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Russian economy being prepared for second wave of pandemic

Wed, 20/05/2020 - 18:56
The second wave of the pandemic may arrive sooner than we expect, and the world will have to deal with it. Russia needs to change her approach to planning and business processes, experts say. The leaders of the Federal Reserve System, the International Monetary Fund and the World Economic Forum announced that it would take economy several years to recover from the current crisis completely. Analysts believe that the current crisis in the Russian Federation is similar to the pre-war situation. The main problem is seen in the new growth of the number of infections in China. As many as 40 cases of the coronavirus infection have been recently found in the city of Shulan in Jilin province, which borders on the Russian Federation. The Chinese authorities decided to close the city, similarly to the practice they used in relation to Wuhan. Experts believe that in the United States, the coronavirus is going to come back again along with seasonal flu. Elena Malinnikova, the chief freelance specialists for infectious disease at the Ministry of Health of the Russian Federation, believes that the pandemic of the new coronavirus infection in Russia will end by July. However, many financiers surveyed by Deutsche Bank, (55%), believe that coronavirus-caused problems are going to return.
Categories: Russia & CIS

Russian doctors fight for COVID-19 compensations

Tue, 19/05/2020 - 21:28
The first criminal case in Russia regarding the non-payment of compensations to medical personnel working with coronavirus patients was initiated in the Krasnodar region, the press service of the Investigative Committee of the Russian Federation said. The case was filed in the town of Armavir under Part 1 of Art. 293 of the Criminal Code of the Russian Federation (negligence) following a pre-investigation into the non-payment of incentive payments to doctors for their work and working conditions during the coronavirus pandemic. On May 16, a video message of ER doctors of Armavir was posted on the Internet. In their message, the doctors said that they did not receive any financial assistance for their work in the conditions of the COVID-19 pandemic. It was said that the violation of the rights of doctors to receive incentive payments "became possible due to acts of negligence committed by the administration of the medical institution."
Categories: Russia & CIS

Gazprom flings the gauntlet to USA

Fri, 15/05/2020 - 18:23
Gazprom, Russia’s natural gas monopoly, with the help of the Akademik Chersky pipe-laying vessel, is going to build the remaining 160 km of Nord Stream-2 gas pipeline. This is a challenge for the United States. The Akademik Chersky pipe-layer is currently anchored in the German port of Mukran, where it is being loaded with pipes for Nord Stream-2, Bloomberg reports.  The agency substantiates its point with satellite images of the ship off the port of Mukran. The photos, published by Planet Labs Inc., show that sections of the gas pipeline, which were in storage near the harbor, have been moved to the pier for loading. Thus, the agency concludes, Gazprom is moving the construction of the Trans-Baltic gas pipeline to the final stage.
Categories: Russia & CIS

Why is OPEC+ deal a failure for Russia?

Tue, 14/04/2020 - 20:39
The OPEC+ deal to cut oil production is a failure that Russia has suffered, some analysts believe. As part of the deal, Russia's decrease in oil output would be larger than that of Saudi Arabia. To crown it all, the Americans did not take any written obligations at all. Why is the deal a failure for Russia? Under the terms of the agreement, Russia and Saudi Arabia are supposed to reduce oil production in May-June by 2.5 million barrels per day each from the current level of 11 million barrels per day. Russia's current obligations are four times as much as in early March of this year, when the previous OPEC + deal fell apart. Sources in the Kremlin called the agreement a "painful failure," while adding that the deal is a relief for Moscow. They are forced measures that Russia has to accept as a result of the pandemic of the coronavirus infection, as if this applies only to Russia ... Andrei Nechaev, former minister of economy of the Russian Federation is not happy either. Referring to experts' estimates, he noted that "Russia's oil export revenues would be halved, because it is export that would need to be cut in the first place." "This is the price of the affair to terminate relations with Russia in the previous OPEC+ deal. Russia had to apologize to the allies, whom Russia had been deceiving for three years without cutting production, but increasing it under the guise of solidarity statements. Now control will be tight, while severe violations will be punishable with sanctions. It is all Russian people who will have to pay for this affair,"Mr. Nechaev predicts. Leonid Fedun, co-owner of Lukoil, said in an interview with RBC that the current deal was similar to the Brest Peace of 1918 - it is humiliating and difficult, but necessary. According to Fedun, the deal will provide a price level for Russian oil at $30-40 per barrel instead of $15-20.
Categories: Russia & CIS

Illegal migrants will make Covid-19 last longer

Tue, 07/04/2020 - 21:13
Illegal migrants are a potential source of COVID-19 in Russia, just like in many other countries too. They are not welcome at their home countries, but they cannot leave Russia either. It is unclear what they can do about their situation, nor do we know what the authorities are going to do about them either. According to the Ministry of Internal Affairs of the Russian Federation, there are 2.5 million migrant workers in Russia. During the coronavirus pandemic, they lost their jobs and wanted to return home, but they could not. From March 18 to May 1, 2020, Russia closed borders to all foreign citizens to prevent the spread of the deadly infection. In this regard, the Russian authorities allowed migrants to renew their patents in Russia. Legal migrants have a compulsory medical insurance policy, so this contingent will receive the required medical assistance. The leaders of post-Soviet republics try to take care of their citizens. For example, Tajik Ambassador to Russia Imomuddin Sattorov sent an appeal to the Russian government with a request for tax "holidays" for his compatriots in Russia. If the Russian government satisfies his request, it will be forced to take similar measures in relation to migrants from other countries. This request has its lobbyists in Russia, because by accommodating migrants, usually without proper social guarantees, businesses save up to 40 percent in construction and utilities by reducing production costs. Legal migrants will find work after quarantine ends.
Categories: Russia & CIS

Russia Sends Humanitarian Aid to the US

Tue, 07/04/2020 - 17:46
Russia Sends Humanitarian Aid to the US  A Russian military plane headed from Moscow to the United States on Wednesday (1) loaded with medical equipment, including masks, to help the United States fight the coronavirus pandemic, where 240,000 people are infected and over 5,000 have already died from the COVID-19.  Moscow decided to help Washington on Monday (30), after a telephone conversation between Russian Federation President Vladimir Putin and US President Donald Trump, in which both officials discussed how they could more efficiently fight COVID-19.
Categories: Russia & CIS

Coronavirus to throw Russia into two years of economic stagnation

Mon, 06/04/2020 - 17:39
As the coronavirus pandemic is gathering pace, the global economic crisis is looming. Putin's decision to extend the non-working regime in the Russian Federation for a whole month, until the end of April, will show an extraordinary and enormous influence on the Russian economy. This decision caused a lot of controversy, but, as Putin's official spokesman Dmitry Peskov said, people's health is more important. The Kremlin considers various scenarios of the development of the economic crisis in Russia. The current state of affairs in the Russian economy falls under the concept of the perfect storm: several major factors work together to cause the economy of Russia to tailspin. It goes about the coronavirus pandemic the decline in oil prices the devaluation of the Russian currency, the ruble, a decline in consumer demand, etc. It appears that there is nothing but negativity around, and there is no light at the end of the tunnel.
Categories: Russia & CIS

Wealthy Russians escape from the West back home

Mon, 30/03/2020 - 18:58
Maria Zakharova, an official spokesperson for the Russian Foreign Ministry, wrote on her Facebook page that the Office of the Foreign Ministry of the Russian Federation receives many calls and emails from Russians living in other countries, who ask the department to help them or their relatives return to Russia due to the closure of flights and borders. According to Zakharova, some "very rich" people called and said they wanted to send a private jet to London "to pick up their boy who has been living there for a long time and fly him over to Moscow." When the person was asked why they wanted to bring the boy back home to Russia, the caller responded that the British authorities canceled health insurance policies for foreigners, so every foreigner residing in the UK now has to pay a lot of money for healthcare services. "You have been fooled for so many years and you have been paying for it - you have been paying gold for decay, for an illusion, instead of supporting your country and your people, who, with titanic efforts, patience and love have been restoring after the collapse of the USSR and chaos of the 1990s," responded Zakharova. "You were buying real estate and building business there, but when you were shown the door, you are standing in lines at airports of the world screaming: "We are Russian citizens!" while blowing dust off your Russian passports," Zakharova wrote.
Categories: Russia & CIS

What's in store for the Russian economy?

Fri, 20/03/2020 - 19:03
One dollar was traded at a rate of 82 rubles on the Forex market, while the euro was already worth 90 rubles. On March 19, the ruble exchange rate reached 81.97 per dollar (the highest rate since January 2016) at the Moscow Exchange, and the euro - 89.6 rubles (the highest rate since February 2016). The Russian ruble has been recognized the most volatile currency in the world after the Mexican peso against the backdrop of the coronavirus pandemic and the disruption of the OPEC deal. Russia is going to face even more stressful scenarios, because the oil price may drop to $20. A few days ago, WTI crude oil was traded at $23 per barrel - this is the lowest level for the last 18 years. If this happens, the value of the US dollar will rise over 90 rubles. Many companies may experience bankruptcies and production problems, to say the least. On March 20, the Central Bank of the Russian Federation is to have a meeting to discuss the key rate. If the US dollar hits the level of 90 rubles, the Bank may resort to currency interventions on the currency market to lower risks to financial stability. In the meantime, the Central Bank sells foreign currency in small volumes evaluated at 3.6-5.5 billion rubles per day, instead of buying it under the fiscal rule. Market participants are waiting for the government to take action, but the action is not coming. So far, the ruble and the market has been following the oil prices, and investors are not leaving the Russian market.
Categories: Russia & CIS

Valentina Tereshkova resets Vladimir Putin’s life to zero

Thu, 12/03/2020 - 16:44
Valentina Tereshkova, who currently serves as a deputy of the ruling United Russia party, took advantage of an opportunity to support the constitutional construction of her nation for the second time in a lifetime. During the times of Leonid Brezhnev, in her October 1977 appeal, Valentina Tereshkova thanked the party, the CPSU Central Committee, and Leonid Brezhnev personally for their work on the text of the new Constitution of the USSR. In the era of sanctions and import substitution, Tereshkova, first woman in space, also expressed her gratitude to the Russian leader and unpretentiously proposed to reset his presidential term to zero and start the countdown again. In other words, she suggested Putin should stay in power before 2036 and then before 2048 - for life that is. Putin likes zero Vladimir Putin, speaking before the State Duma, said that Russia was still overcoming consequences of the collapse of the Soviet Union. Apparently, we should be happy that the country has been able to leave behind the legacy of the Golden Horde and the devastation after the Patriotic War of 1812. The head of state noted that he considers the change of power to be important, but...:
Categories: Russia & CIS

Oil crisis 2020: The war has begun

Tue, 10/03/2020 - 16:17
During the talks in Vienna, the Saudis proposed lowering oil output by 1.5 million barrels per day during the second quarter of the current year in response to the coronavirus epidemic and a downturn in global demand, which, according to Goldman Sachs estimates, could exceed two million barrels per day. Russia, in the person of Energy Minister Alexander Novak, flatly refused to reduce production and only proposed to set current production volumes for another quarter. Riyadh turned the offer down. The next day, global markets collapsed, the ruble lost ten percent of its value against the dollar. Russian oil companies have long wanted to exit the deal: OPEC+ was favored only by those companies that were developing no new deposits and had no opportunity to increase production on old ones. It goes about such companies as Lukoil. Its top manager Leonid Fedun announced that the decline in oil prices after the failure of negotiations with OPEC could lead to a loss of $100-150 million per day. It could be true, but one can win the game by sacrificing a pawn. Many analysts believe that Russia should have left the deal long ago as Russian companies were losing their part of the market and could not invest in new deposits.
Categories: Russia & CIS

Erdogan will break his agreements with Putin as soon as he can

Fri, 06/03/2020 - 16:49
The talks between Russian President Vladimir Putin and his Turkish counterpart Recep Erdogan ended in Moscow late at night on March 5. The two presidents met to discuss the crisis in Syria's Idlib. The agreement reached includes: cessation of all hostilities along the existing line of contact from midnight on March 6; establishment of a six-kilometer-wide safety corridor north and south of M4 highway in Syria; joint patrolling along M4 highway starting from March 15. Obviously, Ankara has come to terms with the loss of control over M5 highway and the city of Saraqib. Probably, Turkish observation posts south of M4 highway will be curtailed. Foreign Minister Sergei Lavrov said the terrorist groups, which the UN recognizes as terrorist ones, will be destroyed in Idlib by both parties together.
Categories: Russia & CIS

Vladislav Surkov, grey cardinal of the Kremlin, flushes Ukraine down the toilet

Wed, 26/02/2020 - 19:13
Vladislav Surkov, former assistant to President of Russia, whom Vladimir Putin dismissed on February 18, gave his first interview after his resignation. According to Surkov, who gave an interview to Actual Comments website, he has no plans to return to public service, although he still wants to stay in politics. It is worthy of note that Vladislav Surkov was in charge of Russia's policies in relation to Ukraine as he was staying in his office as assistant to president. Surkov claimed that his resignation took place at his own request. "I did it myself, it was my own wish," he said.
Categories: Russia & CIS

Putin speaks about special operation to replace Medvedev’s government

Thu, 20/02/2020 - 12:25
Vladimir Putin said in his recent interview with TASS news agency that the former chief of the Federal Tax Service, Mikhail Mishustin, was not initially on the list of four candidates for the new prime minister. The resignation of Dmitry Medvedev's government was not a "special operation", and the tandem with Dmitry Medvedev did not break up either. In the interview, which was held in a new format elaborated specifically for social networks, TASS observer Andrei Vandenko asked 20 questions to President Putin. The number of questions coincided with the number of years, which Putin has been staying in power in Russia. Putin did not agree with the assumption that the resignation of Medvedev's government, which took place an hour after the announcement of Putin's Address to the Federal Assembly on January 15, was carried out as a special operation. When the interviewer noted that the reshuffling made many believe that it was all done in a rush, Putin said that Russia was not Belgium: it is impossible to dissolve the government and then live without a government for a whole year. "Would it be better to dismiss the government, and then form it for six months? Can you imagine what it would lead to?" Putin said.
Categories: Russia & CIS

Those who spill Putin’s beans in corporate Russia have to go

Fri, 24/01/2020 - 19:30
The government of Dmitry Medvedev has resigned. Medvedev failed to meet the requirements of many of Putin's decrees, but Putin takes every effort to make the lives of former governmental officials comfortable by moving them to other high-ranking positions. Is there any place for the feeling for patriotism? And Medvedev's government goes to... It became known that: ex-Prime Minister Dmitry Medvedev will work at the Security Council of the Russian Federation. There was a new position established especially for him - deputy chairman of the Security Council. Medvedev will thus deal with issues of improving the defense capability and security of the Russian Federation. Frankly speaking, security officials can hardly be happy to see Medvedev in their ranks.   Maxim Topilin, the former Minister of Labor and Social Protection, who "defended" Russian pensioners by raising the retirement age, became ... the head of the Pension Fund. The former head of the Pension Fund, billionaire Anton Drozdov, who could not find any funds to index pensions for working pensioners for 4 years, was appointed to the position of Deputy Minister of Finance. The money to raise pensions for working pensioners was quickly found now. Veronika Skvortsova, the former Minister of Health, who was unaware of the amount of real salaries of doctors in Russia, took the position of the head of the Federal Medical and Biological Agency. In other words, having failed in the field of primary health care, her new duty is to control it. Vitaly Mutko, who was responsible for construction and housing in Medvede's government, could never manage to put things in order in both of those spheres. Moreover, when Mutko served on his previous position of the Minister for Sports, the doping scandal started. According to Grigory Rodchenkov, it was Mutko who was coordinating the substitution of samples with him. According to RBC, Mutko may take the post of the head of the state-owned investment company Dom.rf. For ex-Minister of Culture Vladimir Medinsky, Putin personally promised to find a good place. He was appointed assistant to the president for culture, that is, he will become the curator of the industry. The former head of the Ministry for Economic Development, Maxim Oreshkin, was appointed to a similar position. Former Deputy Prime Minister Dmitry Kozak, who was responsible for economic cooperation with Ukraine, also failed on his job. Yet, he found common language with Ukrainian officials, after Russia signed an extremely disadvantageous gas transit contract. Kozak was appointed deputy head of the presidential administration. One shall assume that the shadow cabinet will make Ukraine feel even better. How can one love a country ruled by immoral officials? Putin did not say why those people would not work in the new government. On the contrary, he thanked them for "macroeconomic stability", but said nothing about the microeconomic stability. At the same time, it is not clear why Finance Minister Anton Siluanov is still in the office, because it was him, who, together with chairwoman of the Central Bank Elvira Nabiullina, crushed the economy with a system of unaffordable crediting and money supply restrictions. Why does Denis Manturov, the Minister of Industry, keep his post as well, even though he failed the Superjet project and ruined the domestic aircraft-building industry?
Categories: Russia & CIS

Dmitry Medvedev's government resigns, Russian PM is going to change

Wed, 15/01/2020 - 16:27
Dmitry Medvedev, the Prime Minister of the Russian Federation considers that it is the right decision for the sitting government of the Russian Federation to resign against the background of Putin's proposals to amend the Constitution of Russia."These amendments, when they are adopted, they will bring significant changes not only to a number of articles of the Constitution, but to the balance of power, executive power, legislative  and judicial power," said the Prime Minister. "In this context, it is obvious that we, as the government of the Russian Federation, should provide the president of our country an opportunity to make all the necessary decisions. In these conditions, I believe that it was the right decision for the government to resign in accordance with article 117 of the Constitution of the Russian Federation."The amendments to the Constitution, which President Putin suggested during his Address to the Federal Assembly on January 15, 2020, contain the idea to delegate powers to approve the head of the government and the ministers from the President of the Russian Federation to the State Duma (the parliament).Putin instructed the outgoing government of Dmitry Medvedev to perform its duties until the new cabinet is formed.Against the background of the news about the resignation of the government, the Russian ruble declined sharply against the US dollar. The dollar is now traded at 61.725 rubles per dollar, which is 30 kopecks lower than before the government resignation news was announced.It remains unknown who is going to become Russia's next prime minister. Reportedly, Putin is going to open a new position of deputy head of the Security Council and plans to appoint Dmitry Medvedev to this post. Putin himself, as president, also serves as the chairman of the Security Council."Dmitry Anatolyevich [Medvedev] has always been engaged with these issues and, from the point of view of enhancing our defense capability and security, I consider it possible and asked him to deal with issues of this property and category in the future," Putin added, commenting on Medvedev's upcoming appointment as his deputy at the Security Council.Putin recalled that Medvedev was served as the president of the Russian Federation and chaired the government for almost 8 years. "This is probably the longest time of service in this post in recent history," he said.Putin emphasized that if Medvedev's appointment requires changes to existing laws and regulations, then this will be done in the near future.The Security Council of the Russian Federation is a constitutional body, which, in particular, prepares decisions of the head of state in issues related to the nation's development strategy, protection of the vital interests of citizens, society and the state from internal and external threats, and pursues the unified state policy in the field of national security.The chairman of the Security Council is Russian President Vladimir Putin. The Secretary of the Security Council (Nikolai Patrushev has been taking this position since 2008), permanent members of the Security Council and members of the Security Council, whom the president appoints, also act as members of this authority. Putin regularly holds operational meetings with permanent members of the Security Council.
Categories: Russia & CIS

Putin wants 7 amendments to Constitution for strong, nuclear Russia

Wed, 15/01/2020 - 13:55
On January 15, 2020, Russian President Vladimir Putin delivered his 16th Address to the Federal Assembly. During this annual speech, the head of state traditionally sets out his assessment of the state of affairs in the country and his vision of main objectives for the future. This year, Putin's speech was broadcast live almost everywhere - on the facades of buildings, in public transport, at clinics, hospitals, airports, libraries, on Mount Elbrus and even on board the International Space Station. Putin paid first priority attention to such issues as increasing the birth rate in Russia, increasing the income level of citizens, supporting young families, overcoming poverty and economic stagnation.Economists, experts and many public figures believe there will be no "revolutionary" or "breakthrough" suggestions, because they are simply no such suggestions per se. Putin started his speech with saying that there is a demand for a change in the Russian society. The pace of change should increase every year, he said, with the active participation of Russian citizens in them. At the same time, he noted, it is extremely important how many people there are in the country. Thus, the problem of demography was the first one that Vladimir Putin spoke about in this speech.The fate of Russia and its historical prospects depend on demography in the first place, the president said, added that the country needs to escape from the demographic trap and ensure the country's population growth.Putin noted that it is the generation of the 1990s that builds families today. Russia experienced a significant demographic crisis during the 1990s, which has created a complicated demographic period today.The total birth rate coefficient in 2019 was 1.5. For comparison, the coefficient was 1.4 during war years.As Putin said, the point of all measures that he proposes is to create an extensive family support system.The president emphasized that the measures in the field of demographic development that the Russian authorities had taken before have already brought positive results, and there is a large new generation growing in Russia. "They are the boys and girls who go to kindergartens and study at schools now," the president said. "It is very important that they take true family values close to their hearts: that family means love, happiness, the joy of motherhood and fatherhood, that family means strong connection of several generations, where respect for elderly people and care for children always unite, that family gives a feeling of confidence, security and reliability," Putin said.If all this becomes a natural moral norm for the younger generation, then the authorities would be able to solve the historical objective to guarantee the development of Russia as a large and successful country.About 70-80% of low-income families in Russia are families with children. "Very often, even when both parents work, the income of such a family is very modest," Putin said.If incomes are low, families should receive additional payments for their first and second children, the president said and suggested implementing monthly payments for each child from three to seven years old already from January 2020. Families whose income does not exceed one subsistence rate per person will be eligible to such payments. "When the child turns three years old, the family stops receiving payments and may find itself in a difficult situation. This is what happens most of the time, and we should not make this happen. In this regard, I propose to provide monthly payments for children aged from 3 to 7 years inclusive, starting from January 1, 2020," Putin said."At this age, children "get acquainted" with viruses, they often get sick and do not go to school. So, it is often difficult for mothers to combine work and child care," he added. Initially, such payments will amount to a half of the cost of living - 5,500 rubles, and in 2021 they will be increased twice to the average amount of 11,000 rubles per month.The program of the maternity capital in Russia will be extended before 2026, while the capital will be increased. "Presently, this program embraces the period before December 31, 2021. I know that many people wonder what the state intends to do after December 31, 2021. We will extend this program, at least before December 31, 2026," Putin said. With the birth of a second child, the maternal capital will be increased by another 150,000 rubles, and then it will be indexed every year.The total amount of the maternity capital for a family with two children will make up more than 616,000 rubles. From January 2020, families in Russia will receive maternity capital already with the birth of their first child.For young families, the preferential mortgage rate will apply to the entire loan. Vladimir Putin called on all banks - not only the state ones - to actively participate in the program of preferential mortgage at 2% for families with children.Putin proposed that all school children studying in grades from 1 to 4 should have free hot meals at their schools.
Categories: Russia & CIS

If NATO strikes Kaliningrad, Russia will seize Baltic in 48 hours

Fri, 20/09/2019 - 15:19
Russia will not wait for the United States to launch an attack on the Kaliningrad enclave. The General Staff of the Armed Forces of the Russian Federation have preventive measures not to let this happen, military expert Mikhail Alexandrov believes.US Air Force Operations Commander in Europe, General Jeffrey Harrigian, said that the United States had a plan to break through air defense of Russia's Kaliningrad enclave in Europe. According to The National Interest, a B-52 bomber of the US Air Force practiced an attack on the Kaliningrad region in March of this year. Does Russia have similar plans?Mikhail Alexandrov, a leading expert at the Center for Military-Political Studies at MGIMO, Doctor of Political Sciences, told Pravda.Ru that "Russia is not going to sit and wait for them to break though Russia's air defenses." "The General Staff of the Armed Forces of Russia do not think with such notions. One can break through air defenses only as a result of a massive attack operation. This can be done by concentrating aviation into massive fire support. "As soon as we can see the concentration of American aircraft on airfields in Europe - they cannot reach us in any other way - we will simply destroy those airfields by launching our medium-range ballistic missiles at those targets. Afterwards, our troops will go on offensive in the Baltic direction and take control of the entire Baltic territory within 48 hours. NATO won't even have time to come to its senses - they will see a very powerful military buildup on the borders with Poland. Then they will have to think whether they should continue the war. As a result, all this will end with NATO losing the Baltic States," Mikhail Alexandrov told Pravda.Ru describing one of the scenarios for a possible development of events in case of Russia's response to NATO aggression. Another variant for the breakthrough of the missile defense system in Kaliningrad provides for a massive cruise missile attack on the Russian territory. According to the expert, Russia has cruise and ballistic missiles that it can launch on the territory of the United States."If the Americans launch a missile attack on Kaliningrad, then we will strike, say, Seattle, where largest US aircraft factories are located. Having destroyed those factories we will deprive the Americans of the possibility to build their aircraft. They will no longer be able to build up their fleet of military aircraft," said Mikhail Alexandrov.Russia has efficient air defense systems to intercept cruise missiles. If it goes about a ballistic missile strike, the expert reminded that Russia has a missile defense area in Moscow that can intercept at least 100 missiles and maybe even more, since there are no restrictions associated with the ABM Treaty.
Categories: Russia & CIS

Russia waves off threat of default and financial blackmail

Tue, 10/09/2019 - 18:50
Russia has weaned off the threat of default by fully securing possible lump payments on its public debt. In doing so, Russia has also waved off the threat of political blackmail through sanctions. For the first time since 2014, Russia's net government debt has fallen below zero into the negative zone. This became possible owing to record reserves that have covered the debt of the state, RBC said. Net debt shows company's ability to pay the entire debt at the time of analysis. To do this, specialists compare the size of long-term and short-term borrowings with available highly liquid assets.In a nutshell, if Russia found itself in need to pay off its debts immediately, it would be possible to do it at the expense of government deposits at the Central Bank and commercial banks.Oleg Alexandrov, director of CEFK GROUP, told Pravda.Ru, that such an  achievement may show positive influence on Russia's international ratings. "The state can now direct more investments into economy, including for infrastructure development," Oleg Alexandrov noted. According to the expert, the changing structure of prices on hydrocarbons, Russia may switch to developing non-oil exports and the non-oil sector of economy. Russia can now enter the borrowing market for much more favorable conditions. Gazprom, for example, has placed its bonds at 1.1% per annum. Naftogaz of Ukraine - at 12% per annum. The Ukrainian company must thus pay a higher interest to compensate investors' risk. Russia's Ministry of Finance announced that it would enter the borrowing market if it could borrow at lower interest rates than existing ones - 3.4% per annum.The accumulation of public debt in developed countries and issuing countries, especially in the United States, is not seen as a dangerous phenomenon, because those countries profit from selling their currency as a commodity. In order to repay and service previous debts, new ones are issued at lower rates. In other words, new loans keep their economies afloat. For those countries that maintain complicated relationships with the United States, the accumulation of public debt is deemed dangerous. They may lose a possibility to refinance it being unable to access short-term borrowings, for example, as a result of appropriate sanctions. Russia experienced this situation in 1998 due to the crisis of the global financial system. Russia experienced default, the collapse of the national currency rate and the impoverishment of the population.As usual, there is another side to the issue of debt stability. Against the backdrop of growing state reserves, the Russian economy is showing low growth rates. In the first half of 2019, Russia's GDP grew by only 0.7% in annual terms. The Russian government is running a tight budget policy, both in terms of control over government spending and the tax burden. The budget builds up savings by withdrawing assets from the private sector.In developed countries the debt burden grows disproportionately to economic success. There is stagnation both in the USA and in Europe. The only solution to debt problems of developed countries is devaluation of reserve currencies. Such a move will lead to inflation and a decline in the welfare of the population of issuing countries. The dollar may lose its reserve currency status in the world, which will be very difficult to restore.
Categories: Russia & CIS

New Russian MC-21 passenger aircraft debuts in the sky at MAKS-2019 air show

Tue, 27/08/2019 - 15:56
Russia's state-of-the-art narrow-body passenger aircraft MC-21 took part in the flight program of the MAKS-2019 air show in the town of Zhukovsky near Moscow. The flight lasted for about five minutes, with presidents of Russia and Turkey, Vladimir Putin and Recep Tayyip Erdogan watching. Putin and Erdogan took part in the opening ceremony of the air show. It was the first time, when the new airliner demonstrated its beauty in the sky to the eyes of the general public. MAKS-2019 will demonstrate three MC-21 aircraft, one of them with interior design. The first test flight of the aircraft was held in 2017; the serial production of the MC-21 is to begin in 2021.Aeroflot will become the main operator of the new aircraft. The airline has already signed a contract for the supply of 50 of these aircraft with another contract for 35 more aircraft under development.Russia has been working on the MC-21 for more than ten years. Only one version of this mid-range narrow-body airliner is being developed - the MC-21-300 with a capacity of 211 seats in the two-class layout. The Irkut Corporation created the aircraft in cooperation with many foreign companies. In 2018, the company faced difficulties with the deliveries of composite materials because of sanctions. Large elongated composite wings reduce fuel consumption, thereby increasing the economic efficiency of the aircraft.The USA imposed sanctions on JSC Aerocomposite (part of the United Aircraft Corporation, UAC) and some other companies related to the same industry profile in the fall of 2018. Foreign suppliers (Hexcel (USA) and Toray Industries (Japan)) thus stopped selling composite raw materials to two Russian companies. As a result, Irkut Corporation had to localize the production of components and systems of the aircraft. The level of localization is expected to reach 97% by 2020, and the aircraft will not depend on foreign supplies. The total cost of the project until 2025 is estimated at 437 billion rubles. On July 22, 2019, the head of Rostec, Sergei Chemezov, asked President Vladimir Putin for another 300 billion rubles for the financial recovery of all UAC companies to implement the MC-21 project and other programs of the Russian aviation industry. The Sukhoi SuperJet 100, Airbus A350 900 and Embraer E195 are also to be demonstrated as part of the flight program of the MAKS-2019 air show. As for military aviation, one will be able to see  the fifth-generation fighter Su-57, the latest MiG-35 of 4 ++ generation, modern combat aircraft Su-35S, Su-34, the Be-200 amphibious aircraft. For the first time, naval aviation pilots of the Russian Aerospace Forces will present the program "Air combat with elements of super-maneuverability." The pilots will fly two Su-30SM fighters for the program.MAKS-2019 will also showcase the model of the Russian-Chinese wide-body long-range CR929 aircraft. Visitors will be able to see the cockpit, as well as elements of the first, business and economy class cabins.Foreign aircraft manufacturers will demonstrate in Russia the short-haul airliner Embraer E-195E2 in the Tech Lion livery, the Pilatus PC-24 business jet, and the light-engine Piper M500 aircraft. The Airbus A350-900, which was previously demonstrated at MAKS air shows, will be presented this year with new Airbus Connected Experience solutions. The solutions are designed to raise the level of passenger comfort and improve their interaction with the crew.The fifth-generation Russian fighter aircraft Sukhoi Su-57 will be presented for the first time both in the static and in the flight program. The Ilyushin Il-112VE light military transport aircraft will be another new model of military aircraft. The convertible Il-78M-90A air tanker, more than 160 modern models of military equipment and latest high-precision aviation weapons will be shown at MAKS-2019 as well.The range of products manufactured by Russian Helicopters will be widely represented too. Visitors will be able to take a look at the world's heaviest Mi-26T2V helicopter, the Mi-38T transport assault helicopter, Mi-171A2 and Mi-17V-5 medium-sized helicopters, Mi-24P and Mi-35M transport-combat helicopters, combat reconnaissance and Ka-52 Alligator assault chopper, light helicopters Ansat and Ka-226T. Ka-52K and the export version of the "Night Hunter" - Mi-28NE will be on display on the ground.Russia's Almaz-Antey aerospace defense company will showcase full-scale models of vehicles of the Tor anti-aircraft missile system and a new system for countering unmanned aerial vehicles. The company will also show the S-400 Triumph and Antei-2500 long-range systems, the Viking and Vityaz medium-range systems, and other products.
Categories: Russia & CIS