NO MORE RIVALRY IN ARMS EXPORTS

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NO MORE RIVALRY IN ARMS EXPORTS

Moskovsky Komsomolets, November 9, 2000, p. 1

President Vladimir Putin has signed a decree merging two arms exporters, the Rosvooruzhenie and Promeksport companies, into a single federal state-owned unitary enterprise to be known as Rosoboroneksport (Russian Defense Exports).

Andrei Belianinov, deputy head of Promeksport, will become CEO of the new company. Analysts had assumed that Putin would seek someone to promote from Promeksport, because Aleksei Ogarev of Rosvooruzhenie is considered a man of the Family (Yeltsin’s team). Sergei Chemezov from Promeksport is close to Deputy Prime Minister Ilya Klebanov, and even worked with Putin in the presidential administration. Chemezov’s own chances were considered slim because Promeksport deteriorated under his management – in 1999 its sales amounted to only 50% of the previous year’s figures.

On the whole, the merger will benefit the state. Rosvooruzhenie’s exports in 1999 reached $3.4 billion and may reach $4 billion this year. Promeksport’s portfolio is estimated at $900 million.

This is going to be more than a purely technical merger. The monopoly will have to pass through a phase of restructuring fever first. It will take Rosoboroneksport at least three months to settle all organizational matters and so on. The Russian arms trade will be in limbo all this time.

SALVAGE OPERATION AIMED TO RETRIEVE SECRET EQUIPMENT FROM SUBMARINE

Moskovsky Komsomolets, November 9, 2000, p. 1

As we predicted, the salvage operation in the Barents Sea was needed to raise top-secret equipment and maps, rather than bodies, from the Kursk. According to our information, divers went down to the Kursk to retrieve the latest signalling code system, which Western intelligence agencies have been hunting for years. Along with the gear, divers lifted some fragments of bodies from the Kursk. All of them were sent to the 124th forensic laboratory in Rostov. Specialists say that identification will require expensive genetic testing, and a certain amount of work with relatives.

Navy Commander-in-Chief Admiral Vladimir Kuroyedov: I’m confident that it was a collision with a foreign submarine. I have some facts, but lack evidence, not all of which can be found on the seabed.

It seems the analysis of the latest data, on which Deputy Prime Minister Ilya Klebanov insists, will take months. Sources in the Defense Ministry say that experts will have to study the records made by the sub’s black boxes. They will probably reveal exactly what happened to the submarine.

At the same time, it is logical to assume that the divers didn’t achieve all their objectives. That is why ships of the Northern Fleet remain to guard the site of the Kursk disaster. Some top-secret equipment or documents must still be on the seabed.

RESTORING THE OIL SECTOR IN CHECHNYA

Izvestia, November 9, 2000, p. 1

Prime Minister Mikhail Kasianov has signed a resolution on restoring the oil industry in Chechnya. The document instructs the Rosneft company to set up a subsidiary in Chechnya, called Grozneftegaz.

Rosneft will hold the controlling interest in the future company, and the remaining 49% will be owned by Chechnya. In this way, the federal government is returning Rosneft to Chechnya, a company which has already invested 143 million rubles in the Chechen oil sector.

Actually, the decision to entrust Rosneft with restoration of Chechnya’s oil industry was made several months ago, and the draft resolution was prepared then. Who would own the controlling interest was the only problem. The federal government insisted that it should be owned by the party which invested the most.

Maksim Korobov, Deputy Chairman of the Duma Energy Committee, says “we could have stopped at 25%, a blocking interest…”

COMMENTS ON PRESIDENTIAL ELECTION IN THE UNITED STATES

Tribuna, November 9, 2000, p. 1

Sergei Rogov: Washington’s policy on Russia will not undergo dramatic changes. Both Democrats and Republicans advocate the concept of US leadership.

George W. Bush is not well-versed in foreign affairs, but his team includes specialists who used to work for his father.

A Republican administration will surely insist on reorganization of the International Monetary Fund and World Bank, because these agencies are not very efficient. This could have an impact on the problem of Russia’s state debts, because conditions for long-term restructuring of our foreign debt may change.

Writer Alexander Zinoviev: I do not think that Washington’s policy on Russia will change. More or less the same policy will be pursued, regardless of who becomes the next president. American presidents are puppets in the hands of the global community.

AN UPDATE ON REGIONAL ELECTIONS

Parlamentskaya Gazeta, November 9, 2000, p. 1

Valentin Tsvetkov has been reelected governor of the Magadan region with 62.76% of the vote. Observers ascribe this to the fact that Magadan became a special economic zone under Tsvetkov.

Communist and Duma deputy Alexander Mikhail polled 55.54% in the Kursk region, and has been elected governor. He promises that his very first order will concern “optimization of the regional government structure” and says that the money thus saved will be “channelled into social services.”

The second round of voting in the Kaliningrad region will take place on November 19. Baltic Fleet Commander Admiral Vladimir Yegorov will be competing against incumbent Governor Leonid Gorbenko.

PUTIN VISITS THE SOUTHERN FEDERAL DISTRICT

Trud-7, November 9, 2000, p. 4

On his arrival in Rostov-on-Don, the administrative center of the Southern federal district, the president visited District Hospital No. 1602, accompanied by his envoy Viktor Kazantsev, Security Council Secretary Sergei Ivanov, and other top officials.

Economic development in the Caucasus was discussed at Putin’s conference with leaders of the regions comprising the federal district. Migration issues were also discussed.

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