Moscow press review for July 12, 2012
MOSCOW. July 12 (Interfax) - The following is a digest of Moscow newspapers published on July 12. Interfax does not accept liability for information in these stories.
POLITICS & ECONOMICS
Moving federal government agencies out of central Moscow to the new area being annexed by the capital is quite realistic and would not require budget funding, and the new administrative center could be built in the village of Kommunarka, outside the Moscow Ring Road, according to a report Prime Minister Dmitry Medvedev has submitted to President Vladimir Putin (Kommersant, p. 1).
A subsidiary of Vnesheconombank (VEB), OJSC Far East and Baikal Region Development Fund, plans to propose that the government return to the idea of setting up a special development institution for the Far East. This would involve a special law for investment in projects in the region, and the use of the National Welfare Fund, the Investment Fund and pension savings to finance them (Kommersant, p. 1).
Banker Vladimir Kogan, once Russia's wealthiest federal government official, is returning to the government. He will become head of the Federal Construction, Housing and Communal Services Agency, as well as deputy minister for regional development (Vedomosti, p. 1).
The former principal owner of juice and dairy company Wimm-Bill-Dann, David Yakobashvili has joined the ranks of the largest payers of personal income in Russian history. He said he paid 2.29 billion rubles in income tax for 2011. The money will go to Kalmykia, where Yakobashvili registered in November 2011 (Vedomosti, p. 1).
The elimination of customs barriers between Russia, Kazakhstan and Belarus has given a boost to trade within the Customs Union, while dealing a blow to China, the EBRD reported. The trade turnover between Russia, Kazakhstan and Belarus jumped 6% in 2010-2011 and grew another 18% year-on-year in the first quarter of 2012 (Vedomosti, p. 3).
OIL & GAS
Russian oil company Bashneft plans to acquire assets primarily abroad, and could carry out an initial public offering in 2013, the company's new chairman, Felix Yevtushenkov, son of the principal owner of Bashneft parent AFK Sistema, said (Vedomosti, p. 8).
In a rare development on the oil company, prices for Russia's Urals crude have not only risen to nearly $100 per barrel, but also overtaken prices for North Sea Brent. The embargo on Iranian oil imports to Europe will support higher prices for Russian oil (Kommersant, p. 8).
UTILITIES
There are plans to centralize payments on Russia's retail electricity market, totalling 2 trillion rubles, at authorized banks, including the Russian Regional Development Bank, which is owned by state oil company Rosneft. However, RRDB's CEO, Grigory Kurtser, a co-author of the reform, might leave the bank before it is implemented (Vedomosti, p. 7).
BANKING, FINANCE & INSURANCE
Gazprom's placement of $1 billion in 10-year Eurobonds and EUR750 million in five-year Eurobonds at 4.95% and 3.75% respectively on Wednesday demonstrated the huge demand for Russian bonds. However, not all companies will be able to take advantage of it (Vedomosti, p. 1).
European regulators are demanding that banks be recapitalized, and leading Russian lender Sberbank will have to comply. Shareholders of Slovenia's Banka Volksbank, a unit of the Volskbank Internation group which Sberbank acquired in February, have decided to increase the bank's capital by EUR18.3 million (Vedomosti, p. 7).
RETAIL & CONSUMER MARKET
The footwear business of the former owner of Russian consumer electronics retailer Eldorado, Igor Yakovlev is growing by leaps and bounds. He has opened 80 Kari stores in Russia, Poland, Ukraine and Kazakhstan in the past six weeks, and the chain could more than triple in size by the end of the year (Vedomosti, p. 7).
TELECOMMUNICATIONS, MEDIA & TECHNOLOGY
Mobile phone service provider Megafon, a general partner of the Sochi Olympics and the Russian team at the upcoming Summer Olympics in London, has accused rival MTS of "parasitic marketing." The company is unhappy over an MTS TV commercial featuring wrestler Khasan Baroyev, and has complained to the president of the Sochi-2014 Organizing Committee (Kommersant, p. 1).
AUTOMOTIVE & ENGINEERING
Russian state engineering company Uralvagonzavod (UVZ) and Canada's Bombardier plan to sign an agreement Thursday to form a joint venture to build trams and subway cars. Analysts reckon the venture could win a substantial share of the tram market, but will have a much harder time winning subway car contracts due to competition from Russia's TMH (Kommersant, p. 9).