MOSCOW, May 23 (RIA Novosti) Nazarbayev president for life/Producers should process their output/Danone may take over its Russian rival
Nezavisimaya Gazeta
Nazarbayev president for life
Kazakhstan's President Nursultan Nazarbayev has approved constitutional amendments allowing him to become Kazakhstan's president for life, while his successors will only be able to hold the post for two five-year terms. This is real evidence of his personality cult.
Nobody can say if this is good or bad, and Kazakhs will only be able to discuss the issue once the president is dead. It is a fact, though, that personality cults are often denounced once they are dead.
Economic and institutional reforms in Kazakhstan are gaining momentum, and new management practices and corporate values have been introduced. Political stability is promoting a predictable investment climate and inflow of private funds.
The West has suppressed its doubts over the Nazarbayev clan and toned down criticism of its political system. U.S. Ambassador to Kazakhstan John Ordway said the constitutional amendments gave a positive impression of the reforms, which merely confirms that Nazarbayev's personality cult is not a problem for Washington.
Russia and Kazakhstan's other regional neighbors, as well as the Organization for Security and Cooperation in Europe, which Kazakhstan may join this autumn, do not consider it a problem either.
But liberals find the situation where an individual has exclusive rights and powers unacceptable, as if society recognizes that it will never be able to find a comparably wise and fair leader, who does not abuse his powers. Why struggle to carry out reforms if Kazakhstan already has the best leader imaginable and will never have a similar one in the future?
On the other hand, the amendments may stipulate the deadline for society's transition from socialism to capitalism as the essence of the model Nazarbayev has offered to Kazakhstan and the rest of the world. His republic will move into democracy and the freedom of speech without the assistance of the opposition or critics.
Nazarbayev is the president of a transition country that will become fully democratic when he goes. This is what Kazakhstan's lawmakers, the United States, Russia, and Europe believe.
As for those who do not believe this, they talk too quietly to be heard.
Gazeta
Producers should process their output
Russia's Natural Resources Ministry is working on a new procedure for distributing major deposits among users.
"We will encourage producers to build processing facilities to export not just raw materials, but products made from them," Minister Yury Trutnev told journalists Tuesday.
Relevant amendments to the legislation should be ready by the end of the year.
The minister said the right to develop major deposits in Russia would be distributed at tenders, not auctions, with the spotlight on users' plans to build processing assets and to increase recovery. The initiative will concern mainly the oil, gas, and steel sectors.
Major Russian oil and gas producers sensed the government's intention to spotlight downstream operations some time ago, and steelmakers say developing major deposits without building processing plants is unprofitable.
Vagit Alekperov, head of Russia's largest private oil company LUKoil, said at a meeting of top Russian businessmen with President Vladimir Putin that oil produced in Russia should be refined in Russia or at facilities abroad owned by Russian companies.
Industry and Energy Minister Viktor Khristenko said Russia's largest oil refinery would be built several kilometers from the Kozmino Bay at the end of the East Siberia-Pacific Ocean pipeline.
Another major refinery with a capacity of 10 million metric tons will be built in Sakhalin for about $3 billion. If Trutnev's initiative is approved, the companies developing the Sakhalin deposits will have to provide the funds. The developer of the Kovykta gas condensate deposit in the Irkutsk Region (East Siberia) will have to assume a similar obligation.
According to the press office of metals giant Norilsk Nickel, the company would not survive without refining.
Yelena Kovaleva, the company's spokesperson, said: "I cannot recall a single major project where we have not built or planned to build major processing plants."
Trutnev's speech was probably deliberately vague in order to safeguard the Udokan project.
"In my opinion, the development of, say, the Udokan copper deposit [in the Chita Region] would look strange without the construction of a processing plant," he said.
Norilsk Nickel, which is one of the main bidders for the deposit's development license, shares the minister's view.
The Udokan reserves should be evaluated by 2009, and a tender for the development license could be held the same year. Potential bidders could start saving funds for their downstream operations there.
Kommersant
Danone may take over its Russian rival
French Groupe Danone, a major world producer of dairy and other products, which holds a stake in Wimm-Bill-Dann Foods [NYSE:WBD], Russia's leading manufacturer of healthy food products, has announced its intention to manage its main rival on the Russian market.
It was reported yesterday that Danone had nominated Jacques Vincent, Danone's vice chairman and chief operating officer, to the WBD board of directors.
This increased WBD's value by less than 2%, as investors do not believe speculation that the Russian company will be part of a takeover.
Danone is the second largest beneficiary of WBD (13.7% of shares), while WBD founder Gavrill Yushvayev holds 19.45%, board chairman David Iakobachvili 10.12%, and member of the board Sergei Plastilin 8.58%.
WBD has scheduled its annual shareholder meeting for June 27.
WBD's main shareholders and market analysts have no doubt that a Danone representative will sit on the WBD board of directors.
Anton Saraikin, the official spokesman of WBD, said: "The stake held by Danone is sufficient to appoint a representative to the WBD board."
Danone's Paris office confirmed it has the right to do so.
Analysts are at a loss over Danone's decision to take the step now.
Igor Kovanov, a managing partner of Falcon Advisers, a leading banking investment company, said: "Direct rivals usually try to get a seat on the board immediately prior to takeover, and the move often points to a strategic alliance between the two companies. However, there have been several exceptions on the Russian market. For example, the board of directors of X5 Retail has a representative from [French retailer] Carrefour, but they have not set up a joint venture yet."
Viktoria Grankina, an analyst with the Troika Dialog brokerage, said: "Carrefour is only gaining a foothold in Russia, whereas Danone and WBD are tough rivals on the yoghurt market."
Alexei Semyonov, a managing partner of East Capital, which has been working in the stock sector and rendering brokerage and asset trust management services since 2001, explained Danone's decision by the increase of its stake in WBD, adding that WBD founders could withdraw from the business.
WBD shares grew by 1.63%, to $77.82, on the New York Stock Exchange yesterday. Andrei Nikitin, an analyst with the Uralsib financial corporation, said the reaction was feeble because "the market has grown tired of rumors about WBD's possible sale."
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