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Press review: Kiev hatches plot to subvert Donbass talks and EU ties with Balkans in peril

Top stories in the Russian press on Friday, May 8

Kommersant: Ukraine plotting to replace negotiators at Trilateral Contact Group

Kiev has decided to include ten Donbass internally displaced persons (IDPs) in the Trilateral Contact Group for ironing out the crisis in eastern Ukraine. They are expected to replace the current negotiators from the self-proclaimed Donetsk and Lugansk People’s Republics at the peace talks. Moscow and the unrecognized Donbass republics warn that in the end Kiev would hold talks only with itself, Kommersant business daily writes.

The representatives of Kiev, the DPR and LPR as well as the Organization for Security and Co-operation in Europe and Russia have been parties to the Contact Group’s talks since 2014. However, on May 4, the Ukrainian President’s Chief of Staff Andrei Yermak said that Ukraine would expand its delegation and bolster its status and would not hold contacts with the current Donbass representatives, namely the DPR and LPR top diplomats, Natalya Nikonorova and Vladislav Deinego. Instead, Kiev seeks to select ten Donbass IDPs to join the talks, the Novoye Vremya newspaper reported, citing its sources in Vladimir Zelensky’s office. The idea is to fill this group of Donbass representatives with individuals such as lawyers, journalists, businessmen, clergy and others, the source told the paper.

The unrecognized republics have lambasted Kiev’s plans to include alternative Donbass representatives in the group. LPR Foreign Minister Vladislav Deinego has branded this as Kiev’s scheme to replace the negotiators with "convenient persons."

A Russian government source familiar with the talks with Ukraine believes that Kiev’s decision would "simply destroy the Contact Group." "This will end in a situation where they will negotiate there only with each other, and without us and the Donbass representatives," he warned.

However, Kiev’s plans to boost its delegation with ten new negotiators cannot be stopped, according to a source from the Russian delegation at the talks. The Trilateral Contact Group lacks such a regulation and therefore the delegations could include as many members as they like. Moscow earlier suggested drafting and adopting a special regulation of the Contact Group, but this proposal was not supported, he noted.


Izvestia: EU’s relations with Western Balkans hit a deadlock

The European Union has pledged to draw up a comprehensive investment plan for the Western Balkans by this fall. The Zagreb Declaration discussed at the May 6 video conference says that the EU’s support for the Balkans is larger than that of other partners. Brussels apparently sought to demonstrate its discontent over the growing influence of Russia and China in the region. Although Europe allocated some 3.3 bln euro to the Western Balkans to combat COVID-19, Russia and China had offered their helping hand earlier. Experts interviewed by Izvestia say that the EU’s sway in the region is slipping, therefore the prospect of joining the alliance for some countries after Brexit and the pandemic has become vague.

According to Head of the Center for Modern Balkan Crisis Studies at the Russian Academy of Sciences Elena Guskova, the Balkans is the region where the conflicting interests of Europe, Russia and the United States clashed and the struggle for influence in the region has been carrying on for many years. "The Balkan games" with the EU have been ongoing since Serbia chose to join Europe. However, the EU has repeatedly set such conditions as to end trade relations with Russia and recognize Kosovo’s independence, she noted. "Serbia constantly made concessions but every time the date of joining the EU was put off and 2025 when [its membership] is being promised is too far away and now Belgrade could change its mind," the expert said.

Executive Director of the Progressive Politics Foundation Oleg Bondarenko told the paper that the coronavirus crisis has exposed the EU’s problems. Instead of providing support and solidarity, the EU shut down even the internal borders. "The EU has lost its influence in the region because the prospect of expanding it has become vague, especially after Brexit and the pandemic," Stevan Gajic, a researcher at the Institute of European Studies in Belgrade, told the paper.

The Western partners’ criticism against Serbia is a reaction to its friendly ties with Russia and growing cooperation between Moscow and Belgrade. "Russia has always provided assistance to Serbia, without demanding anything in return, and that’s why this country has not imposed any sanctions against Russia, so therefore it has friction with the EU," Guskova noted.


Vedomosti: Russia’s IT business facing huge losses

In the second quarter of 2020, Russia’s IT sector could become unprofitable, Vedomosti writes, citing a letter by the Ministry of Digital Development, Communications and Mass Media sent to the government and the Ministry of Economic Development. The net profits of companies working in the IT sector in April-June could plunge to zero and the payments of interest rates on loans and other expenses could result in losses, officials warn.

According to the Ministry of Digital Development, Communications and Mass Media, the revenues of IT companies in 2020 could drop by 30 bln rubles ($403.8 mln) to 93 bln rubles ($1.3 bln) unless the government approves earlier proposed measures on supporting the sector. Meanwhile, the average number of IT specialists will diminish in the second half of 2020 by 27,000 and return to the pre-crisis level only by 2024.

As of early 2020, the total number of IT specialists employed in Russia’s digital economy stood at 1.45 mln, the Information & Computer Technologies Industry Association (APKIT) says.

The revenues of IT companies as of late April plummeted 40% and could further decline by June, said Alexei Smirnov, director general at BaseAlt SPO, which develops Russian operational systems. According to him, nearly one-third of IT companies would not survive the current conditions unless the proposed support measures are implemented.

The ministry’s proposed support package for the sector includes deferring income tax payments, cancelling insurance fees to the salary fund and reducing the VAT to zero for online education, telemedicine and food delivery services by the end of the year.


Izvestia: PACE summer session delayed until September, Russia’s envoy says

The June session of the Parliamentary Assembly of the Council of Europe, which has been postponed over the coronavirus pandemic, will be preliminarily held in September, Russia’s Permanent Representative at the Council of Europe Ivan Soltanovsky said in an interview with Izvestia.

"On April 30, a decision was made to put it off [the Assembly’s session] until things get better or until autumn. But everything here depends on how quickly the epidemiological situation improves. For us, it’s of principal importance that all 47 national delegations take part in the session," Soltanovsky stressed. "Now, two sessions are being formally discussed. The summer session will be preliminarily postponed until September and there is also a proposal on holding the October session," he noted. The summer session was originally scheduled for June 22-26.

According to the envoy, now the organization has to decide whether it will remain a platform for settling political accounts or should it put forward a positive agenda. "I would call this kind of a test for self-purification for the Council of Europe."

"We are facing a crusade to politicize human rights. This is unacceptable for us that this issue is being used as an excuse to discredit those countries (we are among them) that are pursuing an independent foreign policy course. And certainly, we disagree with those who focus solely on political human rights, no matter how important they are. Amid the global pandemic, a plethora of other problems in the fields of healthcare, social protection and education have exacerbated. So they should be given priority," he stressed.

The envoy recalled that at the first online meeting of the envoys on April 22, despite certain difficulties, a declaration on combating the pandemic was adopted. It is important because the Council of Europe backed the efforts of all member-states on beating the new infection and highlighted the need to unite efforts in the fight against the pandemic, he said. "For us, this is evident, but this collective appeal from the CE is important in a situation when Europe remains divided and our country is subject to sanctions pressure, which looks completely odious against the backdrop of a global pandemic threat, which is far from being overcome."


Kommersant: Coronavirus deals heavy blow to Russia’s infrastructure sector

Russia’s infrastructure sector will lose some 818 bln rubles ($11 bln) or 13% of annual revenues by the end of May over the coronavirus pandemic and quarantine measures, analysts at InfraOne Research estimate. The lion’s share of this sum accounts for transportation infrastructure, which will lose 519 bln rubles ($7 bln) by the summer, with aviation suffering enormous damage. The losses of Russian airlines are estimated at 271 bln rubles ($3.7 bln), while the airports’ shortfall in profits will be 51 bln rubles ($690 mln). Russia’s railway transport will lose some 66 bln rubles ($892 mln), InfraOne predicts.

The social infrastructure’s shortfalls will hit 205 bln rubles ($2.7 bln), and medical facilities will be the most affected. According to InfraOne, the situation here is more serious than in aviation transportation because some companies’ lost nearly 100% in monthly profits.

Meanwhile, the losses in the energy sector were lower than predicted and less than in other countries, InfraOne notes, according to Kommersant business daily. Whereas in Germany and Italy, energy consumption in April dropped 10% and 25%, respectively, this figure in Russia was just 2.9%. The sector will lose 37 bln rubles ($500 mln), analysts estimate. However, there are some sectors, which have only benefited from the pandemic. First of all, these are telecoms and IT. Most revenues will be earned due to mobile communications (48.1 bln rubles or $596 mln) and broadband Internet (11.5 bln rules or $155.5 mln).


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