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IN FOCUS OF THE RUSSIAN PRESS

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Gazeta.ru: Prospects for European integration on the wane; Vedomosti: Russia has something to offer potential partners in the Arctic; Kommersant: Gazprom seeking privileges for South Stream pipeline; Nezavisimoye Voyennoye Obozreniye: New Russian missile system undermines Western European arms trade; RBC Daily: Russian police promised European salaries. 

Gazeta.ru: Prospects for European integration on the wane

For Europe, which after the Cold War saw itself as an independent power center, the single currency was supposed to serve as a springboard to launch it to a new level, but the breakthrough never came, a Russian analyst writes.

Fyodor Lukyanov, editor-in-chief of the Moscow magazine Russia in Global Affairs, writes that integration was Europe's biggest achievement of the 20th century. During the best periods of its development, it relied on clear political goals and rational economic instruments.

The European community was a forerunner of a better future, with borders increasingly porous and a socially friendly market growing in strength. Europe found an ideal way to demonstrate its leadership capability: through setting a positive example rather than the use of force.

However, these noble aspirations have withered, the analyst writes. Now that it has become critically important to create an economic alternative to the United States and promote currency diversification, Europe is not using its capabilities to the full. And the reason is not the global recession but a conceptual crisis afflicting European integration, Lukyanov writes.

This policy of expansion had a negative effect on the EU, because it disrupted its internal balance. But it would be unfair to blame current problems on the central and eastern European countries.

When the global crisis began, the new EU members were the first to be affected. But Latvia, Lithuania and Hungary, which have taken painful measures to improve their economies to be able to join the EU, are overcoming the crisis. So the problem lies elsewhere.

The EU can force Latvia or Lithuania to tighten their belts, but it is extremely difficult to pressure Greece, which is ready to start fighting for its "rights" at the slightest provocation. And Italy and Spain are likely to rebel too, Lukyanov writes.

Large European countries, which are blaming the current problems on others, must also admit they are partly responsible. When France and Germany exceeded the 3% budget deficit limit in 2002, the EU started to reform the Stability and Growth Pact (SGP), rendering the pact useless.

Britain's current deficit (12.6%) is only slightly smaller than that of Greece (13.6%).

Europe has pushed itself into a vicious circle. It must help Greece or face unpredictable consequences throughout the whole Euro zone. But helping Greece would amount to encouraging irresponsible economic and financial policies by shifting the burden to honest taxpayers in other countries.

The EU should consider excluding Greece from the Euro zone on economic grounds, but a return to the national currency may destroy the Greek economy and deliver a heavy blow to the common currency. Therefore, the EU has to save Greece, the analyst writes.

Europe, whose policy of gradual development was its strong suit during integration, is lagging behind accelerating globalization. As a result, that harmonious structure, which it built so lovingly, has become distorted and is trying in vain to support itself. Europe is falling behind global development and relinquishing its global role.

The common currency, the biggest and most far-reaching of all of the EU projects, is the last remaining symbol of European ambition, Lukyanov writes.

Vedomosti: Russia has something to offer potential partners in the Arctic

While a century ago the mysterious icy expanse in the Far North only attracted adventurers, today the Arctic and its unexplored riches have become of keen interest to more pragmatic types: businessmen and politicians.

The moves taken by Russia, the United States and Canada are often reminiscent of the old competition practices used by Spanish and Portuguese conquistadors in South America and by Europeans establishing colonial rule in Africa. But cooperation would certainly yield greater benefits.

It is feared that the vast and poorly regulated northern areas could be used for launching missiles or taking other hostile action, but most military analysts reject this possibility. It is more important to determine who will develop the mineral and biological resources of the Arctic Ocean and how.

The Barents Sea, only recently demarcated by Russia and Norway, holds an estimated 7.6 billion metric tons of oil equivalent. Scientists and oil professionals are now debating the total amount of offshore deposits. According to a study by United States Geological Survey, the Arctic may hold around 50 trillion cubic meters of gas and about 90 billion barrels of unexplored oil. This is more than the combined resources of Nigeria, Kazakhstan, and Mexico. According to the U.S. Department of Energy, the Far North accounts for 22% of the world's unexplored hydrocarbons. Russia's Nature Ministry estimates recoverable resources in Russia's Arctic zone at 120 billion barrels of oil and nearly 85 trillion cubic meters of gas.

Hydrocarbons and fish are not the Arctic's only resources.

The northern sea route along the Russian coast is used for delivering supplies to remote areas of Siberia and the Far East as well as for bringing back Russian companies' polar products.

Regular shipping services will make this route from northwestern Europe and the U.S. East Coast to the Far East more attractive than the traditional one via the Suez Canal.

Scientists at Cambridge University predict that by 2020 ships will be able to cross the Arctic waters unaccompanied by icebreakers.

Russian scientists do not believe the ice will melt that fast, so commercial navigation will be impossible without Russia's icebreaker fleet, which incidentally boosted its position as a global leader with new vessels commissioned last year.

Deep level offshore oil and gas prospecting, production and delivery in such a harsh climate require a colossal investment. Rosneft president Sergei Bogdanchikov estimated that the development of Russia's offshore zone will require $2.5 billion through to 2050. The Arctic nations must eventually admit they need joint projects to deal with the Arctic's extreme environment.

Kommersant: Gazprom seeking privileges for South Stream pipeline

Gazprom will seek the lifting of the EU rules for the Austrian section of the South Stream gas pipeline. The rules require that third parties have access to gas pumping, which reduces the project's cost recovery. In return, the EU may ask for concessions on gas supplies, analysts believe.

The European Commission assigns a TEN (Trans-European Networks) status to key projects aimed at ensuring sustainable development and reliability of natural gas supplies to European consumers. "A separate permit needs to be obtained in each EU country prior to launching the project," said Gazprom spokesperson Sergei Kupriyanov.

The competing EU-sponsored gas pipeline project Nabucco obtained all the necessary permits in the countries the pipeline will be laid through as far back as in February 2008.

Similar status has been assigned to two Russian pipelines, the Nord Stream (specifically, for the overland section in Germany, the Opal pipeline) and the Yamal-Europe pipeline.

Marlene Holzner, a spokeswoman for the EU energy commissioner, said that under the EU Gas Directive, an exemption for the third party access rule can be provided for major infrastructure projects.

"EU members or national regulators can provide such exemptions under certain conditions: The investments must stimulate competition, and the infrastructure must be owned by a company, not linked with the country's system operator," Holzner explained. "The European Commission can amend or cancel the decision within two months after receiving the request from an EU member state or a company." Holzner could not comment yesterday on whether South Stream would be granted TEN status.

According to the head of the OMV press service, Michaela Huber, the issue of lifting the restrictions for South Stream may only be resolved "towards the end of the year, when there is a project feasibility study." Gazprom CEO Alexei Miller said recently that the feasibility study would only be ready in February 2011.

Maxim Shein from BrokerCreditService believes that Gazprom will have to make concessions on current gas supplies to EU member states to obtain TEN status for South Stream.

Mikhail Korchemkin, head of the U.S.-based East European Gas Analysis, said that Gazprom will face some difficulties in obtaining such permits, for example, in Bulgaria, whose new government is much less enthusiastic about energy deals with Russia.

Nezavisimoye Voyennoye Obozreniye: New Russian missile system undermines Western European arms trade

Western media are alarmed because Russia's Club-K Container Missile System, designated to hit surface and land targets with 3л-54рE, 3л-54рE1 and 3л-14рE cruise missiles, could change the global balance of power forever and facilitate the proliferation of ballistic missiles.

The appearance of any hi-tech Russian product that has no Western counterpart always triggers an intense campaign, putting pressure on national arms exporters.

The British newspaper The Daily Telegraph wrote that it fears it could be possible to hide the deadly new Russian weapon inside a standard 40-foot (12-meter) container, meaning any merchant vessel could wipe out an aircraft carrier.

Robert Hewson, the editor of London-based Jane's Air-Launched Weapons, said: "The idea that you can hide a missile system in a box and drive it around without anyone knowing is pretty new and nobody's ever done that before.

"At a stroke, the Club-K gives a long-range precision strike capability to ordinary vehicles that can be moved to almost any place on earth without attracting attention," Hewson stressed.

Most of all, British analysts are worried that the Club-K could fall into the hands of such "rogue states" as Venezuela and Iran and could seriously enhance their defense capability in case of any hypothetical aggression by the United States and its allies.

Israel is also concerned that Club-K systems could reach Hezbollah terrorists via Syria.

The seemingly terrifying Club-K system makes it possible to convert any merchant ship into a warship should a conflict arise. Any coastal or insular country would therefore be able to deploy a small navy capable of attacking enemy task forces.

The $15 million Club-K is a cheap and effective defensive weapon costing a 10th of the price of a coastal frigate or corvette.

Poor countries with long shorelines will find this a good alternative to purchasing expensive Western European equipment.

Spanish frigates, German submarines, French missile systems, Italian helicopters and other weaponry and their components manufactured in 15 countries could lose a large market share.

The London media howled in outrage when countries such as the United Arab Emirates, a reputable customer, started eying the Russian multi-role missile containers. 

RBC Daily: Russian police promised European salaries

Russian authorities have found the easiest way to combat corruption in the law-enforcement agencies: the salaries of policemen will be tripled. But analysts do not think this will do anything to change corrupt law-enforcers who are giddy with power. Besides, the reform will place a heavy burden on the budget.

"The average monthly salary will be increased to 35,000 rubles ($1,195) for rank-and-file police and to 55,000 rubles ($1,880) for criminal police," Interior Minister Rashid Nurgaliyev said at a meeting of the Security Committee of the State Duma, the lower house of parliament.

"According to initial estimates, salaries will be raised by approximately 190%," he said, adding that this would bring their income up to European standards.

The day before, Vladimir Kolokoltsev, head of the Interior Ministry's Moscow department, raised the salaries of the Moscow police. He said they would earn about 60,000 a month by the end of the year.

"I don't think the government can finance such pay rises," said Alexei Makarkin, vice president of the Center for Political Technologies. "The [Russian] budget depends on commodities and price fluctuations, and so the Finance Ministry is unlikely to find the necessary funds for this."

Maybe the reform should begin with increasing salaries for some kinds of police officers, for example those who investigate economic crimes or who work in particularly high risk areas, Makarkin said.

Mikhail Pashkin, chairman of the Moscow police trade union, also said the government is unlikely to find the funds soon.

"It will have to allocate an additional 35 billion rubles for the Moscow police alone and at least 500 billion rubles for the whole of Russia," he said.

Nurgaliyev said that a considerable proportion of the funds would come from a 20% cut in the number of personnel and redistribution of the wage fund among the remaining police.

Approximately 280,000 policemen are to be dismissed over the next two years.

"An increase in salaries accompanied by layoffs will not resolve the problem of police corruption," said Valentin Gefter, director of the Human Rights Institute.

"If a rank-and-file policeman is paid 35,000 rubles a month, he might not demand 35 rubles from a granny in the street. But I don't think kickbacks for senior officials will diminish," he said. "Likewise, I don't think the tradition of 'sharing' will be forgotten simply because salaries were raised."

"Salaries should be raised simultaneously with a thorough campaign to clean up the police," Makarkin said. "Those who have been infected with the virus of corruption will continue to take [and demand] bribes irrespective of the size of their salaries."

April 30, 2010 

RIA Novosti




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