Weekly 7 December 2019

Jetting into trouble

Hello! This week our top story is on revelations about how Russia’s political elite uses private jets and why this caused a spat between opposition leader Alexei Navalny and major media outlets. We also tell the tale of a pro-Kremlin youth movement leader who emigrated to Germany; have a round-up of several giant, newly-completed infrastructure projects; summarise an investigation into Moscow State University’s long-serving rector; and looks at a series of lenient sentencing decisions for opposition protesters.

Private jets for Medvedev’s wife, the patriarch and Kostin’s girlfriend

The scandal of the week centered on two investigations by opposition leader and anti-corruption activist Alexei Navalny into private jets owned by state-owned VTB, Russia’s second largest bank. Navalny detailed Monday how the expensive private planes were used by both the girlfriend of VTB head Andrei Kostin and the wife of Prime Minister Dmitry Medvedev. The Bell discovered that yet another private jet linked to VTB was used by Patriarch Kirill, the head of the Russian Orthodox Church. Those accused of misconduct in have not commented publicly, but the revelations did spark yet another conflict between Alexey Navalny and Russia’s leading media outlets.

The investigations

  • With the help of data from flight trackers and geolocation tags on Instagram, Navalny identified two luxury jets worth $50-60 million each that were used by Kostin’s girlfriend, television journalist Nailya Asker-Zade, and Svetlana Medvedeva, the wife of Medvedev. Both planes used to be owned by VTB, but in 2017 and 2018 were sold to an offshore company whose ownership structure is unclear.

Bombardier Global 6000

  • The official salaries of Kostin and Medvedev would not be enough to rent, let alone buy, a private jet, according to Navalny. And he suggested that the jets were being paid for with money from VTB, which has over $2 billion in annual net profits but also receives state subsidies (no less than $15 billion over the past decade).
  • The Bell found another private jet, a Gulfstream G450, which is owned by the same offshore company. Photographs showed that Patriarch Kirill has flown on the jet at least once, and other flights taken by the plane coincide with trips taken by Kremlin officials. The head of the Russian Orthodox Church almost always travels on private jets, but normally he is loaned them free-of-charge by private businessmen.
  • Previous investigations have alleged that luxury real estate properties are owned by the Medvedev family and Kostin’s girlfriend.
  • Friday night VTB made first comment after the scandal. The bank said it sold the jets in 2017 due to sacntions-related concerns, and had never been operating the aircraft whatsoever. Simultaneously. Medvedev’s press secretary was interviewed by a loyal website Lenta.ru. He denied all allegations and called Navalny’s investigation a provocation.

The controversy

  • Three leading media outlets — Vedomosti, RBC and Kommersant — did not report on Navalny’s investigation into Kostin and Asker-Zade. In keeping with tradition, this led Navalny to accuse (Rus) the publications of cowardice, while journalists from Vedomosti, also in keeping with tradition, retorted (Rus) that the investigation had failed to expose any new information and accused Navalny of poor fact-checking procedures. The disagreement quickly turned personal, and insults continued (Rus) for two days, absorbing much of the Facebook media community.
  • Navalny has a long-standing conflict with the media. Last year, we wrote about another similar dispute. Ironically, the essence of the dispute is almost the same as the one that President Donald Trump has with the U.S. media: Navalny, who has a much larger audience than most media outlets, looks down on journalists, believing their role is to distribute information. Navalny himself does a lot of journalistic work in his investigations, but remains a politician and isn’t bound by any professional journalism standards.
  • Completely ignoring Navalny’s investigations is also a strange decision. His data implies corruption within a major state bank and is an important revelation in its own right. Moreover, the fact that Navalny — Russia’s most popular opposition politician — chose to publicize this case is another reason it should be covered by the media.

Why the world should care

Few people doubt that the Russian elite is deeply corrupt, and there is traditionally no reaction from the authorities to Navalny’s investigations. But that does not mean they have no effect: if the DASKA Act designed by U.S. Senators Bob Menendez and Lindsey Graham passes, the U.S. will have to decide which Russian banks to hit with sanctions. VTB would be a very likely candidate.

Three major infrastructure projects launched in 10 days

What do a natural gas pipeline, a bridge and a highway have in common? Russia has announced the completion of each one of them in the last 10 days. While these projects are the result of years-old investment, infrastructure is a growing priority for the Kremlin, which sees it as a way to boost economic growth. The newly-finished projects are:

  • Power of Siberia Pipeline: this 1,800-mile-long pipeline carrying natural gas from Siberia to China was opened Monday as Putin and his Chinese counterpart, Xi Jinping, looked on via video link. Flows through the pipeline are scheduled to rise to 38 billion cubic meters by 2025 — making China Russia’s second largest customer for natural gas after Germany and earning $400 for Russia’s coffers over 30 years. But it also has geopolitical significance: it’s major physical evidence of Moscow’s much-vaunted ‘pivot to the east’ following the deterioration in relations with the West caused by the 2014 crisis in Ukraine.
  • Moscow-St. Petersburg Highway: after 8 years of building work, the 415-mile M11 toll highway between Moscow and St. Petersburg, Putin’s hometown, was opened by the Russian leader on November 27. In some sections as wide as 10 lanes, the road means drivers can avoid notorious bottlenecks on the existing highway, and will cost each vehicle about 2,000 rubles ($31) to use.
  • Amur Bridge: the completion of the first highway bridge between Russia and China was announced November 29. Discussions about a road link between Russia’s Far Eastern city of Blagoveshchensk and its Chinese counterpart across the Amur River, Heihe, have been underway since Soviet times. The 0.7-mile-long bridge, another example of Moscow-Beijing cooperation, is scheduled to open to traffic next year.

The giant infrastructure projects that tend to get approved in Russia are the ones with major political significance — one only has to remember the bridge connecting mainland Russia with Crimea, annexed by Moscow in 2014, that opened in May. Projects that have been recently abandoned, or severely delayed, include a rail bridge to the island of Sakhalin in the Far East and a high-speed rail link between Moscow and Kazan. Last month, Kommersant newspaper reported (Rus) that Putin had approved the construction of a bridge across Siberia’s Lena River to the city of Yakutsk, which had been under discussion since the 1980s.

Why the world should care

Russia is investing huge amounts on infrastructure. A total of $172.3 billion has been earmarked for infrastructure (mostly roads) through 2024 as part of Putin’s National Projects development plan, while much of the $15.7 billion likely to be freed up from Russia’s rainy-day oil fund from 2020 is also set to be channelled toward new infrastructure.

The Kremlin cheerleader who left politics and emigrated to Germany

Without Navalny’s investigation, this week’s biggest story would have been the news that former Duma deputy Robert Shlegel had emigrated to Germany. In the 2000s, Shlegel was one of the founders of the pro-Kremlin movement Nashi, a group used by the authorities to fight against what it saw as the possibility of revolution fomented from abroad.

  • In 2005, the then 21-year-old journalist Shlegel became Nashi’s press secretary and then, in 2007, he became the youngest deputy from the ruling United Russia party in the State Duma. In parliament, he authored a law punishing journalists for slander, and was the initiator of internet regulation legislation. He also voted in favor of a law banning foreigners from adopting Russian orphans. However, in 2016, Shlegel did not run for reelection, and this week it emerged that he has moved to Germany to take a job at IT company Acronis, founded by businessman Sergey Belousov.
  • In an interview, Shlelgel said he became disillusioned with politics, and moved abroad because to preserve the German culture in his family (the former deputy is a descendant of German settlers who moved to Russia in the 18th century).
  • Nashi was one of the Kremlin’s most important political projects of the mid-2000s. Its ideological leader was the Kremlin ‘puppet master’, Vladislav Surkov. The movement’s raison d’etre was to fight against youthful opposition protests, and stop a possible Orange Revolution, like that which took place in Ukraine in 2004. The movement attracted students from the Russian regions who, in exchange for loyalty, received free trips to Moscow, small financial handouts, and an opportunity to forge a career. In some of their most notorious stunts, Nashi activists destroyed (Rus) books written by modern authors, publicly stamped (Rus) on portraits of human rights activists, and hired women to seduce opposition politicians and offer them cocaine while they were being filmed on hidden cameras.
  • But during the opposition protests at the end of 2011 and early 2012, it became clear that Nashi was not prepared to take to the streets to counter demonstrators. After that, Surkov lost his job and the group’s financing was cut.
  • Nashi’s leaders had very illustrative subsequent careers. The group’s leader, Vasily Yakemenko, was briefly minister for youth affairs and then tried to open a chain of vegetarian cafes. Another Duma deputy who was closely involved in Nashi, Maksim Mischenko, went on to work as a regional official and in 2017 was sent to prison for theft. Another of the movement’s key figures, Maria Drokova, emigrated to the U.S. where she now works as a PR specialist for a tech company — she was also the subject of a documentary film, Putin’s Kiss.

Why the world should care

The story of Shelgel and other Nashi leaders is a useful demonstration of the dynamics of Russian political life. The main conclusion to draw is that total cynicism and a complete lack of principles reign supreme. Politicians produced by this system will change their views the moment the political winds change.

IN BRIEF

Mixed severity sentences for Moscow protesters

Seven sentencing decisions Friday for protestors arrested after opposition rallies in Moscow this summer largely confounded expectations of long jail terms. Student and blogger Yegor Zhukov, 21, charged with extremism, received 3 years’ probation; Pavel Novikov, a 32-year-old dentist accused of throwing a plastic bottle at police, was fined 120,000 rubles; Alexander Mylnikov and Vladimir Yemelyanov, accused of violence against law enforcement, both received 2 years of probation. Three others, all convicted of attacking law enforcement officers, received jail terms: Nikita Chirtsov, 22, was given a 1-year prison sentence; Maksim Martyntsov received 2 and a half years; while Yegor Lesnykh was given 3 years. All seven men, who maintained their innocence, were at the center of a public campaign for their release that was backed by prominent cultural figures including popular rapper Oxxxymiron. Zhukov’s eloquence in court meant he became a symbol of this summer’s short-lived protest movement and his closing statement this week was widely shared online. The punishments were less severe than those requested by prosecutors, who sought between 3 and 4 years behind bars for each. The outcomes add to a growing list of cases, beginning with journalist Ivan Golunov who was arrested in June on false drug charges, where surprisingly lenient court decisions have followed vocal public campaigns.

Rector for life?

Moscow State University is perhaps Russia’s most famous university, but its ageing rector, Viktor Sadovnichy, has recently come under intense scrutiny. In his post for 27 years, Sadovnichy was re-appointed Thursday after a special law exempting him from the age restrictions on public office (Sadovnichy recently turned 80) was signed by Putin. In a recent investigation (Rus) into Sadovnichy, Vedomosti newspaper, looked at his influence on the country’s most prestigious educational establishment, which has seen a 40 percent rise in student numbers since 1992 and the number of departments grow from 16 to 42. Today, Moscow State University controls assets worth 250 billion rubles and has a budget of 30 billion rubles a year, of which 55 percent comes from the state. Sadovnichy, who supervised the thesis supervisor of Putin’s reported daughter, Katerina Tikhonova, has championed university projects including a huge new library and a giant scientific research center. While Moscow State University tops Russian university rankings, in international rankings it rarely makes the top-50, and in the Times Higher Education table it is outside the top-150.

Peter Mironenko, Howard Amos