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Provokatsiya: Regime may be preparing stitch-up job on OSCE.

Posted by democratist on March 5, 2012

5th March 2012,

The OSCE has done a thorough, balanced, and above all clearly evidence-based job in its observation of the 2012 Russian Presidential elections. However, despite their efforts at presenting their findings in diplomatic language, by telling the truth about the significant manipulation which has clearly taken place in these elections, they risk unsettling the regime to the point that some excuse will have to be found to discredit them, and ensure that they are not present for any future Russian polls.

In a press statement given this afternoon international observers noted that, “Although candidates in yesterday’s presidential election in the Russian Federation were able to campaign unhindered, conditions were clearly skewed in favour of one of the contestants, current Prime Minister Vladimir Putin.”

Furthermore, observers made it clear that, there had been problems (often serious) during the counting process at around a third of the polling stations they had visited.

That manipulation of the process was left until the count is hardly surprising. Much was made by the regime of the cameras which had been placed in almost all 94,000 polling stations, enabling the public to observe the vote over the internet, and supposedly deter fraud.

However, it now seems clear that the “workaround” employed by the authorities to surmount this obstacle to the desired result (exaggerated in favour of Putin, probably by about 7-10%) was to reserve the bulk of their manipulation until after the completion of voting. From what the international observers have said, it appears that, once the cameras were safely off (or at the very least since they lacked the resolution to observe the count in any detail), it was “business as usual.”

But in making public their findings, and because the OSCE ODIHR is respected for its professionalism and therefore influential both in the West and among the intelligentsiya within Russia, it seems very likely that the organization now risks a serious counter-reaction from the regime. Given the nature of the current government, and the (so far unpublicized) scrutiny the OSCE have been under from the FSB since they started working in Russia last year, this will probably manifest itself through a tried and tested KGB ploy; the provotatsiya (“Provocation,” “set up” or “stitch-up”).

It is telling that Vladimir Churov, head of the Central Electoral Commision (ex-KGB, and famous for having declared that Putin is “never wrong”) today accused “some” (so far nameless) international observer organizations of espionage: Apparently, Russia is a country where the head of the electoral administration feels that it falls within his remit to make such comments – although quite how remains unclear.

But, given the controversy that the OSCE’s statement is likely to stir up – with opposition demonstration planned both for today and the coming weeks – it will be interesting to see to what extent Churov’s allegations will be picked up by the leadership and what (if any) contrived “evidence” the FSB will have cooked up to prove the observer’s perfidy.

It should be remembered that the OSCE ODIHR were effectively banned from observing the Russian elections in 2007/08 (after their severe criticism of the 2004 polls). This time around, it seems quite possible that they will be kicked out permanently, with all the fanfare that a paranoid espiocracy like Putin’s Russia can muster.

Stay tuned…

Posted in CIS Media, OSCE | Tagged: | 1 Comment »

Ukraine Under Yanukovich.

Posted by democratist on May 14, 2011

May 14th 2011,

Over recent weeks, Democratist’s attention has started to shift towards Ukraine. Here are some of our initial thoughts on the current domestic situation;

The two key trends that have dominated Ukrainian politics in the period since Viktor Yanukovich became president last February have been a marked expansion of authoritarianism, and an increase in high-level corruption. As Anders Aslund recently commented in the Kiev Post, reforms introduced as part of a $15 billion IMF loan arrangement have not boosted Ukraine’s competitiveness or market freedom, but have instead benefitted a few businessmen close to the President. Officially the economy appears to be bouncing back from the global financial crisis, with growth projected at 4.5% this year and 6.5% for 2012, but this does not yet appear to be filtering down to the popular level. While the opposition leadership remains weak and unpopular (a result of Orange-era bickering and stagnation), social tension and resentment of the government is increasing, and a number of protests are planned in Kiev over the coming days.

Last year saw a return to the 1996 constitution, which has in turn meant a far greater concentration of power in the Presidency than had been the case under the constitution agreed in 2004 (and followed by former President Yushenko). The Rada has become a compromised and unpopular rubber stamp, with parliamentarians regularly and illegally voting for others who have not bothered to turn up to work, or passing laws at the first reading – sometimes apparently without knowing what they contain. Some MPs switched sides shortly after Yanukovich came to power (perhaps as a result of financial or other inducements) and are therefore very unlikely to be re-elected. There were also a number of credible allegations of electoral fraud in relation to last October’s local elections from the respected non-partisan OPORA NGO, and Freedom House downgraded Ukraine from “Free” to “Partly Free” in its annual Freedom in the World Index for 2011. It currently seems unlikely that Parliamentary elections set for next September will pass smoothly, considering the increasing unpopularity of the current government, even in its Eastern strongholds.

The media (TV and most papers) are owned by oligarchs with close connections to the President, and have very quickly fallen into self-censorship. The IMI Press Freedom NGO reported a drastic decline of freedom of expression in Ukraine last year. Only a couple of smaller independent titles remain, such as Dzerkalo Tyzhnya and Ukrainska Pravda (both owned by the journalists who write for them). Pressure has also been applied to the English-language press, including the Kiev Post, although both the Post and Ukrainian Week magazine are still independent, and both critical of the government.

The judiciary has also become a tool of the regime; the high court and prosecutors office have come under Presidential control, and last year saw a number of selective and politicised criminal cases launched against at least eight Tymoshenko allies, including former interior Minister Yuriy Lutsenko (arrested on 26th December, and still in jail). Meanwhile only one, very junior cabinet minister from the current government, plus a couple of PoR officials, have been charged with corruption. The SBU (Security Service) was reported to have been attempting to place pressure on Ukrainian Catholic University rector Borys Gudziak in May 2010. It’s role since that time remains unclear.

In terms of corruption, while independent Ukraine has always been corrupt (part of the Soviet inheritance) quite a few of the current ministers appear to be trying to steal as much as possible, in as short a time as possible – and regardless of the damage they might be inflicting on the wider economy, to Ukraine’s international reputation, or even whether they are discovered (indicative of how tightly the media and judiciary are controlled by the government, and of a lack of desire to control this problem at the highest level). Ukraine has been slammed on this count by both Transparency International and the World bank.  A well placed source has suggested to Democratist that up to 30% of the state budget is siphoned off by various scams.

Perhaps the most instructive case in this regard relates to the grain export quotas that were set after an apparently disastrous harvest last summer (in fact only 13% down on 2009). In August 2010, Deputy PM Andrei Klyuev announced that state control of the grain market needed to be strengthened and a previously unknown company called Khilb Investbud was appointed as the state trading agent in the grain market with exclusive rights to effect all operations connected with grain on behalf of the state. Then in October the government decided to introduce grain export quotas, and who should get a big chunk of the much-prized licenses required in order to export Ukrainian grain, other than the very same Khlib Investbud. It later transpired that, while 49% of Khlib Investbud belonged to the Ukrainian state, the other 51% belongs to a company called Kolossar. Kolossar is partly owned by a man called Mykola Prysazhniuk, who just happens to be…the Minister of Agriculture (and an old friend of President Yanukovich). The other major owner of Kolossar is Russian bank Vneshekonombank. No action has been taken against  Prysazhniuk, and there are no plans to withdraw the quota system, despite the fact that Ukraine is a member of the WTO, and grain quotas restrict an important source of export earnings and tax revenue.

A similar degree of murk surrounds the privatization of the national telecommunications company UkrTelecom which, after having large sums of public money invested into it over the past decade, was sold for a minimal $1.3 billion in an auction in which only one firm, a mysterious Austrian private equity firm called EPIC, was permitted to bid, thereby excluding competitors including Deutsche Telekom. UkrTelekom is currently the only company to have a 3G license, and looks set to have a monopoly on 4G services as well.

A similar story is apparent from the introduction of a series of new tax laws passed by the Rada. These seem to have been specifically designed to favour large corporations at the expense of Small and Medium sized Enterprises (SMEs), and allow greater scope for corruption: Tax inspectors are now allowed to raid businesses as often as they want (previously this was a maximum of once per year), and they are able to seize property for up to 96 hours without a court order. One result of this is that FDI into Ukraine (once money reentering the country from Cyprus is discounted) remains negligible. More significantly, there’s a growing sense of anger among SMEs that may well soon spill over into protest.

In terms of the broader  economy, it currently looks unlikely that Ukraine will convince the IMF to part with the two remaining $1.6 billion loan tranches to be decided in July because of  lack of action on pension reform, VAT and gas prices. However, cash from the UkrTelecom sale was received by the treasury in April, and along with an unexpectedly strong trade balance, and the planned privatization of 700 state-owned companies over the coming year (due to bring in about $1.2 billion), fears that Ukraine will default on its $42.1 billion of short-term public debt due for repayment, refinancing or restructuring in over the summer have waned slightly, although they remain considerable.

Nonetheless, Ukraine is now suffering from a number of serious economic problems including soaring prices (especially food and fuel), a weak credit market, wage arrears and  unemployment. As a result, according to an article in 12th May Russian Nezavisimaya Gazeta, in a recent survey some 45% of respondents said that they might be willing to participate in antigovernment protests. While we feel that this figure may be exaggerated, a number of protests are planned in the coming days in Kiev, and the level of participation in these will give a better indication of the level of popular anger.

Posted in CIS Media, Democratization, Freedom of the Press, Ukraine, Ukrainian Corruption, Ukrainian Politics | 3 Comments »

Going Postal: Press Freedom Under Fire In Kiev.

Posted by democratist on April 16, 2011

April 16th 2011,

Democratist has got wind of an emerging scandal in Kiev, which may provide some additional clues as to the current state of the country’s business and media environments, as well Ukraine’s ongoing struggle with high-level corruption.

Staff at the English language Kyiv Post went on strike yesterday following owner Mohammad Zahoor’s decision to fire editor Brian Bonner over publication of a rather tense interview with agriculture Minister Mykola Prysyazhnyuk which centered on the question of allegations of corruption in relation to Ukraine’s multi-billion dollar grain export business, and the possible involvement of Party of the Regions (PoR) lawmaker Yuriy Ivanyushchenko with a company that has received some rather favourable treatment in this regard. The staff are calling for Bonner’s reinstatement.

According to a note on the Post’s Facebook page, the dispute began on Friday morning, when after the paper had been sent for printing, Zahoor called Bonner to say that the Post would be shut down if it published the interview. After considering this request, Bonner refused and said he would not participate in the censorship of the paper.

Prysyazhnyuk gave the interview on 11th April, but subsequently had cause to reconsider his position, and apparently asked Zahoor to block publication.

Media freedom in Ukraine has come under increased pressure since last February, when Viktor Yanukovich (who famously lost the repeated second round of elections in 2004 after the “Orange Revolution”) was elected to the presidency. Human Rights Watch states that 2010 also saw increased pressure and attacks on human rights activists and in other areas.

Zahoor is probably the richest foreigner in Ukraine, with a net worth estimated at anywhere between $500 million and $1 billion. He made his money in the Donetsk steel business over the last two decades, after having initially studied in Ukraine as a metallurgy student in the 1970’s.

He is now chairman and owner of the ISTIL Group which, after selling up in 2008, went on an asset-buying spree, including the purchase of various properties in Kiev, and the Post in 2009 for a reported $1.1 million.

Revealing, Mr. Zahoor has already had somewhat strained dealings with the Ukrainian political class; after having given a speech praising President Leonid Kravchuk during the  1994 presidential campaign, he apparently came under pressure for several years when Kravchuk’s rival, Leonid Kuchma, came to power.


Posted in CIS Media, Ukraine | 4 Comments »

Egypt: US versus Russian foreign policy.

Posted by democratist on February 4, 2011

4th February 2010,

Over the past week or so Democratist has once again been bemused by how faithfully and obviously Russia Today provides an almost direct representation of Russian government policy on any given issue, at any given time, despite it’s stated claim to editorial independence and posturing as left-wing “alternative” to the mainstream media, especially in the US. While RFE/RL or CNN may sometimes reveal a pro-American bias (and Fox News remains as dreadful as ever), nothing beats the “straight from the Ministry of Information” feel of so much of RT’s reporting. 

A week after the clearly one-sided use of Wikileaks reports to argue that the revolution in Egypt was being directed by the CIA, RT’s latest position alternates between yet another barrage of faux outrage at the shortcomings of American Empire (what right does the US have to interfere in Egyptian affairs, after having supported Mubarak for so long?) combined with an undercurrent which reveals the Russian MFA’s true intentions; an eye to profiting from the West’s potential alienation from autocratic regimes in the region (one of RT’s correspondents today commented that Obama’s calls for a rapid transition of power in Egypt was a message “to friends and foes alike, when the going gets tough, don’t call on us”).

In this regard, Democratist has found RT’s recent interviews with journalists and anti-American peace campaigners critical of US financial support and weapons sales to Egypt rather unconvincing, given that since 1991, the Russians have, just like the Americans (but without the United States’ enduring relationship with the regime, or its deep pockets) been happy to “do business” with Mubarak, and agreed to sell the Egyptians a nuclear energy package worth $2 billion back in 2008, in addition to selling weapons to Syria and Iran.

From our perspective, it would be fairer to point out that, while both the US and USSR/Russia engaged in realpolitik and interference in the internal affairs of third countries in the Middle East and elsewhere during the Cold War, and have both continued to do so to differing extents subsequently (e.g. in Ukraine and Georgia in the Russian case, Afghanistan, Iraq and elsewhere for the US), the Russians have remained wedded to an unswervingly nationalist and realist outlook (attempting to topple regimes they didn’t like or bolster those they did, happy to deal with anyone as long as it supports their national interests), whereas the United States has, in addition to its morally questionable but strategically driven realist maneuvering, also consistently defined a separate liberal, democratizing ethical role for itself, including in the middle East.

Has the US been hypocritical? Certainly this is true to an extent; the US may be more likely to play up human rights abuses by opponents than allies (Iran or Syria versus Saudi Arabia or Turkey). In the case of Iraq, the neo-conservative interpretation of liberal interventionism (“freedom at the barrel of a gun”) has resulted in disaster. And in the current Egyptian case, it seems likely that State Department officials are working with elements of the old regime to make sure that things don’t change too quickly (whilst probably also seeking to bring together oppositionists to help govern the country in the interim before an election).

Nonetheless, as the Wikileaks cables  (which RT did so much to publicise last week) demonstrate, the US has also worked behind the scenes to gradually foster democratization in autocratic allies such as Egypt. This is because as Michael McFaul has observed, it recognizes the long-term security advantages that stem from enduring alliances with other democratic countries that similar agreements with autocrats cannot provide. These include sustainability (how long the relationship lasts), consistency (the threat of internal instability), and cost. The latter two problems are apparent in the Egyptian case.

However, in relation to Russia’s own foreign policy, realpolitik continues to dominate almost completely. Apart from their willingness to sell regional autocrats both weaponry and reactors, the Russian attitude towards democracy and human rights can be gauged by (taking an example closer to home) their actions during last December’s elections in Belarus, before which they provided media and financial backing to the opposition, only to cut a deal with Lukashenko at the last-minute, and then have President Medvedev describe it as an “internal matter,” when 600 people (including 7 of the 9 opposition candidates) were arrested for protesting the subsequent widespread electoral fraud.

Posted in CIS Media, Egyptian Revolution, Revolutions, Russia Propaganda, Russian Foreign Policy | 1 Comment »