The British Parliament has come up with recommendations to tackle ‘dirty’ Russian money as its Foreign Affairs Committee released a report, titled ‘Moscow's Gold: Russian Corruption in the UK’ Particularly, the Parliament suggested that issuance and placement of Russian sovereign bonds through sanctioned banks be encumbered. According to the report, "dirty" Russian money is undermining Britain's efforts to stand up to the Kremlin. Authors of the report also warned that London's markets were enabling the Kremlin to spread its influence throughout the West by allowing its citizens to buy and sell luxury properties in the British capital.
First Deputy Chairman of the Russian Federation Council’s (upper house) International Affairs Committee Vladimir Dzhabarov assumes that the British side "is applying double standards" in this situation. "I am surprised by the British MPs’ stance. Russia has repeatedly said that many fugitives who stole money here are hiding in the UK. We have even asked to expel them. Nevertheless, the British accepted that money with great pleasure, while the Russians bought visas, residence permits and invested in the British economy," the Russian MP told RBC. He also urged British authorities to strip Russian citizens of their money that have been put into the British economy. "People can lose their net worth, but I do not care. I think that all the money should be working in the country," Dzhabarov noted.
"Any sanctions have negative implications, though [they] may vary in scale," First Deputy Chairman of the Federation Council Budget and Financial Markets Committee Nikolay Zhuravlev told the paper.
"State bonds are currently issued mainly through state-owned banks, which are facing sectoral sanctions. The so-called SDN-sanctions that envision much tougher restrictions on transactions do not apply to them. If they are banned from issuing sovereign bonds, this function may go to others, particularly private credit organizations. Many banks offer this service," he explained, adding that "a total ban on purchase of state bonds will also hurt local investors, since the share of foreign buyers of (Russian) state debt is enormous."
An Open Skies Consultative Commission session that will be held on Tuesday in Vienna will focus on the certification of Russia’s new Tu-214ON recon aircraft, Head of the Permanent Mission of the Czech Republic to the OSCE and current Chairman of the Commission Vladimir Galuska told Kommersant. The meeting’s participants plan to consider "standard issues" of the Treaty on Open Skies, and discuss "the process of certifying Russian aircraft," he said. The issue is about the Tu-214ON developed on the basis of the Tu-214 passenger aircraft for observation flights within the Treaty, the newspaper says. This follows Russia’s request for permission to use digital equipment within its survey flights first among all other 34 member-states of the Open Skies Treaty.
The Treaty signed in 1992 and enacted in 2002, enables the participants, among them Russia and the US, to fly through the airspace of its members to monitor military activities and enhance mutual understanding and confidence. Most members view the accord as one of the most efficient cooperation mechanisms in the area of arms control in the Euro-Atlantic region. However, certain US lawmakers are reluctant to allocate funds for the country’s participants in the Treaty, under the assumption that Russia breached the treaty, Kommersant writes. Certain figures have even been calling on Washington to withdraw from it.
Experts warn that the Open Skies Treaty may suffer due to the current Russian-US discord. James Acton, the co-director of the Nuclear Policy Program at the Carnegie Endowment of International Peace, is confident that the agreement still meets the interests of the US and its allies. "I am disappointed at the attempts by the Chamber of Representatives to block the allocation of funds for new aircraft. This will only play into the hands of those who baselessly state that Russia benefits more from the Open Skies Treaty than the US," he said. "Meanwhile, I hope that Russia will be able to ease reasonable concerns by the US side," the expert said, adding that "both sides should exercise efforts to maintain the treaty."
Tatyana Moskalkova, Russia’s Human Rights Ombudsperson, has called for considering her personal visit to meet certain Russian citizens incarcerated in the United States while diplomatic staff is being cut back. In an interview with Izvestia daily, she stressed that she had repeatedly turned to various international bodies over the infringement of Russians’ civil rights abroad. "I have approached [international agencies] regarding Russians being prevented from casting votes in Ukraine, and regarding athletes being banned from displaying the national flag at the Olympic Games. Meanwhile, I received replies from Secretary General of the Council of Europe Thorbjorn Jagland and United Nations Secretary-General Antonio Guterres that my requests will be taken up for review. Nevertheless, I have not seen any substantial changes on this matter," Moskalkova noted. "Each time, I keep my hopes up in light of the 70th anniversary of the adoption of the Universal Declaration of Human Rights that those institutions will start working as they were initially meant to," she added.
According to the ombudsman, she is particularly concerned about those Russian citizens who have been abducted by US intelligence services over the past several years on the territory of third countries or extradited bypassing international legislation. "It is very important to bring up the issue of Russian detainees in the United States. For example, the issue of Roman Seleznev sentenced to 27 years in prison over hacking attacks. Reports about severe confinement conditions for Russians in US prisons are coming from various parties. In this situation, it is necessary to establish a constructive dialogue with the US, though unfortunately there is no ombudsman post there. Moreover, amid changing the format of our consulate it is necessary to consider visiting Russian citizens in the US," she explained.
Currently, over 30 Russian citizens are incarcerated in US prisons, with most of them having pled not guilty. The most recent case was the extradition of Russian citizen Yevgeny Nikulin from the Czech Republic to the US. He was detained in Prague on October 5, 2016 at the request of a California court on suspicion of hacking targets in the United States. "When seeking the arrests of Russian citizens in third countries, the US often puts enormous political pressure on law enforcement and judicial bodies as they mostly can’t be bothered to inform the Russian authorities about the charges being pressed against Russians, and do not notify our consulates about the facts of a detention," Izvestia writes with reference to Russia’s foreign ministry.
The 2018 FIFA World Cup in Russia will boost the country’s economic growth by 1-2 percentage points in June and July, and by 0.3-0.4 percentage points in annual terms, Izvestia writes with reference to experts in major financial institutions and banks. They expect a sharp rise in retail trade in the period between June 14 and July 15. With an influx of 1.5 mln sports fans from other countries expected, they may spend a total of $2.3 bln, or 141 bln rubles, experts said.
Russia selected 11 host cities to be the venues for the matches of the 2018 World Cup and they are Moscow, St. Petersburg, Sochi, Kazan, Saransk, Kaliningrad, Volgograd, Rostov-on-Don, Nizhny Novgorod, Yekaterinburg and Samara.
The matches of the 2018 World Cup will be held between June 14 and July 15 at 12 stadiums located in the 11 above-mentioned cities across Russia. Two of the stadiums are located in the Russian capital.
Meanwhile, the World Cup may slightly accelerate inflation in Russia, Deputy Director of the Center for Development Institute of the Higher School of Economics Valery Mironov told the paper. He suggests that the sports event will push consumer prices up by 0.2-0.3 percentage points, meaning that annual inflation will amount to at least 2.5% during this period. Football fans coming to Russia will almost increase demand for the national currency, Izvestia says, adding that in June and July the dollar might weaken by 0.5-1 rubles.
The Moscow Exchange has launched repurchase agreement operations with the shares of the US' ten most liquid securities - Apple, Facebook, Amazon, Tesla, Google, Nike, Microsoft, NVIDIA, Twitter and McDonald's - in rubles and dollars. Experts interviewed by RBC business daily said that this would enable Russian owners of those securities to receive liquidity swiftly. Previously, Russian investors had to use the services of intermediaries - subsidiaries of foreign banks and foreign subsidiaries of Russian brokers. This move is considered to be the Moscow Exchange’s first step towards its goal of offering clients access to global stock markets.
Raiffeisen Bank Analyst Denis Poryvai notes a huge demand for US securities among Russian investors. He suggested that many trade participants in Russia who hold shares of those companies on their balance sheet, need liquidity, which has prompted the Moscow Exchange to launch this repo instrument. Aton’s Mikhail Ganelin says that the current climate for trading US securities is rather challenging since one needs a separate dollar-denominated account for it, and not every broker allows US stock trades. He also expects extra fees for this new option from the Moscow Exchange.
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