Ukrainian President Pyotr Poroshenko had a long-awaited meeting with his American counterpart Donald Trump right after the US Department of Treasury added 38 more organizations and individuals to the sanction list on Tuesday.
Among the blacklisted Russian nationals are Deputy Minister of Economic Development Sergey Nazarov, Member of Russia’s Federation Council (upper house) and Russian Presidential Envoy for Relations with Organizations of Compatriots Abroad Alexander Babakov and his two aides, Alexander Vorobyov and Mikhail Plisyuk. This new round of anti-Russia sanctions, and in fact the first one imposed by the Trump administration, will affect bilateral relations between US and Russia, though the gravity of the damage will depend on Moscow’s response, Former US Ambassador to Ukraine and Senior Fellow at the Brookings Institution Steven Pifer told RBC.
"Apart from Moscow, sanctions have several targets, since they were announced for the purpose of signifying support to Ukraine prior to the Trump-Poroshenko meeting, as well as to ensure congressmen that the administration will stick to a tough line on sanctions and that it is not required to pass new related laws," he said.
Director General of the Russian International Affairs Council Andrey Kortunov believes the US Treasury Department’s decision is part of the domestic power struggle between the Trump administration and Congress. “Widening the scope of the sanctions may be interpreted as a preventive measure in any subsequent dispute with Congress, considering the fact that the bill requires a wider set of sanctions and is aimed at creating a theoretically new legal base to maintain the sanctions regime (against Russia) and transfer the authority of defining the status from the executive to the legislative branch,” he told RBC. However, Kortunov says, it is yet too early to speak about any deterioration in the relationship between the US and Russia, adding that “any conclusions may only be drawn after the personal meeting of Trump and Putin.”
Meanwhile, a source close to Poroshenko’s administration told Kommersant business daily that Ukrainian president has attempted to keep the role of one of Kiev’s sponsors for the United States as he did his best to "get Trump’s team interested in a settlement of Ukraine’s southeast financially." "Since Trump is a businessman we adopt a business approach," he told the newspaper. The essence of our proposals is that American firms will gain 90% of all contracts once repair efforts to damaged infrastructure in Donbass get underway. In order to do this, it is crucial to return Donbass to Ukraine’s control, which is not going to happen without Washington’s involvement and additional pressure on Moscow from the Trump administration,” he added.
However, top-level sources in Russian diplomatic circles told Izvestia daily that Washington does not consider Kiev a reliable partner, nor does it plan to prop up Kiev, as was the case under the previous administration. "Moscow expects Washington to appoint a partner for Vladislav Surkov to hash over Ukraine. On the whole, the United States has not yet adopted a position on Ukraine, though (it is) aware of the fact that one cannot trust Poroshenko," the source said, adding that the White House occupant considers Ukraine a 'trump card' that will help it bargain certain concessions from Moscow in other more important regions the US is interested in.
Kyrgyz President Almazbek Atambayev’s visit to Russia and meeting with his Russian counterpart Vladimir Putin, the fifth one this year, took place in the months-long run-up to the Central Asian country’s presidential elections scheduled for October.
Research Fellow at the Center for Central Asia and Caucasus Studies of the Institute of Oriental Studies of the Russian Academy of Sciences, Stanislav Pritchin, speaking with RBC, said the visit should be viewed in the context of the country’s upcoming election, even though Atambayev won’t be running for the presidency. What is essential for the President of Kyrgyzstan is to demonstrate positive results and stability during his tenure as chief of state, which is hardly possible without Russia, he said, adding that a successful visit to Moscow is necessary to ensure support for his Social Democratic party and its candidate Prime Minister Sooronbay Jeenbekov, who is running in the presidential race.
In what is considered to be the key agreement between Russia and Kyrgyzstan, president signed a protocol on an intergovernmental agreement to settle Kyrgyzstan’s debts to Russia for loans previously granted back in 2012 on Tuesday. “There has been a request from the Kyrgyz party to write off (debts), and we reached out to our partners and signed an agreement on settling its $240-mln debt,” Russia’s Finance Minister Anton Siluanov revealed to RBC, adding that it is now up to the State Duma (lower house of parliament) to approve the deal.
The heads of state also signed an agreement on fostering military-technical cooperation, which was nine documents inked during their Tuesday meeting. They also confirmed the common understanding that the presence of Russia’s military base in Kyrgyzstan plays a key role in providing stability and security in the Central Asia. The base’s period of stay in the country was extended for 49 years in 2009, the newspaper writes.
Terrorist organization symbols, especially those of the Islamic State (IS, outlawed in Russia), are on the chopping block to be labelled as extremist and get banned. Furthermore, media sources could be obligated to state in reports that such organizations are outlawed, according to the recent initiative by the parliament of Russia’s Dagestan, RBC says. Furthermore, media sources could be obligated to state in reports that such terror organizations are outlawed, according to a recent initiative by the regional Dagestani parliament, RBC says. According to Head of Dagestan’s government administration Tamara Chinennaya, plans are in store to submit respective amendments to the federal laws entitled “On tackling extremists’ activities” and “On the media” to the State Duma in September.
A source in the National Antiterrorist Committee, which has already considered the document, told RBC it has issued a positive response on it. Currently, Russian media sources are only recommended to mention a terrorist organization being outlawed in the country. Chinennaya said the amendments are related to loopholes in Russia’s anti-extremist legislation, which have been used by the media, particularly those "sympathizing with the Islamic State." A source in the Federal Security Service (FSB) said it was Dagestan that submitted amendments as the regional authorities are close to the security chiefs. "It won’t be necessary to invest anything in order to detain the same Crimean Tatars with their symbols, and any person wearing an IS T-shirt may be arrested," he noted.
The Federal Tax Service has laid out clarifications on VAT payments for electronic services provided in the Russian Federation, Izvestia writes. According to the document obtained by the publication, if an overseas firm purchases electronic services from another foreign company in Russia, it is not required to pay the tax. Experts interviewed by Izvestia point out this has made it possible for foreign internet services to evade the so-called ‘Google tax’ that came into force this year, which stipulates that foreign companies engaged in online sales of electronic content in Russia must pay a VAT of 15.25%.
"Some time ago, foreign companies used to cooperate with Russian firms and register its subsidiary in the country in order to sell its goods and service on the territory of Russia, but in the digital era, foreign companies are able to offer their services directly to customers," Director of Project Activities at the Institute for the Development of Internet Arseny Shcheltsyn told the newspaper, adding that "the Google tax settled the tax issue."
According to the expert, the clarification will exempt companies from double tax payments if they resell their services, however, is they acquire services for themselves, the Russian budget will be short of tax payments.
Russia’s Federal Anti-Monopoly Service (FAS) has uncovered at least five illegal schemes used by foreign companies in Russia to control fishing vessels and fish they harvest here, FAS deputy head Andrei Tsyganov said in an interview with Rossiyskaya Gazeta. The most simple ones use agreements to grant the use of foreign fishing boats to Russian companies for a certain period time, virtually giving their direct owners the right to harvest the country’s marine biological resources without acquiring a stake in the Russian company, he said. Sometime, Russian fishing firms get hooked on direct financial dependence from foreign creditors if they make a loan agreement to maintain and develop activities, the official said. The source added though that the problems related to illegal control of assets by foreigners in the fishing industry are no longer as widespread as they were a few years ago, and the regulator is aware of all schemes to establish control.
When asked whether this problem is crucial for other strategic sectors of the Russian economy, Tsyganov said that other industries are more civilized. “These are mainly transnational corporations who value their reputation and minimize risks, which is why violations are isolated events,” he said. Turning to the energy sector, the official said, “If Chinese companies are the main consumers of Russian energy sources in the oil and gas sector, they clearly may be allowed to participate in the management of Russian companies involved in production and transportation of oil and gas,” adding that he considers it to be “quite a logical and reasonable way to attract foreign investors.”
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