Moscow press review for January 16, 2014
MOSCOW. Jan 16 (Interfax) - The following is a digest of Moscow newspapers published on January 16. Interfax does not accept liability for information in these stories.
POLITICS & ECONOMICS
Russian economic growth will not exceed 2.5% in the next two years, and perhaps longer, despite anticipated global growth of 3.5%, Economic Development Minister Alexei Ulyukayev said Wednesday. Prime Minister Dmitry Medvedev said Russia has fallen into the middle-income trap, while a senior Central Bank official said Russia is facing stagflation (Vedomosti, p. 1; Kommersant, p. 3).
Russia and Iran are holding negotiations to ramp up economic cooperation, including a goods for oil deal that would turn Russia into the biggest importer of Iranian crude. Moscow intends to continue talks on this subject, despite U.S. concerns that this could negatively impact negotiations on the Iranian nuclear problem. Both issues will be discussed during Thursday's visit to Moscow by Iran's foreign minister and an upcoming visit to Iran by President Vladimir Putin (Kommersant, p. 1).
Russia's Federal Tax Service wants to make private individuals responsible for paying property tax even if they do not receive tax notices. Individuals would be required to declare any apartments, vehicles and land they own or face fines and penalties. The Tax Service hopes to put the new rules in place by 2015 (Kommersant, p. 1).
Criticism of Russia's pension reforms has cost Mikhail Dmitriyev his post as president of the Center for Strategic Research, the think tank that advised the government and predicted the mass protests of the winter of 2011-2012. Dmitriyev was one of the authors of the 2002 pension reforms that introduced the funded portion of pensions (Vedomosti, p. 2).
Russian Finance Minister Anton Siluanov believes the only way to balance the country's pension system is to raise the retirement age, and he proposed Wednesday to discuss this issue. The Kremlin, however, opposes the idea (Vedomosti, p. 4).
Interview: Moldovan Prime Minister Iurie Leanca (Vedomosti, p. 8).
OIL & GAS
Rosneft has received up to $20 billion from China's CNPC as prepayment for oil supplies. The Russian state oil major has not disclosed what the money will be spent on. One analyst believes Rosneft will use a quarter of the amount to pay down debt (Vedomosti, p. 10).
Despite a steep reduction of prices for Russian gas, Ukraine is still negotiating for reverse shipments from Slovakia. Reverse gas supplies will clearly be more expensive for Ukraine than Russian gas, but Kyiv hopes the possibility of imports from Slovakia will be an argument in quarterly price confirmation talks with Russia's Gazprom (Kommersant, p. 9).
BANKING, FINANCE & INSURANCE
Sberbank reported net profit up 13.4% to a record 392.6 billion rubles in 2013, including 42.1 billion rubles in December, when it saw the highest influx of retail deposits in four years. Analysts expect Russia's largest lender returned its share of the deposit market to at least where it was at the start of 2013 (Kommersant, p. 8; Vedomosti, p. 14).
The cooling of Russia's consumer lending market has forced one of its biggest players, Home Credit and Finance Bank, to cut about 10% of its staff of approximately 31,000. The bank intends to cut costs by billions of rubles, as its profit tumbled 22.5% year-on-year in the first nine months of 2013 (Vedomosti, p. 11).
REAL ESTATE & CONSTRUCTION
The Qatar Investment Authority is in talks to buy the Pokrovsky Hills residential development in Moscow from Whitehall, the real estate fund managed by Goldman Sachs. The townhouse development could be worth $380 million-$400 million (Vedomosti, p. 11).
TELECOMMUNICATIONS, MEDIA & TECHNOLOGY
The shares of leading Russian instant payments system Qiwi tumbled nearly 20% Wednesday after a package of anti-terrorism legislation, including proposed restrictions on electronic payments, was submitted to the State Duma, spooking investors. The bill would restrict the use of e-wallets (Vedomosti, p. 1; Kommersant, p. 7).
TRANSPORTATION
Due to the economic slowdown, the Russian government has decided to indefinitely postpone one of its most expensive infrastructure projects - the construction of the Moscow-Kazan high-speed rail line at a cost of more than 1 trillion rubles. Russian Railways will try to change the prime minister's mind with a new financial model in which part of the money would be raised through concessions (Kommersant, p. 1).
Billionaire Suleyman Kerimov, who lost his unofficial status as key investor in Dagestan to the Summa Group in 2013, has managed to regain some of his position in the southern Russian republic. His Nafta Moskva will get the right to modernize the airport and port of Makhachkala, reportedly with the direct blessing of the Kremlin. At the port, he will have to share zones of influence with Summa (Kommersant, p. 7).
AUTOMOTIVE & ENGINEERING
Sales of cars and light commercial vehicles in Russia fell 5.5% to 2.78 million in 2013, though there was a 4% increase in December, partly due to the end of the subsidized car loan program. Market players believe sales forecasts for 2014 are exaggerated by an average of 10% (Kommersant, p. 1; Vedomosti, p. 10).
