Putin aide upbeat on 2003 Russian budget, criticizes energy sector reform
CEP20021225000073 Moscow Ekho Moskvy Radio in Russian 1207 GMT 25 Dec 02
The Russian federal budget for 2003 is much better than those for the last years, Russian presidential economic adviser Andrey Illarionov told Ekho Moskvy radio speaking live on the air on 25 December.
Speaking to radio's editor-in-chief Aleksey Venediktov, Illarionov mooted a lot on economic problems facing Russia stating his well-known point of view on the issue. He urged an emergency fund to be set while oil prices are still high in order to resolve the problems. In the passing, he slammed the Russian government for an overoptimistic approach to the world oil prices in its estimates and named BP, among other oil majors, as making their forecasts on the basis of the price of 16-17 dollars per barrel.
It will take some 25 years for Russia to reach the level of the economic development of Portugal if the country does not accelerate its current economic growth, Illarionov said. He gave an example of Kazakhstan, Ukraine and Lithuania, where the rates of economic growth are higher than that in Russia.
Speaking about the foreign economic investment to Russia, Illarionov said that it went down 10 per cent in 2002 against the last year. This is a symptom of deteriorating tax situation in Russia, he said. However, the main problem is to reduce the state expenditure, he added.
Illarionov said that Russian natural monopolies should be reformed and this is a must. Pointing a finger at his main adversary, power grid boss Anatoliy Chubays, he said that the Unified Energy System of Russia's (UES) other expenses budget line went up 1.5bn dollars this year and this is taxpayers' money. Electricity tariffs are growing quicker than fuel oil prices, and the public has the right to ask why is it so, he added. Illarionov slammed the proposed energy sector reform as pursued by the UES.
No further processing is planned.
[Description of Source: Moscow Ekho Moskvy Radio in Russian -- influential and independent radio station known for its fast breaking news coverage and interviews of politicians]
CEP20021223000074 Moscow Interfax in Russian 0813 GMT 23 Dec 02
[FBIS Translated Text]
Moscow, 23 December: The council of the State Duma at its sitting today decided to reschedule the discussion of the package of laws on the electric power industry reform to the spring session, Aleksandr Zhukov, chairman of the Duma's Budget Committee, told journalists after the sitting had ended.
The discussion of the package has been postponed by a month and will take place in the Duma in January next year, he said.
[Description of Source: Moscow Interfax in Russian -- non-government information agency known for its aggressive reporting, extensive economic coverage, and good coverage of Russia's regions]
Special Interests Accused of Delaying Russian Electric Power Reforms
CEP20021218000315 Moscow Kommersant in Russian 18 Dec 02 P 14
Russia: Chubays Says YeES' Reform Plan Has No 'Unresolved Issues' CEP20021211000325 Moscow ITAR-TASS English 1628 GMT 11 Dec 02
[Report by Alena Kornysheva: "The Duma Has Congratulated RAO YeS Rossii"]
[FBIS Translated Text]
Postponing the Review of the Energy-Reform Package
Yesterday in the Radisson-Slavyanskaya Hotel RAO [Russian Joint-Stock Company] YeES [Unified Energy System] Rossii marked the energy holding company's tenth anniversary with the conference "RAO YeES -- An Open Company." Even the Duma celebrated the event yesterday, but in its own way: a review of the package on energy reform will not take place on 18 December. The deputies will name 23 December as the new date.
RAO YeES head Anatoliy Chubays immediately admitted that "RAO YeES is still not liked by all in Russia, but in any case, there is no longer anyone indifferent to power engineering problems in Russia." With these words he turned the podium over to the chairman of the RAO YeES board of directors and, as Mr. Chubays expressed it, "jointly" to the head of the President's administration, Aleksandr Voloshin. Mr. Voloshin praised the holding company for its year-to-year growing openness and economic success (elimination of barter and nonpayments, and also stably supplying the country with light and heat), after which he expressed sympathy regarding the intractableness of the Duma, which postponed the date for the second reading of the electric-power draft laws. "Not only the state, as the main stockholder, is interested in the reform of RAO YeES, but all of the public. Therefore, for us the quality of reform is no less important than its speed, although delaying the passage of laws does not at all mean the cancellation of reform."
But the science head of the Higher School of Economics, Yevgeniy Yasin, apparently did not know this. He spoke in favor of the speediest passage of the package, thanks to which RAO YeES should become "a locomotive on the leading edge of market reform in Russia." In his opinion, electric-power reform should pull along with it the long awaited liberalization of the natural-gas market, reform of ZhKKh [housing and municipal services], and other transformations. The vice-speaker of the Federation Council, Aleksandr Torshin, also believes it essential to speed through the energy package. And the deputy head of the Duma group "Peoples' Deputy," Anatoliy Aksakov, assured Mr. Chubays that "everything will be normal."
Then a break was called, during which it was discovered that the Duma council had already made its own decision. Deputy Minister of Economic Development and Trade Andrey Sharonov was the first to respond to this news. "We still have hopes that the deputies will review the draft laws in the their second reading on 24-25 December," he said. As a reason for the postponement, the deputies formally pointed out that several of them had received the latest edition of the laws literally days before and wanted to analyze them more thoroughly. Mr. Sharonov noted that the most severe critic of the draft laws, the OVR [Fatherland-All Russia] faction, was satisfied with the amendments. Commenting on Mr. Voloshin's statements, the deputy minister noted, "If we put quality and the time period of reform on the same level, then quality, of course, is preferential; however, in the given case the quality of energy reform could suffer from dragging out the period as well as could the trust of investors in the authorities and their commitment to conducting reform."
Naturally, Mr. Chubays also could not ignore another postponement of the date. "Work on draft laws in the Duma has already taken eight months, and it always proceeded with difficulty, but the laws will be passed; the course of history is irreversible," the head of RAO YeES said with pathos. He added that nowhere and at no time have such reforms gone smoothly, because "the creation of a transparent market for electric power unavoidably eliminates privileges and the administrative resource." In the conference lobby yesterday, even the names of those whose interests obstruct the passage of the energy laws were mentioned: Mr. Deripaska and Mr. Abramovich. Kommersant's source suggested that they are intentionally putting off the period of reform in order to continue to use cheap energy at a preferential price. Therefore, the theory is not to be excluded according to which putting off the reading until spring will automatically put off RAO YeES reform for several years, since it is simply senseless to count on the deputies passing unpopular reforms in an election year. Other conjecture was also heard yesterday: dragging out the reform will lower the market value of RAO shares (they fell almost seven percent in the last two days), which the aluminum people will not fail to use because it is generally recognized that they are buying up the energy holding company's shares.
[Description of Source: Moscow Kommersant in Russian -- Informative daily newspaper purchased by Boris Berezovskiy in 1999 and often reflecting his viewpoint.].