News From Russia: December 19th, 2008!

RBC, 19.12.2008, Naberezhnye Chelny 17:32:20.Russian Prime Minister Vladimir Putin has suggested that a RUB 30bn (approx. USD 1.09bn) program for renewing municipal car fleets be developed and implemented in order to support the Russian automobile industry. He made this proposal during today’s meeting on additional steps to stabilize and improve the situation in the automotive sector. Putin explained that he met with heads of regional and municipal governments on Thursday and it was agreed that 70 percent of the program would be financed from the federal budget, and the remaining 30 percent by local and regional authorities. The money will only be used to buy domestic vehicles, Putin stressed. He added that the program would allow local governments to provide the public transportation, housing, utilities, and other socially important sectors with new vehicles.

RBC, 19.12.2008, Kiev 16:59:51.The Ukrainian parliament has refused to halt arms supplies to Georgia, as a mere 195 members out of the necessary 226 in parliament voted in favor of suspending such supplies. At the same time, however, 237 deputies, including those from the Yulia Timoshenko Bloc and the Our Ukraine – People’s Self Defense faction, voted against the move. The deputies decided that such a ban would affect Ukrainian defense companies. They also urged the president and chiefs of government bodies in charge of arms trade with Georgia to observe the country’s national interests.

RBC, 19.12.2008, Moscow 16:29:05.Russian Foreign Minister Sergei Lavrov believes that Russia’s relations with the European Union and NATO “have ultimately benefited” from the Caucasus crisis, as he told a press conference today. The conflict in the Caucasus has first of all demonstrated, Lavrov said, that NATO alone cannot respond to all global threats and challenges. Secondly, the crisis has shown that the European Union, with the proper leadership, is capable of handling matters of European security. The resulting peace plan negotiated by Russian and French Presidents Dmitry Medvedev and Nicolas Sarkozy became the basis for the settlement of the crisis, Lavrov stated.

RBC, 19.12.2008, Kiev 12:09:00.Governor of the National Bank of Ukraine Vladimir Stelmakh has denied Prime Minister Yulia Timoshenko’s accusations of devaluing the hryvnia and blamed the government’s “bungling work” for bringing the country to a point where it may face an internal default as early as December 2008, the central banker was quoted by RBC Ukraine as saying on Inter TV late Thursday. Stelmakh said the PM’s announcement gave the dollar a boost, thus slashing the hryvnia’s value by one half within a mere day, as exchange rates of 14 hryvnia per dollar were already being called.

RBC, 18.12.2008, Moscow 17:41:28.According to Russia’s Deputy Economy Minister Andrei Klepach, Russia’s international reserves will contract by $110bn-140bn to just $300bn by the end of 2009. As of December 1, 2008, the reserves stood at $455.73bn, down 5.95 percent month-on-month. Meanwhile, reserve assets in foreign currency amounted to $404.563bn, with Russia’s IMF reserve position at $1.018bn, and special drawing rights (SDRs) at $1bn.

RBC, 18.12.2008, Moscow 18:45:24.According to the Economy Ministry’s forecast for Russia’s economic development, oil production will amount to 480m tonnes in 2009, Deputy Economy Minister Andrei Klepach told journalists today, adding that oil prices were expected to stand at $50 per barrel. If oil prices stay at $60 per barrel, oil production may reach 493m tonnes. Meanwhile, natural gas output is expected to total 670bn cubic meters. Russia’s oil exports are projected to amount to 235m tonnes in 2009, compared to 244.4m tonnes in 2008, while gas exports are expected to reach 203bn cubic meters in 2008 and 208bn cubic meters next year.