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Archive for October 2010

“Even at the time when Russia was the chaotic ‘Wild West,’ Tatiana’s own example proved that PR could be practiced here with real results at the highest professional and ethical standards,” said The PBN Company Chairman and CEO Peter Necarsulmer as he welcomed Tatiana Nikulshina back to the company she rejoined as Senior Vice President and Managing Director.

Incidentally, Tatiana thinks that competence in PR is still a hot topic after all these years. She has agreed to share some of her thoughts on the subject with the readers of Sovetnik.

What is, in your view, the worthiest starting point for our discussion today?

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Prime Minister Vladimir Putin courted foreign investors at a meeting of the Foreign Investment Advisory Council in Moscow on October 18, pledging equal protection of foreign investors’ rights and announcing the appointment of First Deputy Prime Minister Igor Shuvalov to the newly created post of investment ombudsman for Russia. The Foreign Investment Advisory Council, chaired by the prime minister, was established in 1994 as a forum for dialogue between the Russian Government and the leading foreign investors in the Russian market.

Putin appealed to the Council by calling for direct, private foreign investment: “Not just capital, but also so-called ’smart investments,’ or input accompanied by the transfer of technology with the creation of new high-tech and well-paying jobs.” As Putin noted at the meeting, the 42 international companies currently represented on the Council have invested almost $100 billion in Russia.

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On October 15, the prime ministers of Russia, Belarus, and Kazakhstan met in Moscow to discuss fostering greater economic integration between the three countries in the context of the Customs Union. Prime Minister Putin, talking at the press conference following the meeting, in addition to discussing the negotiations, devoted considerable attention to the question of admitting new members to the Union.

Putin’s enthusiasm is curious, given the non-existent economic and narrow political benefit that the two countries – Tajikistan and Kyrgyzstan – most interested in joining the Union can bring to the Union as a whole and to its member states. With weak economies, small markets, and porous borders, the accession of the two Central Asian states are likely to bring more economic problems than benefits. From a political point of view, the publicity boost of their accession could is likely to be short-term.

Putin’s enthusiasm boils down to the question of the growth of the Customs Union. The best answer, at least from the perspective of the Russian side, is Ukraine. By some estimates, reinvigorating deep Soviet-era integration between Russia and Ukraine in such industries as heavy engineering, space, defense and nuclear energy could boost Russia’s economy by 60%. The common wisdom is that Ukraine’s membership would be a political bonanza for Russia, because it would mean Ukraine’s rejection of integration with the EU as a long-term strategic goal.

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The sacking of Moscow’s long-time mayor, Yuri Luzhkov has jostled the city, affecting the futures of both the lucrative real estate market as well as the political landscape of Moscow.

On Friday President Medvedev has nominated his number one choice as successor, deputy prime minister Sergei Sobyanin, who, if elected, faces the tough task of stepping into the rather large shoes left by Luzhkov. What is clear is that the future mayor will have a daunting task if the rules set by the “old team,” or those who held positions in Moscow’s government while Luzhkov was in power, are not abided by. “Moscow’s problem is that this corruption system involves everyone from top to bottom. And the sacking of one person at the top in practice won’t change anything,” said Moscow businessman Vladimir Semago.

As a result of Sobyanin’s nomination, the analysts who questioned Medvedev’s reasoning for firing Luzhkov as being based on his desire to walk out from under the shadow of Putin have been quieted. Sobyanin is considered one of Putin’s right-hand men, and his appointment clearly demonstrates Putin’s continued influence over President Medvedev.

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As it is widely known, ex-mayor Yuri Luzhkov’s wife, Yelena Baturina, is ranked the 27th richest Russian according to Forbes magazine’s list of billionaires in 2010, with most of her $2.9 billion fortune acquired in her construction company Inteko. Before he was fired, Luzhkov was subject to widespread public criticism for using his position to help Baturina amass her wealth through construction contracts in the Russian capital.

Investors and observers are closely watching developments in the real estate and construction market and any repercussions related to Baturina’s corruption in the real estate sector during her husband’s tenure.

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Sergei SobyaninVladimir Kozhin Alexander Khloponin

After Yuri Luzhkov was dismissed from his post as mayor of Moscow, the question of succession was immediately raised. The 74-year-old Vladimir Resin, Luzhkov’s deputy, was installed as acting mayor. Bloggers spared no time in complaining that Resin is too rich and corrupt, particularly noting his penchant for expensive timepieces on a modest official government salary. From the outset, Resin had no chance to succeed Luzhkov.

As the dust settles on Luzhkov’s dismissal, everybody is talking about who will replace him.  Since the mayor of Moscow is appointed by the president, and not elected by Muscovites, the people’s choice emerged in internet straw polls. Kommersant, Russia’s most widely-read independent broadsheet, and Gazeta.ru, a leading news website, are running an online poll for the new mayor. They have assembled a shortlist of ten candidates, seven of whom were chosen by experts and three were nominated by the public. There were five leading public nominations, of whom two were disqualified by Kommersant’s editors – Yuri Luzhkov himself, on the grounds that the point of the online poll was to identify a new mayor, and Mikhail Khodorkovsky, on the grounds that he is serving a prison term (it is a tribute to his supporters that Khodorkovsky can still command such public support). Other popular nominees who scored highly but did not make it into the final three included Roman Abramovich, Yelena Baturina, Anatoly Chubais and Vladimir Zhirinovskiy.

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Oct/10

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Luzhkov: Vox Populi (part 2)

Since President Dmitry Medvedev announced the dismissal of Moscow mayor Yuri Luzhkov, Western media, observers and commentators have mainly focused on the larger questions of what this decision means for the Putin-Medvedev tandem or the 2012 presidential elections. While analysts and observers in Russia (especially the press) began immediately rejoicing, commiserating or simply enjoying the drama, Russians on the street reacted with indifference, ambivalence, or humor.

The “beginning of the end” for Mayor Luzhkov was his criticism of President Medvedev’s popular decision to halt construction of a motorway through the Khimki Forest in the outskirts of Moscow. Medvedev clearly had the public on his side in this skirmish. According to a poll published by the Levada Center, 66% of Russians supported the opponents of the motorway. The president’s approval rating rose slightly in the week after the decision.

In early September, an aggressive media smear campaign against Mayor Luzhkov and his wife Yelena Baturina was launched. Although most political commentators took it for granted that the Kremlin had sponsored the campaign, the public was far from certain. According to a Levada Center poll published on September 24, 38% believed the TV smear campaign was launched on the initiative of Putin, Medvedev or both. 16% thought the TV channels dreamed it up themselves and the largest group, 44%, simply didn’t know. Contrary to much of the commentary from political analysts, just 10% of the public believed it was motivated by disagreements between Luzhkov and the federal government.

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