripaska, who is considered to be Putin's favourite industrialist.
Putin has the financial wherewithal and the whim to decide which oligarchs survive. Vnesheconombank (VEB), the state development bank charged with bailing out troubled companies, is chaired by the prime minister. More than 100 businesses are believed to have gone cap-in-hand to VEB, which has dished out $1 billion to Evraz, the steel and mining group part-owned by Abramovich. Deripaska, once Russia's richest man, benefitted when VEB stepped in to refinance a $4.5bn loan that he had taken out to buy a 25% stake in the mining company Norilsk Nickel.
The credit crunch has also shown up the first cracks in therelationship between Putin and his protege Dmitri Medvedev, who replaced him as president last year.
Unlike his mentor, Medvedev has never been a member of the spying classes. A lawyer by training, he claims to want a strong independent judiciary to decide the fate of bent businessmen. He has twice subtly criticised Putin's government for its handling of the crisis but it remains to be seen whether the ruling tandem is wobbling from its course. Putin still controls the strings and Medvedev can only become the puppetmaster if he cuts them.
guardian.co.uk © Guardian News and Media 2009
Sunday, 20 January 2008
Putin puts Russian sovereign wealth fund back on agenda
Financial News
Jason Corcoran in Moscow
21 January 2008
Analysts hope the vision of a Norwegian-style investment strategy will prevail
Plans are back on track to spin off a sovereign wealth fund from Russia’s $150bn (€101bn) oil reserves to invest in foreign stocks and bonds after President Vladimir Putin’s decision to nominate a successor, according to Moscow analysts.
The aim of Finance Minister Alexei Kudrin to set up a Norwegian-style future generations fund next month looked uncertain when Sergei Storchak, the minister responsible at the Stabilisation Fund, was arrested on charges of embezzlement, which he denies.
Concerns emerged after an Israeli fund manger said Kremlin officials had given him the go-ahead to conduct a “velvet reprivatisation” in strategic industries and suggestions the fund should pay off oil group Rosneft’s debt.
But Kudrin was bolstered last month when Putin nominated Dmitry Medvedev, a liberal reformer close to Kudrin, as his favoured presidential successor.
Yaroslav Lissovolik, chief economist of Deutsche Bank in Russia, said: “The Stabilisation Fund is the anchor of Russian macroeconomic policy. There has been some disagreement about its future but the changes in the top echelons of government have given me added conviction the Minister of Finance’s vision will prevail.”
The Stabilisation Fund will be divided into the Reserve and National Prosperity funds from February 1. The Reserve Fund, expected to total 10% of Russia’s GDP, will perform a similar role to the Stabilisation Fund, cushioning the federal budget in the event of an oil price plunge.
Oil and gas revenues above this limit will supplement budget spending and will go to the National Prosperity Fund, which could be seeded with between $25bn and $30bn.
This month the Finance Ministry said the Reserve Fund would follow the same investment rules as the Stabilisation Fund – with at least half going into developed countries’ sovereign bonds – but it is devising the Prosperity Fund’s investment strategy with other ministries and the central bank. While a detailed investment model has yet to be seen, finance ministry officials have indicated the fund will initially adopt a cautious approach.
A spokeswoman for the ministry said the fund would not immediately invest in foreign equity. She said: “The rules are not ready yet, due to a delay, but we will go ahead when they are.” She said the state prosecutors had extended the detention of Storchak until April 9.
Kudrin wants the investment structure of the Prosperity Fund to resemble Norway’s state pension fund, 60% of which is invested in stocks and 40% in bonds. He has suggested a special agency or a private asset management company might manage the fund’s assets.
The overhaul of the Stabilisation Fund has been a point of political contention and disagreement continues about how it should be used. Pressure has been increasing on Kudrin to loosen the purse strings ahead of the presidential elections but he has consistently voiced fears about irrational domestic spending, which could overheat the economy and further fuel inflation.
The Government wants to revitalise the country’s industrial base and diversify the economy from energy exports towards investing in high-technology projects. It has drawn $12.3bn from the Stabilisation Fund to seed investment in infrastructure projects and nanotechnology.
Funds from oil revenues have found their way into the Russian Venture Company, a state fund created in August to support start-ups. US venture capitalist group Draper Fisher Jurvetson, Russia’s VTB Asset Management and Israeli financial services group Tamir Fishman have entered into deals with the RVC. Under these arrangements, the firms will create a fund with their money and state money. By the end of next year, the RVC hopes to have alliances with between seven and nine more funds.
The RVC initiative suffered a setback when Tamir Fishman pulled out of the deal, following comments made by its Russian minority partner Oleg Shvartsman of fund manager Finans-Group. In an interview with Kommersant newspaper, Shvartsman said the Government had authorised him to acquire the assets of some firms and then give them to an asset management group on what he called “a voluntary-coercive basis”, which he described as “velvet reprivatisation”.
The Russians could learn from Azerbaijan how best to spend their oil riches. The former Soviet state set up the State Oil Fund of the Republic of Azerbaijan in 1999 to transfer the benefits of energy exports to future generations.
The fund’s assets are used to finance capital budget expenditure – particularly related to infrastructure – and projects aimed at stimulating small to medium enterprises, reducing poverty and addressing other social problems.
Its main source of revenue is income from oil contracts, including proceeds from the sale of profit oil, which account for about 75% of its annual revenues.
Katya Malofeeva, chief economist for Russia at Renaissance Capital, said: “So far, the inflow of oil revenues has been only a fraction of the expected total inflow as commercial oil only started flowing last year. The country expects to receive $150bn to $200bn in the next 20 years through existing projects.”
www.efinancialnews.com
Jason Corcoran in Moscow
21 January 2008
Analysts hope the vision of a Norwegian-style investment strategy will prevail
Plans are back on track to spin off a sovereign wealth fund from Russia’s $150bn (€101bn) oil reserves to invest in foreign stocks and bonds after President Vladimir Putin’s decision to nominate a successor, according to Moscow analysts.
The aim of Finance Minister Alexei Kudrin to set up a Norwegian-style future generations fund next month looked uncertain when Sergei Storchak, the minister responsible at the Stabilisation Fund, was arrested on charges of embezzlement, which he denies.
Concerns emerged after an Israeli fund manger said Kremlin officials had given him the go-ahead to conduct a “velvet reprivatisation” in strategic industries and suggestions the fund should pay off oil group Rosneft’s debt.
But Kudrin was bolstered last month when Putin nominated Dmitry Medvedev, a liberal reformer close to Kudrin, as his favoured presidential successor.
Yaroslav Lissovolik, chief economist of Deutsche Bank in Russia, said: “The Stabilisation Fund is the anchor of Russian macroeconomic policy. There has been some disagreement about its future but the changes in the top echelons of government have given me added conviction the Minister of Finance’s vision will prevail.”
The Stabilisation Fund will be divided into the Reserve and National Prosperity funds from February 1. The Reserve Fund, expected to total 10% of Russia’s GDP, will perform a similar role to the Stabilisation Fund, cushioning the federal budget in the event of an oil price plunge.
Oil and gas revenues above this limit will supplement budget spending and will go to the National Prosperity Fund, which could be seeded with between $25bn and $30bn.
This month the Finance Ministry said the Reserve Fund would follow the same investment rules as the Stabilisation Fund – with at least half going into developed countries’ sovereign bonds – but it is devising the Prosperity Fund’s investment strategy with other ministries and the central bank. While a detailed investment model has yet to be seen, finance ministry officials have indicated the fund will initially adopt a cautious approach.
A spokeswoman for the ministry said the fund would not immediately invest in foreign equity. She said: “The rules are not ready yet, due to a delay, but we will go ahead when they are.” She said the state prosecutors had extended the detention of Storchak until April 9.
Kudrin wants the investment structure of the Prosperity Fund to resemble Norway’s state pension fund, 60% of which is invested in stocks and 40% in bonds. He has suggested a special agency or a private asset management company might manage the fund’s assets.
The overhaul of the Stabilisation Fund has been a point of political contention and disagreement continues about how it should be used. Pressure has been increasing on Kudrin to loosen the purse strings ahead of the presidential elections but he has consistently voiced fears about irrational domestic spending, which could overheat the economy and further fuel inflation.
The Government wants to revitalise the country’s industrial base and diversify the economy from energy exports towards investing in high-technology projects. It has drawn $12.3bn from the Stabilisation Fund to seed investment in infrastructure projects and nanotechnology.
Funds from oil revenues have found their way into the Russian Venture Company, a state fund created in August to support start-ups. US venture capitalist group Draper Fisher Jurvetson, Russia’s VTB Asset Management and Israeli financial services group Tamir Fishman have entered into deals with the RVC. Under these arrangements, the firms will create a fund with their money and state money. By the end of next year, the RVC hopes to have alliances with between seven and nine more funds.
The RVC initiative suffered a setback when Tamir Fishman pulled out of the deal, following comments made by its Russian minority partner Oleg Shvartsman of fund manager Finans-Group. In an interview with Kommersant newspaper, Shvartsman said the Government had authorised him to acquire the assets of some firms and then give them to an asset management group on what he called “a voluntary-coercive basis”, which he described as “velvet reprivatisation”.
The Russians could learn from Azerbaijan how best to spend their oil riches. The former Soviet state set up the State Oil Fund of the Republic of Azerbaijan in 1999 to transfer the benefits of energy exports to future generations.
The fund’s assets are used to finance capital budget expenditure – particularly related to infrastructure – and projects aimed at stimulating small to medium enterprises, reducing poverty and addressing other social problems.
Its main source of revenue is income from oil contracts, including proceeds from the sale of profit oil, which account for about 75% of its annual revenues.
Katya Malofeeva, chief economist for Russia at Renaissance Capital, said: “So far, the inflow of oil revenues has been only a fraction of the expected total inflow as commercial oil only started flowing last year. The country expects to receive $150bn to $200bn in the next 20 years through existing projects.”
www.efinancialnews.com
Monday, 10 December 2007
Warnig steps down from Dresdner board
Financial News
Jason Corcoran in Moscow
10 December 2007
German banker Mattias Warnig has stepped down from the board of Dresdner Kleinwort in Russia to concentrate on leading the construction of Gazprom’s natural gas pipeline to Germany.
Warnig had remained on Dresdner’s board since resigning as chairman and becoming chief executive of Gazprom’s Nord Stream venture last year.
A spokeswoman for Nord Stream in Moscow said: “This is the private decision of Warnig to step down from the board of directors at Dresdner where he remains in contact. Nord Stream is the biggest infrastructure project in Europe and he is very much driving the project, due to start in 2009.”
Dresdner confirmed Warnig was no longer on its staff but said: “He maintains an ongoing relationship with the bank… in an advisory and consultancy basis.”
Warnig, who has known President Vladimir Putin since the early 1990s when he set up Dresdner’s office in St Petersburg, also sits on the board of Gazprom and was appointed a director of state-run bank VTB before its summer listing. Under Warnig, Dresdner became one of the most successful investment banks during Putin’s presidency.
It advised Gazprom on its $13bn (€8.9bn) acquisition of a majority stake in oil company Sibneft from oligarch Roman Abramovich and the Russian Government on its controversial valuation of Yuganskneftegaz, the main subsidiary of oil company Yukos.
It was also joint bookrunner and joint global co-ordinator on last year’ $10.7bn initial public offering by oil company Rosneft.
Nord Stream, a joint venture between Gazprom and Germany’s BASF and E.On, is building a 1,200km gas pipeline beneath the Baltic Sea near St Petersburg to the German town of Greifswald.
It last month selected Dresdner, Société Générale and ABN Amro as consultants on raising €5bn ($7.3bn) and said it would seek financing on capital markets at the end of the first quarter.
Jason Corcoran in Moscow
10 December 2007
German banker Mattias Warnig has stepped down from the board of Dresdner Kleinwort in Russia to concentrate on leading the construction of Gazprom’s natural gas pipeline to Germany.
Warnig had remained on Dresdner’s board since resigning as chairman and becoming chief executive of Gazprom’s Nord Stream venture last year.
A spokeswoman for Nord Stream in Moscow said: “This is the private decision of Warnig to step down from the board of directors at Dresdner where he remains in contact. Nord Stream is the biggest infrastructure project in Europe and he is very much driving the project, due to start in 2009.”
Dresdner confirmed Warnig was no longer on its staff but said: “He maintains an ongoing relationship with the bank… in an advisory and consultancy basis.”
Warnig, who has known President Vladimir Putin since the early 1990s when he set up Dresdner’s office in St Petersburg, also sits on the board of Gazprom and was appointed a director of state-run bank VTB before its summer listing. Under Warnig, Dresdner became one of the most successful investment banks during Putin’s presidency.
It advised Gazprom on its $13bn (€8.9bn) acquisition of a majority stake in oil company Sibneft from oligarch Roman Abramovich and the Russian Government on its controversial valuation of Yuganskneftegaz, the main subsidiary of oil company Yukos.
It was also joint bookrunner and joint global co-ordinator on last year’ $10.7bn initial public offering by oil company Rosneft.
Nord Stream, a joint venture between Gazprom and Germany’s BASF and E.On, is building a 1,200km gas pipeline beneath the Baltic Sea near St Petersburg to the German town of Greifswald.
It last month selected Dresdner, Société Générale and ABN Amro as consultants on raising €5bn ($7.3bn) and said it would seek financing on capital markets at the end of the first quarter.
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