Press review: Moscow’s ‘Butina List’ and Russia no longer among top five defense spenders / News / News agency Inforos
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Press review: Moscow’s ‘Butina List’ and Russia no longer among top five defense spenders

Press review: Moscow’s ‘Butina List’ and Russia no longer among top five defense spenders
Context:

Izvestia: Russian MPs to introduce 'Butina List' to punish US officials

Authorities in Moscow may compile what they dub as a 'Butina List' to include US officials who violate the fundamental rights and freedoms of Russian citizens, according to a request submitted by lawmakers to Russian Foreign Minister Sergey Lavrov. The father of Russian gun rights activist Maria Butina, who was sentenced to 18 months in jail last week, told Izvestia that this list would be an absolutely logical decision, TASS reported.

The document says that the criminal case against Maria Butina had been illegally launched to reinforce the ongoing myth about Russia’s 'meddling' in US affairs. The legislators have called on Lavrov to specifically place those individuals on the Butina List, who had initiated the Russian woman’s criminal prosecution in breach of international law.

"The threat of being included in the 'Butina List' in the future should start sobering up foreign officials, who have gotten used to clamping down on Russians with impunity and prevent violations of our fellow countrymen’s rights abroad," the document says.

Moscow should respond to flagrant injustices against Russian citizens, the Russian gun rights activist’s father, Valery Butin, told Izvestia. He said his daughter, who had been under relentless pressure since her arrest in July 2018, was forced to plead guilty to the charges against her in order to avoid a huge jail term.

"She had been convicted beforehand just because she was a Russian citizen. Any other foreigner would not have been given this sentence," Butin said. He voiced concerns over his daughter’s health, saying that discrimination against her could continue.

The document’s author, Valery Rashkin, a lawmaker from the Russian Communist Party, said the arbitrary arrest of Russians is now not out of ordinary in bilateral relations between Russia and the West, and while rivalry on the international political scene is growing, this could become a normal practice. "Given the example of Russian pilot Konstantin Yaroshenko, we understand what Maria Butina had feared and why she was forced to incriminate herself," the lawmaker told the paper.

 

RBC: Russia no longer ranked among top five global military spenders

For the first time since 2006, Russia has not made it to the top five biggest defense spenders club, according to a survey, carried out by the Stockholm International Peace Research Institute (SIPRI). Russia was the sixth-largest nation in terms of military spending at $61.4 bln in 2018. The five biggest spenders were the United States, China, Saudi Arabia, India and France.

Chairman of the State Duma Committee on Legal Assistance to the Development of Defense Sector, Vladimir Gutenev, told RBC that Russia’s decreasing military spending was linked to a peak in state defense orders and the diversification of the defense industry complex in favor of manufacturing civilian goods. He also noted that the portfolio of export orders for Russian military equipment has grown from $48 bln to nearly $55 bln. "This shows that despite reducing defense spending, we don’t create problems for defense industry enterprises."

Another reason why Russia’s military expenditure declined is the ruble's depreciation against the dollar, which affects purchasing power parity, Senior Researcher at the Center for Comprehensive European and International Studies at the Higher School of Economics Vasily Kashin told the paper.

The expert also explained that China, which is ranked second with military spending at $250 bln, has been boosting its expenditure proportionally to its economy. Its official military expenditures reach nearly 1.5% of the GDP. Turkey, which had the highest growth in military spending last year (24% to $19 bln), is switching to the next generation of armaments, Gutenev noted. "This is a momentary surge for the coming three or four years," he said.

Chief Editor of the Arms Export magazine Andrei Frolov told the paper that it’s very difficult to assess military outlays. "In various countries military expenditure is counted differently. For example, China does not include the value of R&D in the sphere of creating new arms systems and military equipment, they refer this to spending on industry," the expert explained. As for the volume of military expenditure in dollars, this figure is irrelevant, Kashin said. According to him, SIPRI’s calculations do not furnish an outlook on the military potential of countries. "The most vivid example is Saudi Arabia, which has higher military spending than Russia, but can do practically nothing as its industry is poorly developed," Kashin noted. If calculations had been made taking into account the purchasing power parity in the military sphere, the US and China would have kept their positions, Russia would have immediately "surged forward," while India and Saudi Arabia would have slid," the expert said.

 

Kommersant: Gazprom may sue Denmark over delaying Nord Stream 2 permit

Russian energy giant Gazprom still believes that there is a chance that the Nord Stream 2 gas pipeline may be launched this year despite the absence of Denmark’s permission for the construction. However, there is uncertainty seen in the statements by the company’s management. Simultaneously, Gazprom is laying the groundwork for legal action against Danish authorities, accusing them of baselessly delaying the process, Kommersant business daily writes.

Lawyers believe that Gazprom’s chances of clinching a quick victory in this dispute are slim. Analysts say even the threat of filing a lawsuit may turn up the heat on Denmark. On April 15, Nord Stream 2 applied for an alternative gas pipeline route to the south of Bornholm Island as demanded by the Danish regulator. The latter suspended the consideration of two previous applications until it has looked into the proposed route. Nord Stream 2 has simultaneously filed an appeal against the regulator’s demand.

Consequently, Denmark cannot delay issuing permission if there are no clear signs of environmental dangers for Gazprom's proposed construction route, Kommersant writes. "This may be considered as a violation of the United Nations Convention on the Law of the Sea," one of the sources told the paper. However, now the talk is only about dialogue with the regulator, not about litigation. If Gazprom chooses the latter option, this could drag on for years.

Denmark’s position forces Gazprom to seriously consider the upcoming talks on extending gas transit through Ukraine after 2020. Without Nord Stream 2, the company will need to pump nearly 70 bln cubic meters of gas per year via Ukraine, if the demand in Europe remains at the record level of 2018. The delay will worsen the project’s profitability.

If Germany manages to exert its political pressure on Denmark and make it issue the permission, the project can be built by the end of the year, Kommersant writes. It’s unclear whether it can start operations on January 1, 2020 and how it should comply with the revised EU gas directive. Nord Stream 2 is getting ready for it's legal battle. "In any case, the pipeline will be built and if transit is interrupted, it will be used, no matter if it is legal or not," one of the sources said.

If Denmark fails to issue its permission by August, the construction is unlikely to be completed by this year. Deputy Head of Russia’s National Energy Security Fund Alexei Grivach believes that the deadline for obtaining the permission is October. According to him, the threat of litigation and compensating for potential losses may force Denmark to give it the green light, however, the Danish authorities are not running any such risk right now.

 

RBC: Venezuelan companies, banks move $300 mln to Russia amid US sanctions

In late 2018, more than $300 mln in Venezuelan funds were moved to Russian banks, the Central Bank said. To beat Washington’s sanctions to the punch, Venezuelan banks transferred the money to Russian financial institutions, analysts say, according to RBC. Liabilities of Russian banks to non-residents from Venezuela rose 29% from $826 mln to $1.163 bln in the fourth quarter of 2018, the regulator said. Venezuelan companies and citizens transferred $337 mln to Russian banks.

The surge in Russian bank deposits by Venezuelan non-residents may be linked to money transfers from US banks since these accounts were vulnerable to being frozen given the sanctions, analyst at Promsvyazbank Dmitry Monastyrshin said. These could be legal entities and individuals as well as trade ties, for example, an advance payment for supplying goods, he explained. "It’s highly likely that fearing international sanctions and a freeze on assets, major Venezuelan companies tried to transfer a significant part of their available cash into the banks of friendly states, namely Russia," Head of bank ratings at the National Credit Ratings Mikhail Doronkin said.

The sum of $300 mln in general is insignificant for Venezuela, analyst at Raiffeisenbank Denis Poryvai noted. "Venezuela is a huge country with its own oligarchs and there is obviously much more money in its reserves than $300 mln," he said. The International Monetary Fund estimates that Venezuela’s GDP totals $76 bln. Meanwhile, the country’s gold and currency reserves are at $8.7 bln, Bloomberg says.

Doronkin says the growing liabilities are linked to the depreciation of Russia’s national currency. "The figures were definitely affected by the ruble’s depreciation in the fourth quarter by 6%."

The Russian-Venezuelan bank, Evrofinance Mosnarbank, which was tapped by Caracas to handle the transactions of banks and companies, was put on the US list of Specially Designated Nationals and Blocked Persons in March. Another Russian bank mentioned regarding Venezuelan relations is the Russian Financial Corporation bank linked to Russia’s arms exporter Rosoboronexport, which has been targeted by Washington’s sanctions since April 2018.

 

Kommersant: Moscow to pick new ambassador to UK

In mid-summer, Russia is going to replace its ambassador to the United Kingdom, one of the key countries in terms of global foreign policy interests, Kommersant writes. Alexander Yakovenko, 64, who has been serving as Russia’s envoy to the UK since 2011, is expected to become the head of the Diplomatic Academy, sources told the paper. The name of the new ambassador remains a mystery so far. Several candidates have been looked at, including deputy foreign ministers. Usually, the heads of Russian diplomatic missions in such countries as the UK, the US and France, tend to be former deputy foreign ministers.

However, a Russian diplomatic source told Kommersant that this time it’s unlikely that one of Russian Foreign Minister Sergey Lavrov’s deputies will be chosen as the new ambassador to the UK. After the Salisbury saga, bilateral ties have worsened and this position is viewed as a rather toxic one, the source explained.

The most likely candidate is Andrei Kelin, Head of the Foreign Ministry’s Department of European Cooperation, who is in charge of contacts with international organizations, including NATO. Kelin served as Russia’s Permanent Representative to the Organization for Security and Cooperation in Europe (OSCE) in Vienna in 2011-2015.

 

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