N°67 - December 6 2007 Published every two weeks / International Edition CONTENTS KREMLIN P. 1-3 Politics & Government c KREMLIN Half-tinted election triumph c Half-tinted election triumph Election No, it wasn’t a resounding victory... Taking into account the means deployed, the multitude LEGISLATIVE ELECTIONS Special of manipulations practice throughout the country abouty the level of participation and the c The Winers and losers of on the number of votes obtained by United Russia, the score of 64% in favour of the presi- December 2 dential party (and therefore Vladimir Putin), it could not be completely satisfactory for the Kremlin. It is ALERT far from the standard of 70% that many of those close to the President had announced as probable and so c Yevgeny Shkolov, or the it is natural that Vladimir Putin expressed his displeasure with these results and that he did not even see "Dresden connection" in the fit to visit the headquarters of United Russia Sunday night. Interior ministry FOCUS Also, this result does nothing to ease the embarassment that the Kremlin finds itself in concerning the c The strange confession by process of succession of Vladimir Putin. Even if it consecrates the pre-eminence of United Russia in the Oleg Shwartzman Duma (it passes from 305 to 315 seats), even if it confirms the popularity of Vladimir Putin with a majority BEHIND THE SCENE of Russians, this election changes nothing fundamental. It justifies the fact that Vladimir Putin can be des- c Vladimir Zhirinovsky : the little secrets behind an elec- ignated as Prime minister (but we hardly had any doubts about the fact that this could be technically pos- tion list sible), it could provide a basis for the creation of a status of “national leader” but it cannot hide the inter- nal contradiction in which the elites still find themselves : that Putin leaves the Kremlin while still remaining P. 4-7 Business & Networks in control of the state. None of the plans envisaged is satisfactory : the function of Prime minister, without METALS, MINES a significant modification of the constitution, offers no guarantee of permanence. The status of national lea- c Norilsk Nickel in the eye of der would require acrobatics backwards and forwards with the president, although nothing in the consti- the cyclone tution is foreseen for such a personality. This would establish a sort of bi-headed executive whose chances GAZ of success seem minimal in the current configuration of the powers and the clans in Russia. In the mean- c Kovytka : Gazprom plays cat time, the struggle to establish power and influence continue unabated in the power circles. Which creates and mouse with TNK-BP sur-realistic situations. So, the vice Prime minister and Finance minister, Alexey Kudrin, is still not “au- TELECOMS thorised” by the Sechin/Patrushev/Ustinov clan to pay a visit to his deputy, Sergey Storchak, emprisoned c Fridman and Reyman bury in Moscow since some ten days (Russia Intelligence n°66 of november 22 2007) and about whom legal char- the hatchet ges are never ending. These days the Shwatzman affair has unleashed a tempest (read page 3) and is in- FOCUS terpreted as a retaliation by the Cherkesov/Kudrin clan. After having given a good blow to the presidential c Green light for the south- administration (where Sechin has his office), Shwartzman retracted his declarations (in which he affirmed European gas pipeline managing a vast business network around Sechin), in accusing the Kommersant newspaper (whose owner OIL is Alisher Usmanov), of having “invented” the statements the daily attributed to him. Late regrets which c Rosneft : the great loneliness of Sergey only lead to further degradation of the climate. Bogdanchikov From his side, the Prime minister Viktor Zubkov is profiting from the situation to confirm his mastery P. 8 Regions & CIS over the government and wants to name a certain number of close associates to key posts (read page 7). He CASPIAN is said to have activated the financial and tax files on a certain number of oligarchs in order to inspire them c Gazprom Yields to the to caution, or even obediance, since it affects financial and industrial operations underway (read page 5 on ultimatum by Gurbanguly the discussions surrounding the fate of Norilsk Nickel and Vladimir Potanin). At once, it is no longer sure Berdymukhammedov that he is this docile and manageable personality that he was described to be following his nomination. Among certain major bosses in the circle close to Vladimir Putin, there are attempts to accelerate all ope- SUBSCRIPTION rations underway in order to conclude them as quickly as possible. This is the case of Sergey Chemezov who Print Edition has just abandoned the leadership of Rosoboronexport (read page 7) to devote himself to the new state (23 issues, airmailed overseas) holding company, Rostekhnologii. There is comparable agitation at RZhD, where Vladimir Yakunin has €770 TTC announced a strategic alliance with the Canadian group Bombadier, which the latter denied the imme- The Web Pack diacy just a few hours later. As to Oleg Deripaska, he is playing a delicate but well engaged game with Mi- (Print Edition khail Prokhorov over control of Norilsk Nickel, which if successful, will bestow on him the honorary status + PDF + archives acess) of “national industrial leader”. € 880 TTC The Premium We are also finally waiting a reshuffling in the energy sector, such as the “departure” of Alexey Miller Subscription from his post of director general of Gazprom, for example, or that of Sergey Bogdanchikov of Rosneft, (Print Edition + PDF + access where a wave of resignations has struck his closest collaborators in recent weeks. In brief, it is a strange to all the website contents) end-of-reign atmosphere which has taken hold in Moscow while no-one yet knows what tomorrow will € 1200 TTC hold... d www.russia-intelligence.fr RUSSIA INTELLIGENCE Politics & Government LEGISLATIVE ELECTIONS c The winners and losers of December 2 Election As this current edition goes to press, the partial But the atmosphere is far from being triumphant. It must be said results furnished by the election commission re- that the candidate Putin lost close to 7% (and 5 million votes) Special port apply to more than 95% of the votes and are between the presidential elections of March 2004 and the legis- not likely to change significantly. Four groups have crossed the lative vote of December 2. And this even though the totality of threshhold of 7% required to enter deputies in the parliament. “administrative resources” had been mobilised : media bombast United Russia (64.23%), the Communist party of the Russian fe- on the state television channels, very “organised” voting in the deration (11.63%), the liberal-democratic party of Vladimir Zhi- military and prisons, advice given to students and university ad- rinovsky (8.14%) and Just Russia of the Federation council pre- ministrations, etc... Anxious to avoid any unpleasant surprises sident, Sergey Mironov (7.75%). According to the president of and faithful to the Stalinian slogan according to which what the central election commission, Vladimir Churov, these groups counts more is less the way people vote than the way the votes obtained respectively 315, 57, 40 and 38 seats in the State Duma. are counted, the Kremlin even went so far as to create a special Officially, the participation in the vote of December 2 reached working group within the central Electoral commission in order close to 63%, was significantly more than during the legislative to supervise the conformity of the statistics published. This group elections of December 2003 (55%). was not inactive if we can believe numerous reports of opposi- tion monitors that claimed a systematic rewriting of the trans- cripts established by the voting offices. A closer analysis of the official results of the vote leave the impression of certain unpleasant elements for Vladimir Putin. In some ten regions, United Russia obtained a score below 55%. This is particularly the case in Saint Petersburg (50.33%), but also in Moscow (54.15%), in Yaroslav (53.17%) or Smolensk (53.92%). The “Turkmen” results recorded in Chechnya (more Gennady Zyuganov Sergey Mironov Vladimir Zhirinovsky than 99% participation and an equivalent score for United Rus- The reactions of the principal competitors are, we can ima- sia) can not obscure the low turnout in North Ossetia, where gine, contrasted. The most virulant are the communists. Their the powers’ rhetoric on rediscovered stability still has trouble leader, Gennady Zyuganov, denounced the balloting as “the dir- passing three years after Beslan. tiest in Russia” for 15 years (even though the presidential elec- tion of 1996, where he had been beaten by Boris Yeltsin, had up The situation is, as can be seen, in greater contrast than could to now been a “reference point” in electoral fraud). It must be be said in Russia and the West. Has Vladimir Putin really won his said that the regional elections of the spring (Russia Intelligence bet? Has he emerged stronger from this vote, as the decisive bat- n°51 of March 16 2007) and the renewed inflation observed since tle for power in Moscow is being prepared? The congress of Uni- the start of autumn led them to hope for a score of close to 20%. ted Russia which will be held in mid-December will no doubt pro- The “historical” democratic parties — Yabloko and SPS — col- vide some indications on the intentions of Vladimir Putin and on lected respectively 1.60% and 0.96%. Failing for the second conse- his control over the scenario. d cutive time to enter into the parliament, these political forces must be considered as remnants of past political realities.