Month: September 2008

Going Back revisited

The serial posts I wrote a few years ago about the time I spent in Moscow as a research student during the late 1960s and early 70s are still on the Blogger server. They can be accessed here and here. The last posts in each series come first – links to the earlier posts are listed at the bottom of the relevant pages. I think these accounts still give a fair reflection of what it was like living in the Soviet reality, even for a relatively short period of time.


Recent news from the Russian Federation suggests that in spite of evidence of superficial change, life in Russia remains at bottom much the same as ever – not only as it was in Soviet times, but even longer ago. For one thing, there are the same sudden anomalies of behaviour in a government which on the face of it seems mind-crushingly authoritarian, yet occasionally makes room for flamboyant, incongruous forays into the denunciation of past wrongs. Such, for example, is the recent visit of President Dmitry Medvedev to the remote Magadan region on Russia’s Pacific coast, where he laid flowers at a memorial built to commemorate the victims of the Soviet Gulag prison camps, and described the whole era of Stalin’s deportations and purges as “a tragic page in our country’s history”.

Only a couple of days later, the United Kingdom’s outgoing Moscow ambassador Tony Brenton was describing to a British newspaper how he was personally made the target of a nightmarish, Gogolian campaign of intimidation when his car was

tailgated at high speed through the streets of the Russian capital by militant members of Nashi, Vladimir Putin’s zealous youth movement, who went on to harass him in shops and restaurants and intimidate his family.

In the long interview, Ambassador Brenton says thatduring his period of tenure the British Embassy “has come under a greater barrage of bugging and espionage from the Russian secret service than at any time since the end of the Cold War.” Describing some of the bugging methods used, he alludes to some curious details:

Sir Tony – who will next week be replaced by Anne Pringle, Britain’s first female Ambassador to Russia – denied rumours in Moscow that his two cats were regularly checked for bugging devices. The suggestion may seem fanciful, but the Soviet KGB once successfully implanted a listening device into a US ambassador’s dog.

It’s the promotion – even in theory – of cats and dogs to the rank of intelligence officers that is so quintessentially Russian. I would submit that in no other country of the world could one expect to discover such things.

Appeal for international military tribunal on Chechnya

On Chechnya-sl, Norbert Strade has translated the text of a recent appeal by Akhmed Zakayev, chairman of the ChRI Cabinet of Ministers:

Appeal by the Government of the ChRI

CHECHENPRESS. Publications and Media Department. 26.09.08

CHECHENPRESS received by e-mail the following appeal by the Government of the ChRI to the EU Headquarters, the President of the General Assembly of the UN, the Parliamentary Assembly of the Council of Europe, the International Criminal Court and leaders of democratic countries.

Ladies and gentlemen!

The Government of the Chechen Republic of Ichkeria, which is obliged to democratic values and considers human rights, the rights of nations and peoples to be fundamental achievements of civilization, addresses itself to you with the following:

– Taking into account the inhuman suffering of the Chechen people during the entire period of its history when it was under the control and influence of the Russian Empire in its different political manifestations (the USSR, the Russian Federation), such as the repeated deportations and the incessant military actions during the last 14 years, which demanded more than 200,000 lives, including 40,000 children, according to authoritative international non-governmental organizations;

– taking into account the zeal and the readiness for self-sacrifice of the Chechen people in the name of achieving freedom and independence, a convincing proof of which is the substantial support by the citizens of the ChRI for the Resistance forces, despite the fact that they thus subject themselves to terror from the side of the Russian military formations and special services;

– taking into account the numerous and unpunished war crimes committed by the occupation forces on the territory of the ChRI;

– taking into account the unquestionable right of the Chechen people to national sovereignty and independence, not only within the framework of the declarations of the United Nations “About the Rights of Nations and Peoples”, but also according to the decision of April 18-20, 1990, by the supreme body of power in the USSR, the Supreme Soviet of the USSR (whose legal successor is the RF), which defines an unequivocal treatment of the rights of the Autonomous Republics: “In the case of a union state leaving the USSR, an Autonomous Republic which is part of this union state has the right to determine its future independently”, a statement which precisely was the justification for the Russian authorities in their decision to recognize the independent statehood of Abkhazia and South Ossetia;

– taking into account the unquestionable fact that Russia acknowledged its military aggression against the ChRI in 1994, Russia’s defeat in this war and the signing on May 12, 1997 of the “Peace Agreement” between the RF and the ChRI, in which the sides determined that the peoples of the RF and the ChRI are ending their century-old conflict and that the relations between the subjects of this agreement from now on and forever will be based on international law and that the application of the armed forces will be categorically excluded from the solution of disputes;

– and finally, taking into account the existence of attempts by the RF side to take revenge for the lost war of 1994-1996, the incessant military operations and punitive actions, as a result of which thecitizens are suffering, as well as in view of the irreconcilability of the Chechen people with the conditions of the occupation, which are aggravated even more by a feeling of desperation over the absence of truth and justice with regard to the war criminals who committed war crimes in the Chechen Republic during the last 14 years, and furthermore in view of the alienation between the sides in the military conflict and the impossibility for the Chechen population to live in freedom and without fear in its historical native land, we request the creation of an international military tribunal for the Chechen Republic.

The Government of the ChRI believes that the absence of juridical and political consequences of Russia’s terrorist policy in the North Caucasus only discredits the entire world system of democracy and provides totalitarian regimes with a feeling of impunity and omnipotence, visible evidence of which are Russia’s latest actions against sovereign Georgia.

Chairman of the Cabinet of Ministers of the ChRI Ahmed Zakayev

PACE session to focus on Georgia-Russia war []

PACE Session to Focus on Georgia-Russia War

Civil Georgia, Tbilisi / 28 Sep.’08 / 18:17

The August war in Georgia will be the main focus of the autumn session of the Parliamentary Assembly of Council of Europe (PACE), which opens in Strasbourg on September 29.

The debates will be held in two parts: on September 30 and on October 2.

A group of 24 members of PACE submitted a request for the reconsideration of the credentials of the Russian delegation to PACE “on the grounds of serious violations of the basic principles” of the Council of Europe.

Vice-Speaker of the Georgian Parliament, Mikheil Machavariani, who is a member of the Georgian delegation to PACE, told journalists before departure to Strasburg that it was not yet possible to predict the outcome of the request and whether the credentials of the Russian delegations would be suspended or not.

As part of the run-up to the debates, an ad hoc committee will paid a fact-finding visit to Georgia and Russia. The group called for an international probe into the events that led to the war.

Meanwhile, on September 24, Foreign Ministers of Council of Europe member states met in New York on the sideline of the UN General Assembly to discuss Georgia-Russia war and its consequences.

This informal meeting was initiated by Carl Bildt, the Swedish Foreign Minister, who is now a chairman of the CoE’s ministerial committee.

The Swedish Foreign Minister said in the report submitted to the ministerial committee that as far as South Ossetia and Abkhazia are “integral parts” of Georgia “the military actions undertaken by Georgian forces during the conflict thus concerned Georgian territory” and should no way be seen “as an aggression towards the Russian Federation.”

“It is furthermore clear, that since it contravenes International law when a state uses military force to protect its citizens in another state, the Russian large-scale military actions in Georgia can not be justified as self-defense,” Carl Bildt said.

Russia acted like a colonial power

In his address to the United Nations General Assembly, Czech foreign minister Karel Schwarzenberg said that when Russia invaded Georgia last month it acted like a colonial power, Reuters reports.

We have recently witnessed systematic provocations and finally military aggression of a powerful country, a permanent member of the Security Council, against its small neighbor with the aim to carve it up,” Karel Schwarzenberg told the U.N. General Assembly.

“This action was designed to create two tiny entities totally dependent (on) its administrative, economic and military structures. Colonial powers used to act this way.” 

Schwarzenberg also suggested that Moscow had violated a fundamental principle of the U.N. charter and international law — that disputes should be resolved peacefully and without resorting to military force, except in self-defence.

Domain name change

On September 25 the Ingushetian authorities closed down the web site, which was owned by Magomed Yevloyev,the Ingush journalist, lawyer and businessman who on August 31 this year was murdered, it is believed, on the orders of President Murat Zyazikov. However, the site immediately changed its domain name and switched to a server the United States. It can now be accessed at the new URL

At Window on Eurasia,  with particular reference to a recent interview with Russian security and intelligence expert Anatoly Soldatov, Paul Goble demonstrates how Moscow is currently struggling in its attempts to control the Internet,

… senior Russian intelligence officials have repeatedly called on Western governments to reach an agreement with Moscow to close sites that the Russian government has identified as connected with extremism or terrorism. But to date, no Western country has agreed to do that.

Great Britain had been edging toward an accord, the editor says, but backed away after the Litvinenko murder. And as a result, “it is possible to register in England, to put out a Russian Internet publication and no requests from the Russian side will be considered. Simply because there is no legal basis for this.”

As a result, Soldatov concludes, Moscow will not be able to continue its struggle with independent-minded Internet sites without the use of hackers, a conclusion that the experience of other Russian sites tends to confirm ( and

58th Army being transferred to Ingushetia

FinRosForum, citing a report in Nasha Abkhazia, writes that Russia’s 58th Army, which played a major part in the recent invasion of Georgia, is being transferred from North Ossetia to Ingushetia, noting that the situation in Ingushetia is becoming more complicated and that there is a fear that after the end of Ramadan the Ingush will start an uprising.

SCB discussions

A couple of recent discussions on soc.culture.baltics connected with the recent controversies surrounding Estonian-Finnish relations can be found here and here. Although I don’t post much to the newsgroup these days, I’ve contributed a few items during the past few weeks. A leading voice in several of the debates is that of Eugene Holman,a lecturer at the University of Helsinki, but there are many other posters with equally interesting points of view.

Time to Extend a Hand to Ukraine

Writing in the New Atlanticist policy and analysis blog, Alexander Motyl argues that it’s in Europe’s interests for Ukraine to join the European Union “both if and when it meets all the membership criteria”. Excerpt:

If Brussels really believed in European values, soft power, and the like, it should be able to state, unflinchingly and immediately, that “Ukraine is European and, once rich and fully democratic, deserves to be within the EU.”

Of course, if Brussels—or, more specifically, such states as Italy, Germany, and France—don’t really believe in democracy, then indifference to Ukraine’s European aspirations makes more sense. But just a tad. After all, if old Europe’s ruling elites are primarily interested in hard power and geopolitics, then they should be even more interested in getting Ukraine on their side. As Zbigniew Brzezinski has often pointed out, an independent Ukraine is the best guarantee of Russia’s non-emergence as an
empire and, I might add, of the Cold War’s non-revival. That admonition may have seemed like a bit of hypothetical reasoning in the past, but the Russo-Georgian War of 2008 has surely demonstrated that Putin’s Russia is ready to reassert itself in the former Soviet imperial space and, thus, to threaten Europe’s geopolitical interests.

The good news is that the global economic crisis and the fall-out from the Georgian invasion have refocused Moscow’s attention on Russia’s domestic problems. That gives Ukraine time to get its house in order and accelerate its efforts to join Euroatlantic structures. That also gives Europe time to come to its senses and extend a hand to Ukraine. The bad news is that Ukraine’s squabbling political elites—and Yushchenko, alas, belongs to them—seem ill-equipped to do anything but squabble. And old Europe seems ill-prepared to do anything but kowtow to an authoritarian Russia. Not coincidentally, perhaps, the Munich Agreement that made appeasement so
notorious a concept took place exactly 70 years ago, in September 1938.

The Russian Gas Deficit – is it Real?

The Russian Gas Deficit – is it Real?

Tunne Kelam’s  speaking notes in the  EP Baltic-Europe Intergroup on 23rd September 2008 in Brussels

Analysis by Boris Nemtsov (former Russian deputy Prime Minister) and Vladimir Milov (former Russian deputy energy minister).  Moscow, 2008-09-22

·         The position of Gazprom in Russia is unique.  In 2007 Gazprom earned 93 billion USD which is 7% of the Russian GDP (2, 5 times more than the Russian defence budget). 

·         Gazprom provides more than 12% of the volume of Russian industrial output and 16% of the value of Russian exports. 

·         Gazprom supplies provide for 40% of the Russian electricity production.  In other words, Gazprom is the energy heart of Russian industry.

Gazprom has become the most important personal project of Vladimir Putin. The Russian president has renovated the management of the company, not on the basis of professional abilities but on the basis of their membership of his Petersburg clan.  Prime Minister Kasyanov’s attempts to reform the gas industry in 2002-2003 and to open it to competition were blocked by the Kremlin.

Putin also approved the decision to raise the price of gas for Russian customers.  Gazprom had lobbied for this move during the past 15 years, but unsuccessfully.  The Fradkov Government, however, decided in May 2007 to double the domestic price of gas by 2011 (from 64 USD for 1000 cubic meters to 125 USD). 

Management which is loyal to Putin has operated Gazprom for 7 years.  Its main “achievement” has been not to allow the company to fulfil its key job – to provide for a reliable supply of gas for Russian customers.  Gas production has, in fact, stagnated during all these years.  In 1999 it was 546 bcm, in 2007 – 548 bcm (in 2006 a record 556 bcm). 

Gazprom supplies for domestic customers have increased by 2% (from 2001 till 2007), while internal demand has increased by 18%.   In 2007, Gazprom supplied 307 bcm to domestic markets, while the unsatisfied demand is 132 bcm (increase of 72 bcm a year since 2001).  One third of Russian internal gas consumption has to be supplied through “non-Gazprom” sources. 

As for the domestic markets, Gazprom supplied 301 bcm (in 2001) and 307 bcm (in 2007).  At the same time, domestic demand was 373 bcm (in 2001) and has increased to 439 bcm (in 2007).  The gap between demand and supplies increased from 72 bcm (2001) to 138 bcm (2007).  This gap has been traditionally covered by supplies from Russian independent producers and by gas imports from Central Asia.   Now the Government has strictly curbed the potential of independent companies while the prices of Central Asian gas have skyrocketed.  As a result of this new situation, during the winter of 2007/2008, Gazprom almost totally exhausted its underground gas reservoirs.  

The stagnation of gas supplies for the domestic market can be explained only by the systematic lack of investments into the production of gas.  The new super-giant gas field lies in Yamal peninsula – 600 km to the north of functioning fields.  Gazprom obtained licences to exploit the Yamal fields, committing itself to start production of gas there by the end of 1990s.  Nothing really has happened.  Under the Gazprom chief Aleksey Miller, licences were extended by 8-12 years.  However, even the new terms are not being met.  

Nowadays, the costs of the whole project of starting production and transportation of gas from Yamal peninsula are estimated to be ca 200 billion USD – a sum which exceeds the Russian Stability Fund. 

On the background of general economic growth (GDP increase of 70% in 2000 – 2008), Gazprom production has not increased.  This leads Russia to the deficit of gas. 

Gazprom’s burden of debt has grown from 13, 5 billion USD (2000) to 61,6 billion USD  (2007).  This amounts to two thirds of the company’s earnings.  The increasing debt burden does not allow Gazprom to make sufficient investments into gas production.  Default in the foreseeable future is not excluded. 

For the biggest state owned company, Gazprom’s contribution to the Russian state budget is surprisingly modest.  Gazprom paid 7 USD taxes for every barrel of produced oil and gas while oil companies pay 40 USD per barrel.  

As a result of the policies of economic-political expansion, Gazprom lost control of 60 billion USD of its assets.  

Gazprom spent 14 billion USD to buy the oil company Sibneft   (this sum equals 3 year investments to the production of gas).  The economic result of this deal has turned out to be catastrophic – in 3 years Rosneft production fell by 11, 5%. ???

Lack of efficiency in running the company has exceeded the worst expectations.  Since 2003, the operational costs of the company tripled – from 4, 9 USD a barrel to 14, 8 USD. 


Alan Riley’s analysis from October 2006.

/Riley is Research fellow, Centre for European Policy Studies, Brussels/

·         The core issue – for the EU – is not the threat of a politically motivated gas cut off (as happened in January 2006) but that Russia, as a result of lack of investments, will not be in a position to produce enough gas to cover both Russia’s domestic needs and the EU demand. 

·         Riley ( 2 years ago) – if no action is taken by 2010 the EU may be facing a deficit close to or even beyond its current Russian gas import level.  The decline of supply from the Russian gas fields is likely to make it increasingly difficult for Gazprom to meet its supply contracts … which will lead to a significant supply crisis across Russia, the CIS and the EU. 

·         True, since 1968, when gas first flowed to Western Europe, Russia has been a reliable supplier to Western Europe.  However, the same cannot be said of supplies to Eastern Europe – at least 40 cuts offs have been identified since 1991. 

·         The gas deficit was identified by the IEA /International Energy Agency/ and Vladimir Milov /former deputy energy minister and president of the Moscow-based institute of energy policy/.   This deficit was already identified 2 years ago and is likely to grow above 126 billion cubic meters (bcm) by 2010.  Current Russian exports to non-FSU Europe /non-former Soviet Union/ are ca 150 bcm.

·         It seems unbelievable that the country with the world’s largest proven reserves /47 trillion cubic meters – 26% of the global proven reserves/ can be running short of gas.

·         During the first decade of the 21st century the supply deficit has become increasingly acute.  It arises from two interlocking problems.

1.       The run off from the existing super-giant fields in Nadym Pur Taz (NPT) region

2.       The lack of domestic investments in new fields. /Gazprom has not opened up any new giant fields apart from Zapolyarnoye, which is a Soviet legacy project and has temporarily reduced the impact of the decline of the NPT fields/. 

There has been no necessary investment to develop new super-giant fields.  Why?

Gazprom itself is heavily in debt – just the purchase of Sibneft added 38 billion USD to its existing debt. Also, whenever Gazprom does have extra revenue, it fritters it away in higher operating costs. 

The Russian financial system is weak and cannot provide financing on the scale necessary to develop super-giant gas fields. / The costs of developing the next super-giant filed in Yamal area are estimated to be 70 billion USD/ Gazprom’s decision to develop the Shtokman field without a foreign partner will add significantly to these heavy capital demands.

Even where Gazprom invests, those investments are directed at foreign acquisitions and building export infrastructures, NOT on building and refurbishing domestic pipelines and opening up new fields.

While huge foreign investments will be needed to develop new gas fields, Russia is handicapped by its own policies which view foreign investors as a threat and do not provide room for open competition or for safeguarding investors’ rights.  Russia’s unwillingness to comply with contractual agreements is likely to act as a powerful deterrent to potential future investors.  The huge costs / 70 billion USD / of developing the Yamal super-giant fields are not likely to be covered even partially by foreign companies.

Another problem that has made foreign investors uncertain and hesitant is limiting their rights to 49% of shareholding.  /Cases of Shell and BP in Sakhalin in 2006/.  But the general hostility towards foreign investments forces Western shareholders in energy firms to accept much smaller percentages than the theoretical 49%.

The deficit was widened by the Gazprom decision to press on with domestic gasification, aiming at 60% regional gasification by 2008 and at building 12.000 km of new domestic pipe-lines. 

The aging of much of the Soviet legacy infrastructures.  Inefficient Russian compressors used to pump gas along the pipes cause an estimated loss of 42 bcm a year.  (IEA estimates).  58% of the pipes are more than 20 years old.  In harsh environments there is real concern of gas leakages from the aging infrastructures. 

Lack of alternative supplies has forced Gazprom to engage in a desperate rescue strategy – to purchase gas from Central Asia.  It must really be a desperate situation when the world’s largest holder of gas reserves has to buy gas from abroad.   In 2006 Russia planned to increase its gas imports from Central Asia from 6 bcm (in 2004) to at least 60 bcm in 2009 that is at least tenfold.  To have such volumes really delivered seemed unrealistic two years ago. 

Potential consequences of the possible gas deficit. 

Russia itself will be most vulnerable to serious gas shortages. If Russia will cut foreign exports to protect domestic consumption Moscow will have to face dramatic cuts in foreign incomes (Gazprom provides 20% of federal tax revenues).  For example, increasing pensions will become highly problematic.  If the gas deficit will become even more significant, then cuts will strike at Russian industry which is (together with that of Ukraine and central Asia) the most energy-Inefficient in the world.  This could also influence negatively earnings from oil, minerals and metals and start a vicious downward spiral which would undermine the economic gains achieved since 1999. 

A longer shortage of Russian gas could throw several Central- and Eastern European countries into considerable difficulties both in respect of industrial production and in terms of the safety and comfort of their peoples.

The most dangerous consequence of significant gas shortages would be the effect on Germany.  In the EU’s largest economy, such shortages could cause widespread economic disruption which would have repercussions across the EU.  The sharp edge of this forecast is that the gas deficit will hit well before the NEP comes into operation and Shtokman  gas comes on stream.  As a result any gas shortage /whatever the formal contractual position/ will hit the most westerly EU states receiving Russian gas, first and hardest, and Germany as the biggest recipient hardest of all. For Germany there is an additional risk in the possible fall in value of German investments in Russia as the Russian economy will contract as a result of such gas shortages.  This underscores the risk of individual member states seeking bilateral agreements with Russia.  In fact, Germany has made a major strategic error.  It has made itself heavily dependent on Russian gas without having the corresponding power to force its Russian partner to liberalize its own markets, to permit free flow of foreign capital and to ensure the protection of the rights of investors that would ensure that gas will be available and will be delivered.                            

End of TK speaking notes.