MOSCOW, October 27 (RIA Novosti)

Novye Izvestia


Yesterday's meeting of the premiers of the Shanghai Cooperation Organization (SCO - Russia, China, Kazakhstan, Kyrgyzstan, Uzbekistan and Tajikistan) created a ballyhoo. Firstly, the Christian Science Monitor wrote it was an attempt to create an eastern counterweight to NATO. And then Russian President Vladimir Putin said openly that the SCO had exceeded the boundaries of its "proclaimed tasks" in their nearly five years of work.

Konstantin Kosachev, chairman of the State Duma's international affairs committee, said that the U.S. newspaper was acting "on the classical logic of many American analysts, who think that everything that happens in the world without the U.S. is spearheaded against it."

Professor Yuri Galenovich, chief researcher at the Institute of the Far East (Russian Academy of Sciences), said the SCO was in no way involved in confrontation with NATO. The main reason behind America's nervous reaction to its summit is a demonstration of Moscow's and Beijing's desire to increase mutual trust.

A vivid example of this was the first Russo-Chinese military exercise held in August 2005. It is no wonder that Beijing is speaking about "spiritual understanding," which traditionally begins with military partnership. The first such experience in bilateral relations dates back to the early 1950s, when two Chinese marshals attended Soviet exercises that involved the use of nuclear and chemical weapons.

On the other hand, the SCO may become a "hotline" for the exchange of security information. As for the potential military union of Russia and China, it is common knowledge that the Chinese never form military alliances.

Washington's concern was spurred by the Central Asian tour of Secretary of State Condoleezza Rice, which showed that the U.S., contrary to its expectations, cannot seriously influence the situation in the former Soviet states.

Nervousness is not the way to attain positive results. It is much more important for Russia and China to smooth over the remaining problems in bilateral relations, Galenovich said.



A new version of a bill limiting foreign investors' access to strategic industries has been prepared by the Russian Industry and Energy Ministry. It has classified as "strategic" as many as 40 sectors. The bill has many opponents, so it will not be endorsed by November 1, as President Putin demanded.

Most probably, it will not be submitted to the parliament until the first quarter of 2006, a source in the government said.

The first bill worked out by the Ministry envisaged a permissive principle of coordinating transactions. A foreign investor willing to acquire a stake of over 25% or 50% in a strategic enterprise was supposed to apply for special permission. Then the application was to be submitted to a government commission, and the Cabinet was to have the last say.

Now restrictions have been applied to 40 activities, including development and production of encryption devices, construction and exploitation of nuclear units, production of space and aircraft equipment, and natural monopolies. The three-stage procedure of considering applications has been preserved, but the final decision will be made by the Prime Minister.

Deputy Economic Development Minister Andrei Sharonov believes that the list of restricted industries should be shortened as much as national security interests allow. He does not rule out that the list of companies will be fixed by law. This will drastically reduce the possibilities of officials trying to personally gain from it.

Arkady Dvorkovich, head of the Russian President's expert department, proposed to control transactions in some cases by their activities and in others by mineral deposits fields or by lists of companies. The lists of fields and companies should be adopted by a presidential decree.

Alexei Shulunov, president of the defense enterprises' league, prefers the Industry and Energy Ministry's approach. "The activities of an individual enterprise that needs investment cannot be squeezed in some percentage norms (of non-residents' participation in authorized capital)," he argues.



General Motors has wanted to hire the relatively inexpensive and highly skilled Russian specialists for a long time. This will become possible now that its new engineering research center has opened in Moscow.

The new center will develop advanced structural materials, catalytic converters and streamline hydrogen technologies.

"The Russian auto industry's R&D institutes possess tremendous human resources," says Alexei Yazykov, an analyst at the Aton investment company. But thousands of sectoral experts are now out of work. This was a major factor in GM's decision: Russia is a corporate scientific Mecca. Yazykov predicts that other foreign companies may follow the GM example.

"GM wants to turn Russian automobile science into a full-fledged business," market watchers say. "This trend was pre-determined by the growing automobile market and the government's sectoral policies," ASM-Holding analysts say.

"The Cabinet has finally charted a sectoral development strategy. Moscow raised customs duties on used cars in early 2005. Foreign car manufacturers received different incentives. These measures have facilitated domestic market competition and forced Russian factories to reduce costs," ASM-Holding people note.

It is hardly surprising that Russian intellectual property has now become more expensive. And a sectoral R&D operator was bound to appear sooner or later.

"Tremendous opportunities have opened up before R&D institutes and science and technical centers. Russia still has to master up-to-date technologies; at the moment, no Russian manufacturer can turn out top-quality accessories for GM. The new engineering research center will probably begin by eliminating production defects," Yefim Dobrinsky from the Russian Academy of Quality Problems believes.

Vremya Novostei


During the year 81% of employers paid bribes. The average size of a bribe has risen from $10,000 in 2001 to $135,000 now, and the "corruption" market skyrocketed from $33 billion to $316 billion, more than half of the GDP, Georgy Satarov, head of the Indem Foundation, told a round table, organized by the law committee of the European Business Association in Russia, yesterday.

Such vast sums circulating in the shadow sector, said Satarov, are an indication that the Russian economy is undervalued.

Corruption cannot be controlled without changing legislation, believes Yevgeny Voyevodin, a representative of the law firm CMS Cameron McKenna. "The Criminal Code is long on mitigating circumstances of crimes and short on aggravating," he explains.

"The ingenuity of bribe-taking officials knows no boundaries," says Dmitry Larionov, chief expert of the International Road Union (IRU). More often than not bribe-taking is a streamlined process, he says. An example is mandatory cargo escorting by customs. A Cabinet edict does provide for the escort of goods valued more than $50,000 by customs officers at rates fixed by the government. In practice, however, customs officials usually say they have only two officers on duty, and they cannot escort shipments. They suggest that clients should use a commercial firm whose rates are 5 to 10 times higher.

"For all practical purposes only one agency- the Union of Customs Veterans - renders such commercial services," says Larionov. "It is not a straight bribe, but a thinly veiled method of taking your money."

"The problem is that everyone sees it, but society is still strongly corruption-minded," Satarov said as he wound up the discussion.



Russian President Vladimir Putin's electorate in recent years has become much younger, polls show.

As many as 74% of respondents below the age of 23 assess the President's work as "good" and 54% would be ready to vote for him, according to the Public Opinion Foundation. While Putin's average rating is 55%, he is supported by 60% of young people, showed a survey of the All-Russian Public Opinion Research Center, VTsIOM.

The reason is that people who are starting their adult lives now are much more satisfied with it, than older generations, explains the foundation's analyst Grigory Kertman.

Young people are pragmatic, rational and selfish in the positive sense, so they prefer simple political constructions, suggests one of VTsIOM's heads, Vladimir Petukhov. This is why they are so attracted to the idea Putin proposes, of building a Russia where you would not be ashamed to live and where you could make a career.

"Young people really support Putin more than other age groups," agrees Yuri Levada, head of an analytical center. "They believe he is energetic and progressive and do not see any alternative to him."

Youth are inclined to strive after ideals, and they understand well those of Russian traditions proposed by Putin, especially the idea of protecting the country's independence, says Mikhail Rogozhnikov, deputy director of the Institute of Social Projects.

There have been changes in the list of regions that support or disapprove of the President most. The Public Opinion Foundation's survey of over 35,000 people has shown that the biggest growth of affinity to Putin, from 11% to 22%, has been in the Kemerovo region, the Altai Territory, the Novosibirsk and Omsk regions (two years ago these regions were considered anti-Putin) and in Mordovia.

Regions including Murmansk, Tomsk, Volgograd, Leningrad and Voronezh regions registered the biggest decrease, where the President's electorate has gone down to 10-18%.

The more active the political life of a region, the more supporters Putin has there, concludes Kertman.

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