Russia Reform Monitor: No. 1855

October 20:

Estonian officials accused the Kremlin of interfering in local politics after a mayoral candidate was placed on Interpol’s most wanted list only days ahead of municipal elections. Bloomberg reports that Eerik-Niiles Kross, a member of the junior coalition party Isamaa ja Res Publica Liit, is currently sought by Russia on suspicion of organizing piracy, in connection with the hijacking of the Russian freighter Arctic Sea four years ago. Estonian leaders reportedly plan to file a complaint with Interpol that the charges against Kross are politically motivated. “Earlier they wanted to get back at Kross for his work in defending Georgia’s independence,” insisted one official, referring to Kross's work advising Georgian authorities during and after the country’s five-day war with Russia in 2008. “Now they want to affect tomorrow’s vote so that Savisaar stays in power.”

October 21:

The shifting global energy market could signal major troubles ahead for Russia’s state energy companies. Radio Free Europe/Radio Liberty reports that the development of new LNG technology, which allows natural gas to be shipped more easily, has produced a new threat to the regional dominance formerly enjoyed by companies like Gazprom and Rosneft. Both have long relied on the Soviet-era business model of dictating terms both the former Soviet satellites and Europe, but profits fell 15 percent in 2012, and exports to Europe dropped by eight percent. Corruption issues do nothing to help the problem – last year’s Transparency International rankings saw Gazprom as the only company on a list of the world’s 105 largest organizations to score a zero in terms of effective anticorruption methods. Analysts estimate that Gazprom may lose up to $40 billion annually to corruption and waste, nearly 40 percent of total revenue.

At least six people died in southern Russia after a female suicide bomber detonated an explosive. It was the deadliest such attack outside the North Caucasus in almost three years, Reuters reports, as another 28 people were wounded in the blast. No organization has claimed responsibility for the attack, but experts suggest it was likely orchestrated to raise fears of further terrorist attacks ahead of February’s Olympic Games in Sochi.

October 22:

The Kremlin’s bullying seems to become less subtle as more of its former Soviet satellites shift their focus westward, reports The New York Times. Moldova, already Europe’s poorest country, has become the latest victim to Russia’s tactics, ahead of a conference next month at which Moldovan leaders are expected to sign several political and trade agreements with the European Union. At a state visit last month, Deputy Prime Minister Dmitri Rogozin called such agreements “a grave mistake,” and even warned the country, which is entirely dependent on Russian gas for heat, “We hope that you will not freeze.” Only days later, Russian officials banned imports of Moldovan wine, a key export, citing unspecified “health concerns.” In spite of these moves, however, Moldova’s leaders say their resolve to complete agreements with the EU has only been cemented. “The signing of these agreements is the only chance that Moldova has in order to develop itself as a European country and in the European spirit,” insisted Moldovan President Nicolae Timofti.

October 23:

As Egypt-U.S. relations continue to cool, Cairo has begun to strengthen its relationships elsewhere – including with Russia. Earlier this month, Asharq Al-Awsat reports U.S. President Barack Obama ordered a suspension of $260 million of financial aid to the Egyptian military, and a revision of the $1.5 billion a year of aid it previously provided to Egypt. The White House noted that the decision marks an end to years of unconditional aid to Egypt, and will affect several pending deliveries, including Apache helicopters, F-16 fighter jets, and Abrams tanks. Egyptian officials denied that an upcoming delegation to Moscow is an attempt to replace that relationship, but one official did say that “we will endeavor to achieve a balance which befits Egypt’s historic, geographic, and strategic stature, and the current global climate necessitates that Egypt looks East to achieve this.”

October 24:
Russian officials reacted angrily after a report appeared in The Washington Post accusing Yuri Zaitsev, the director of a U.S.-based cultural exchange program, of recruiting Americans as potential Russian intelligence assets. The Russian Foreign Ministry flatly denied the claims, reports Voice of Russia, while Zaitsev himself insisted that the claims were an attempt to derail the program. “Apparently,” he said, “someone does not like that we are doing good things; together with the Americans we are doing it for the benefit of Russia and the USA.” He added “I believe that American citizens and the mass media, including Russian, will somehow understand what is happening...It’s just a ‘frosting’ in the relations and an attempt to discredit, in my opinion, a good program.”