Wednesday, 27 June 2007
This came through the other day as an extract from a (forthcoming?) Alfa Bank report. Looks like it will be worth begging, borrowing or stealing a copy, if you're not already an Alfa investment banking client...
The emerging 4x4 Energy Strategy
Tuesday, June 26, 2007
While the government has never formally clarified its strategy for either its involvement in the oil and gas sector in Russia or its plans to help Russian companies expand internationally, both upstream and downstream, we now have almost enough evidence allowing us to build a model of how it is most likely to work. That is, at least based on current evidence, best described as the "4x4 Energy Strategy".
The four domestic strategies are:
• State companies control 51% of all major energy projects.
• An international energy major is included in each project with an equity participation of 25%. That company will more often than not be the operator of the project.
• The remaining 24% is eventually allocated in several smaller lots to National Oil Companies from other countries (e.g. China, Malaysia, India, etc) for which the Kremlin has bartered greater energy cooperation in exchange for some reciprocal trade, investment or political deals.
• The next major investment theme will be to concentrate on downstream processing of greater volumes of gas and oil inside Russia so as to eventually have a better balance between the export of raw material and higher value-added products from the raw material.
The four international strategies are:
• Access to international upstream and downstream projects for Russia's National Champions Companies by bartering reciprocal deals in upstream Russian oil and gas.
• Creating JVs with international energy majors to facilitate access to politically and economically sensitive downstream, particularly in both LNG and natural gas distribution.
• To develop Russia's National Champion Companies to eventually rank amongst the world's biggest energy giants.
• To have a controlling/influential role in export routes from Russia and the CIS countries.
Note: This is a subject and theme to be written about separately later.
Sunday, 24 June 2007
This is not true of Russia. Chechnya, which is now almost quiescent – was never a wedge deep across the whole nation; rather it was more like Northern Ireland; a local dispute which was, for the most part, contained and not at all reflective of the wider national conversation (rare hot-spot troubles aside).
So, anyway, the latest example of intellect-lite. The World Values map – which I reproduce below:
Now I am not going to diss this completely – because inasmuch as you can use a bi-linear analysis to summarise the world, it’s not utterly useless. The problem of course is the extent to which you have to adopt completely faux parameters in order make your pretty global picture.
For while I can see that there is some validity to creating a spectrum that runs from ‘traditional values’ through to ‘secular-rational values’; it seems to me that ‘spectrumizing’ – ugh, sorry for that word, but somehow seems to fit here – “survival values’ through to ‘Self expression values’ is invalid.
The survey says of its methodology:
“The second major dimension of cross-cultural variation is linked with the transition from industrial society to post-industrial societies - which brings a polarization between Survival and Self-expression values.”
Nice. So, mate, where would you put Lebanon on that map? People who know me know I am besotted with truly-madly-deeply wonderful Beirut. But, go on: where would you put Lebanon? Indeed, interestingly, I see this map seems to have forgotten the Middle East almost entirely… because Iraq, Saudi Arabia, Qatar, Oman and the Emirates, even Syria, just don’t fit the picture. Ditto, mutatis mutandis, where’s Israel on it? Also, do I really believe that Shinto-revivalist Japan has abandoned religion as much as this survey suggests?
This habit of making pretty pictures and league tables as a substitute to real thinking of course is not new. It all started, with a vengeance, in the 1970s with the management consultants, Boston Consulting Group; who managed to fit any business you care to mention into one of four inter-locked boxes. The BCG boxes still hold pretty valid – I use them myself – but as our world hurtles faster and faster – thank you technology – to some neo-medieval clash of civilizations, we need much better foreign policy education.
After the calamity of the first half of the twentieth century, the age of gentleman-amateurs conducting foreign policy came to an end (Viscount Halifax being a notoriously good example) and we began to professionalize our approach to foreign affairs: hence the explosion in all those international relations and foreign relations courses. We need, again, a new approach to managing geo-eco-political issues. Cute boxes won’t cut it.
Wednesday, 20 June 2007
These include Russia’s 4th largest airline, UTair (whose plane tragically crashed in Samara earlier this year); as well as KrasAir’s Tu-134 fleet. KrasAir is not only the 6th largest airline in Russia; it is also, through AirUnion, the proud new owner of Malev, Hungary’s flag-carrier.
The Russian self-imposed bans come ahead of the usual quarterly update on the ‘no fly’ list issued by the EU. Last time, while no Russkie airlines were banned, a number were warned they were jolly close to it. It provoked a furious reaction from the Russian authorities (which then lamely started to fantasize about poor flying skills of EU pilots in Russian airspace). They abandoned this stance when UTair 471 slammed into the ground just 48 hours later…
My point though is this. While I recognize that being declared ‘unsafe’ by the EU is not the same as being ‘dangerous’ per se; why does Russia preemptively agree with the EU that these airlines or planes are not fit for international airspace, but allow them still to fly in Russia?
As we enter the busiest season for Russian aviation, some planes – including those banned from EU airspace and their carriers – will be put on extra routes or these airlines will use older planes not regularly used, to cope with passenger numbers and holiday charters.
Fingers crossed everyone…
PS: read Arseniy Rastorguev, on that BBC Russian-alcohol-storm thing yesterday which I think nicely captures the frustration of Russia's 'bright young things' about what the West says about them, coupled with a certain sense of gloom, nonetheless, about their own country.
Kommersant reported today that despite the rumours, the deal was still on but the picture seems very confused. Bluntly all the noise that the bid will be pulled this Saturday – when the Aeroflot Board meets – is coming from ‘informed sources’, behind the scenes. The denial comes on-the-record from the Aeroflot press office.
Ah…on the record…press office. In more...ahem...Sovietique Russian companies the press office is always the last to be told anything: this is not so much so that they tell an untruth in all innocence; more because they are so low in the food-chain that the ‘big swinging dicks’ – as we used to say in my banker days – simply forget their existence.
Alitalia says the deal is still on – like you tell the bride beforehand that she’s about to be jilted at the altar – and Unicredito, the lead bankers? Silent as the freakin' grave (calculating their deal-cancellation compensation no doubt). If Aeroflot pulls out I think they’ll only be one bidder left, LOL, a discount airline of rather shallow balance sheet.
Deal off or on. It’s still a crap deal for Aeroflot. But I think the deal will be off…
In matters so much more weighty, the European Parliament spent today debating what exactly is Vodka, when sold in the EU – really important stuff eh?
Politically, the EU divides into the vodka bloc (Poles, Balts) who want only grain- and potato-based spirits (over 40% proof?) to be called Vodka. The Wine bloc – those soft southerners want a broader-based definition: for instance, they make vodka from things like sugar-cane – er…isn’t that rum? – and grapefruit mash. Nice.
Apparently the third bloc is the beer bloc. Yes, Germany, Czech and the other Easties held the swing vote and refused to give protection to the ‘purity’ of Polish vodka.
Requests that ‘Vodka’ be geographic in its definition (like Champagne) had long been refused; although someone suggested that there be a definition between Vodka (generic) and Wodka (geographic)…it died as an idea a long time ago.
The Russian delegation to the EU denies it ever asked that Vodka can be called vodka even if made from meths or industrial alcohol … ;-)
ICQ users spread the following message (please see below in Russian) to their contact list saying ‘Let’s surprise BBC: choose ‘Regularly’ in the poll section on the page http://news.bbc.co.uk/hi/russian/russia/newsid_6755000/6755283.stm.
проголосуй "регулярно" и перешли дальше: http://news.bbc.co.uk/hi/russian/russia/newsid_6755000/6755283.stm
(голосовать в правой части страницы)
As you can see, the results of the poll demonstrate that almost 90% of audience does drink antifreeze and technical liquids containing spirits on a regular basis... There are around 1700 people who voted already)."
But it gets better. The BBC – not liking the answers coming out – then *deleted the votes cast* to start again. Oh yes – BBC mates confirm it – they *deleted results they didn’t like*. So much for reporting it as it really happens eh? BBC? Bent and Basically Censored.
Saturday, 16 June 2007
So, congratulations today for those people honoured in the Queen’s Birthday Honours list. Inter alia, two names particularly caught my eye. Our Ambassador to Moscow, Anthony Brenton has been made a Knight (and, upon his investiture, will become Sir Anthony Brenton).
Although, two – wonderfully British – caveats here. One today isn’t actually, of course, the Queen’s real birthday; but the Official birthday. (a) it’s a nicer time of year for Trooping the Colour, the ceremonial celebration of the Monarch’s birthday and (b)…well…it’s convenient to have a second Honours’ List half way through the year: convenient for the Government that is. The Queen, of course, doesn’t choose who goes on the List – the Government which serves in her name does that.* [slightly rambling footnote @ bottom of post - Exile]
Mine is not a country short of honorific tags: that what 1,000 years of monarchy gets you. Brenton (you’re not supposed to call him Sir until he actually gets dubbed, until then he is still plain Mister, albeit HE) will be Knighted in the Most Distinguished Order of St Michael & St George. Traditionally, that’s the Order for diplomatic or other overseas (civilian) service to the Crown. Brenton is already a Companion in that Order (and has the letters CMG after his name); now he gets his ‘K’ – his Knighthood – and the letters after his name become KCMG.
In London establishment circles – which always like to laugh at the FCO – there is a little joke about the Order of St Michael & St George:
CMG = Call Me God
KCMG = Kindly Call Me God
GCMG – that’s terribly grand and the highest level of the order – God Calls Me God
Oh…the little things we Brits laugh at…
In the old days, Ambassadors were usually knighted either at the start of their stint (very grand postings) or at the end: the ‘rules’ are much more fluid now. I think it would be a very nerdy thing to be an Embassy-watcher – so I shan’t admit to it – but I wonder whether Brenton’s ‘K’ isn’t a sign he’s about to go.
Of course, this year he has had to put up with a lot: - those asswipes Nashi harassing him wherever he goes, for instance – but, let’s face it, Britain’s relationship with Russia, politically, hasn’t been this bad since Brezhnev. Actually, it might have almost been better then… Not a huge success for Brenton then (albeit probably bugger all he could have done about it). Orthodoxy says he should stay in his post at least another year (‘safe pair of hands Old Boy while the new PM settles in….see us through the Russkies' changing of the Kremlin guard and all that…'). I wonder if the FCO shares my view and thinks – lovely bloke that he is (ditto his wife, Susan, who is utterly charming and a rock) – it might be better to start afresh. 'New PM in London, new Ambassador – fresh start Old Chap…' You see there is nothing so Foreign Office as to make a chap a Knight before pushing him out to retirement.
If you’re still hanging in there with me on this post, you’ll recall I said that two names caught my eye. The other was Oleg Gordievsky. He’s been made a CMG! Astonishing! (a) It is bad form, IMHO, ever to give Honours to traitors, however much we’ve been grateful for their treachery. He betrayed his country so, res ipsa loquitur, he is not an honourable bloke and we shouldn’t honour him. Sorry old thing and all that. (b) Given the current state of Russo-British relations, isn’t this just sticking one finger up at VVP?
I know Blair is pissed off with President Putin, but I wonder if this honour for Gordievsky doesn’t mean Her Majesty hasn’t been put in the position of being graciously pleased to tell VVP: ‘Up Yours Volodya!’
* Big Exception to Rule. There are five Honours – since you ask, you didn’t? Oh well... – which are not the choice of the Government but the personal gift of the Sovereign:
o The Knights Garter – hugely grand, only 24 living at any one time
o The Knights Thistle – seems slightly Da Vinci Code I know – the 16 Knights Garter for Scotland, as it were
o The Order of Merit – think “Stalin personally wanted to make me a People’s Artist of the Soviet Union”-equivalent
o The Royal Victorian Order – gift for loyal palace servants, grand and not-so-grand
o Royal Victorian Chain – I know, sounds like something with which to flush the royal loo, but actually it's wildly über-grand: usually the Monarch’s quietly-dignified way of saying ‘thank you for being my friend’
Interestingly, I suspect aristo-chattering class London will be more interested in the Knight Grand Cross given to Sir Robin Janvrin; currently the Queen’s Private Secretary. Already a Knight of the Order of the Bath – very grand order this, technically fourth in the British Orders of Chivalry - he would I think have got it anyway in the New Year’s Honours List (he retires in September).
It’s the timing you see. In the strangely moving and rather good film, The Queen,
he is portrayed (no fault of the actor this, who is a fine English character actor) as something of an unctuous toady. People who know Robin Janvrin thought that characterization of him terribly unfair. And clearly so did HM. To get his ‘G’ right now (so having the letters GCB after his name, or God Calls Back) sends a subtle message, clearly understood, across all the right breakfast tables in town and country.
Odd. When I was a teenager I desperately wanted to be a diplomat and – slightly scary really – imagined myself, forty-something swishing around with my ‘K’, as Ambassador somewhere in a glamorous ‘hardship posting’ like….oh… El Salvador or Suharto-era Jakarta. Very Saigon, Year of the Cat etc. At Cambridge I came to realise that I was not the type. That, and the realization I was just not fiercely bright-enough ever to be a QC (so why bother with law at all, I concluded) were two of the three biggest disappointments of my life (the third, when I was at drama school – don’t ask, I did later go to a real school too – was being told “you don’t have the face to be Hamlet, but don’t worry sweetheart, one day you’ll grow into a marvelous Polonius. You have a character actor’s face!" I was fourteen).
Why did that thought crop into my head? Silly. Ended. Anyway, this afternoon I shall write a couple of congratulatory notes to a couple of other people I know on today’s list…funny old world.
In Moscow, IBM held a rather brilliant forum on New Media yesterday. Respect! Of course, no where in this new media celebration does it mention China and State censorship of access to web 2.0. And this, of course, will be the only litmus test that will really matter about what Russia is, or is not.
For those that fear the bear - or just want to bait it - the lack of Net censorship (cf China) massively undermines their case. For the Russophiles, if the Russian Federation adopts Chinese-style Net censorship, then the Russophobes will have won. Hands down. Either way, I hear the answer, definitively, will have become clear (or not) by next February.
Shout out to Arseniy Rastorguev for injecting this into the Russian blogophere.
Thursday, 14 June 2007
Actually my notebook always crashes if I even try to post anything the tiniest bit Russophobic so I think the FSB (or my largest client) has installed some clever widget to that effect… Alternatively, at three years old, probably around 8,000 active hours and having been dropped not so long ago at Sheremetyevo airport (there’s the sweetest crack where the fan-thingy sits), maybe it needs replacing
But it is very light to carry, I have a second battery for it and I think it is kind of cool-looking. I would miss it (our new supplier is, exclusively, Lenovo…I have yet to fall in love with any of their products): I also fiercely don’t want to be messed about with by Microsoft Vista because you just know it won’t work with my HP iPAQ – on point of principle I guess – so I shall eek out every last drop of life from my cool little Samsung for as long as I can… unless I decide to go ahead and personally buy one of these babies.
Wednesday, 6 June 2007
…on Russo-Western relations and I tippy-tap emails and simultaneously watch BBC World. I have just been watching Hard Talk, with the quite excellent Stephen Sackur.
Today’s freshly-minted edition starred Marina Litvinenko and Berezovsky-paid side-kick, Alex Goldfarb. Normally, Hard Talk isn’t a tag-team interview event, but allowances I suspect were made for the widow in her non-native tongue. Whatever one else thinks, she is a widow after all.
Actually, I thought the BBC handled the issue perfectly: this was no easy ride for the widow and the odious Goldfarb (who, like an old courtesan has been passed first from the Court of King Soros, to be picked up by Prince Boris). Goldfarb, in my humble opinion, is the epitome of the slick, smooth-tongued, high-performance PR man: personally, I wouldn’t trust a word he says; no matter how well he says it.
Anyway, in this program at least – if not in the mainstream, rabidly anti-Russian British media – the BBC had a fair crack at exposing the ABSURDITY that the Russian Government had anything to do with the policeman – hardly a spy – Litvinenko’s untimely death. Interestingly, early on in the program, I thought both widow and Goldfarb looked distinctly shifty about ‘whose words were those?’ (apropos the infamous statement, allegedly dying Litvinenko’s own words, where he said he had been murdered on the orders of VVP).
Overall, I thought Goldfarb’s snow-job sufficiently undermining for the reasonable viewer to conclude: ‘of course, President Putin didn’t order his death’. If only because the use of Polonium 210 is so desperately sneaky-nuclear-power it is as melodramatic a false-flag as that moment in Agatha Christie’s Death on the Nile; when the killer uses the dead victim’s bloody finger to sign out the name of the person they would want framed… and the analogy fits to the extent that some Diaspora-oligarch has bought some rag-tag hangovers, from KGB days, who have used post-Soviet technology against the state that made it… enough already: I am so bored of the Litvinenko thing, it’s like he’s died twice and we’re looped in endless re-runs!
In fairness though, I thought I would repeat this email exchange:
Sent: 05 June 2007 11:47
To: [‘prince of darkness’ – black PR mate] [UK political mate]; [Documentary TV producer mate]; [lawyer mate]; [BBC TV mate]; [entrepreneur mate]
Subject: Coming to London
I am scooting to London on the last BA tonight. Thursday is the Russo-British Chamber of Commerce’s annual Business Summit which I usually avoid like the plague, but I have bracketed it with some meetings. It seemed a good time to come over while the British seem intent on provoking Russia to herald a slightly chilly tiff, if not the ‘cold war II’ that some forces in Washington and Israel would like to see started…
Anyway, I have a gap for pre-dinner drinks; and/or separately dinner, Thursday evening: would anyone be free for either?
From: [UK political mate]
Sent: Tuesday, June 05, 2007 4:16 PM
Subject: RE: Coming to London
What a shame: I will be watching Beating the Retreat and having dinner after. With the increased tension being generated by your adopted President, the opportunity to see what our boys can do (albeit ceremonially) will be good for my morale.
By the way, I must remember that if I ever put up a fence in my back garden to be wary of my neighbours saying "right then, I'm going to get ready to lob some stones over it".
Meanwhile, it's nice for Peter Tatchell that having spent the last 10 years being set upon by Zimbabweans that he can now travel to Russia to be met with the same treatment. Apparently he was all set for a cosy evening at the Lubyanka until the police realised that he had some political celebrity and let him go. Still, it's good to see that Putin is relaxed about allowing some "people power". The way that the state security services allowed gangs of right-wing youths to freely give vent to their views on homosexuality is an eloquent rebuttal to those who would claim that freedom of expression is an outmoded concept in the Motherland.
I wonder if, just before you come over, you could commit some crime - perhaps the murder of a Russian citizen? That way when the Russian police track you down to London and try and extradite you, you could accuse them of being naive and political.
Yours, feeling the comforting nostalgic chill of the 70s and 80s and hoping it leads to a reinstatement of a 50 ship frigate-destroyer fleet and finally puts the seal agreeing the replacement of Trident!
Yes, it’s going to be a nasty, overly-rhetorical summer; especially given the speech I have just seen President Bush give in Prague…