Daily Archives: June 17, 2008

08MOSCOW1729, A FIRST LOOK AT MEDVEDEV’S REGIONAL POLICY

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Reference ID Created Released Classification Origin
08MOSCOW1729 2008-06-17 12:54 2011-08-30 01:44 CONFIDENTIAL Embassy Moscow

VZCZCXYZ0008
PP RUEHWEB

DE RUEHMO #1729/01 1691254
ZNY CCCCC ZZH
P 171254Z JUN 08
FM AMEMBASSY MOSCOW
TO RUEHC/SECSTATE WASHDC PRIORITY 8641
INFO RUCNCIS/CIS COLLECTIVE PRIORITY
RUEHXD/MOSCOW POLITICAL COLLECTIVE PRIORITY

C O N F I D E N T I A L MOSCOW 001729 
 
SIPDIS 
 
E.O. 12958: DECL: 06/17/2018 
TAGS: PGOV PHUM SOCI RS
SUBJECT: A FIRST LOOK AT MEDVEDEV'S REGIONAL POLICY 
 
REF: VLADIVOSTOK 00058 
 
Classified By: Political M/C Alice G. Wells.  Reason:  1.4 (d). 
 
1. (SBU) Summary.  Regional policy and center-periphery 
relations have not enjoyed primacy of place for President 
Medvedev thus far, as the new president focuses on judicial 
reform; his anti-corruption campaign; and building a team of 
supporters in Moscow.  Events on the ground, however, could 
force him to take a more assertive stance.  Over the past 
week, rumors about Moscow plans to strip the "presidential" 
moniker for the heads of the national republics has led to 
sharp words from Yeltsin-era warhorse and United Russia 
co-chair, Tatarstan President Mintimer Shaymiev, against the 
"Putin" system of appointing regional elites, rather than 
having direct elections.  Given the challenges facing the 
center's agenda for promoting political and economic 
development in the regions, Medvedev is likely to be drawn 
into regional issues -- an area in which he may chose to 
differentiate himself from his predecessor.  End Summary. 
 
Not Much to Go On 
----------------- 
 
2. (SBU) Despite the theorizing about the significance of 
cadre appointments at the federal level as a tool for 
understanding the relative balance of power in the tandem 
government, our contacts have had little to say about 
Medvedev's policies toward the regional leadership.  In part, 
that reflects a clear lack of evidence.  Unlike Putin, whose 
opening gambit as President limited the influence of regional 
elites on federal policy by removing the governors from the 
Federal Council and establishing "viceroys" (Polpreds) to 
supervise local politics, Medvedev has paid little attention 
to regional issues in his first month in office, despite his 
early active role as candidate promoting the National 
Projects. 
 
3. (SBU) From all indications, Putin took care in his last 
months in office to clear regional deadwood, replacing 
governors in Irkutsk, Arkhangelsk, and Ryazan before handing 
power to his successor.  Most of the remaining governors 
still have time to serve before their mandates expire, with 
the expectation that any wholesale change in regional cadre 
policy to come only in late 2009 or early 2010.  At the same 
time, he signed a decree transferring responsibility for 
overseeing the evaluation of "effectiveness criteria" for 
governors to the White House, inserting himself into the 
evaluation process. Many here interpreted Putin's efforts as 
carving out an influential position vis-a-vis the governors 
at Medvedev's expense. At the same time, Putin's last ditch 
activities as President provided Medvedev a breathing space 
to turn his attention to other issues, leaving regional 
politics to continue largely on their own momentum.  (The 
notable exception has been the criminal investigations around 
the governors Sergey Darkin of Primorskiy Krai and Amur 
Oblast, which most analysts link to the anti-corruption mood 
in Moscow vice any question of center-regional relations 
(reftel)). 
 
4. (C) Oksana Goncharenko of the Center for Current Political 
Affairs suggested that Medvedev's reticence to tackle 
regional issues may be a reflection of his very weak "bench" 
of supporters who he could appoint to fill gubernatorial 
positions.  She noted that his first appointment, picking 
Valeriy Gayevskiy to replace Aleksandr Chernogorov as 
Stavropol governor, was made at the behest of Minister for 
Regional Development Dmitriy Kozak and said she does not 
consider Gayevskiy a "Medvedev man."  Stavropol regional 
representative to the Federal Government, Aleksey Bednov, 
agreed with that assessment and noted that Gayevskiy came 
from the same Komsomol background as the other top regional 
elite.  Bednov claimed that the new governor had worked well 
with Kozak when he served as Putin's polpred to the Southern 
district.  Goncharenko pointed out that Gayevskiy's 
appointment contrasts with the broader trend of seeding 
"outsiders" into the governor's chair as a means of insuring 
fealty to Moscow over the interests of regional elites and 
industrial-finance groups -- such as Putin's appointment of 
non-locals Vladimir Artyakov in Samara and Igor Esipovich in 
Irkutsk. 
 
Shaymiev Speaks Out 
------------------- 
 
5. (SBU) Events this week could push Medvedev to involve 
himself in regional issues more directly.  The catalyst for 
change may be the unexpected criticism from one of the most 
influential regional voices, Tatarstan President Mintimer 
Shaymiev about Putin's policy of "appointing" governors to 
office.  In public comments to the Tenth Worldwide Congress 
of the Russian Press on Saturday, Shaymiev called for return 
to the direct election of governors and he criticized the 
legislation that authorizes the President to dismiss any 
regional parliament that refuses to approve the Kremlin's 
choice for governor. 
 
6. (SBU) Shaymiev's comments followed the June 9 publication 
on the Gazeta.ru website of an article, claiming that the 
Tatarstan legislature would be voting to approve changes to 
the region's constitution to give greater au
thority to the 
regional prime minister and eliminate the office of 
president.  Shaymiev's administration reacted quickly to 
dismiss the allegations, but apparently the issue continues 
to percolate.  Initial assessments here viewed the 
controversy as a result of wrangling for position within the 
Tatarstan elite, with Shaymiev's call for a return to 
elections as a ploy to hold onto power. But, that regional 
in-fighting has already shaped the political discourse in 
Moscow. 
 
7. (C) In the background, there are expectations that 
Medvedev will reverse Putin's regional policy and endorse the 
election of governors.  The head of the Public Chamber's 
Commission on Regional Development Vyacheslav Glazychev sees 
Putin as putting economic growth before institutions and 
Medvedev taking the opposite approach - recognizing that 
institutions themselves help to facilitate development. 
Aleksey Kara-Murza of the Union of Right Forces (SPS) argued 
to us that only by returning to democratic institutions can 
Russian federalism function and he voiced his hopes that 
Medvedev will make the right decisions. 
 
8. (SBU) United Russia Duma Deputy Andrey Isaev publicly 
dismissed Shaymiev's criticisms, noting that his party still 
holds great respect for Tatarstan President as one of the 
founders of United Russia, but sees no need for a change in 
regional policy.  Yet, according to the head of the Duma's 
Committee for Constitutional Legislation and State Building, 
Vladimir Pligin, the issue has already been a topic for 
inter-party discussions.  Pligin reinforced that there were 
no immediate plans, however, for making the change and 
suggested 2012 as a possible target date for a reform of 
regional policy, according to press reports. Pligin's 
timeline corresponds with pre-inauguration comments 
reportedly made by Medvedev to Civil Forces leader Mikhail 
Barshevskiy, recognizing the need for a return to direct 
elections, but arguing that Russia still needed the 
short-term stability that presidential appointments provided. 
 
Comment 
------- 
 
9. (SBU) Given recent events, Medvedev's breathing space for 
dealing with regional issues may be smaller than he first 
considered, although he seems well-positioned to ride out any 
turbulence caused by Shaymiev's comments.  Although he has 
not yet publicly reacted to Shaymiev's comments, there is an 
expectation among some Kremlin analysts that Medvedev will 
seek to differentiate himself from Putin's "vertical of 
power" approach.  Putin's hasty moves to replace some of the 
weakest governors and his last minute decree, giving the 
White House authority for managing the "effectiveness 
criteria" for governors, helped to give Medvedev some 
maneuvering room, but also suggest that Putin plans to play a 
central role in managing center-periphery relations.  As of 
yet, it is too soon to see how Medvedev's regional policy 
will develop or how those authorities will be divided amongst 
the tandem. 
RUSSELL

Wikileaks

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08MOSCOW1725, MOLINK PROPOSAL PASSED

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Reference ID Created Released Classification Origin
08MOSCOW1725 2008-06-17 10:58 2011-08-30 01:44 SECRET Embassy Moscow

VZCZCXYZ0001
RR RUEHWEB

DE RUEHMO #1725 1691058
ZNY SSSSS ZZH
R 171058Z JUN 08
FM AMEMBASSY MOSCOW
TO RUEHC/SECSTATE WASHDC 8638
INFO RUEKJCS/SECDEF WASHDC
RHEHNSC/NSC WASHDC
RUEKJCS/JOINT STAFF WASHDC
RUEAIIA/CIA WASHDC

S E C R E T MOSCOW 001725 
 
SIPDIS 
 
E.O. 12958: DECL: 06/16/2018 
TAGS: MARR PARM PREL RS
SUBJECT: MOLINK PROPOSAL PASSED 
 
REF: STATE 63948 
 
Classified By: Political Minister Counselor Alice G. Wells for reasons 
1.4 (b) and (d). 
 
(S) On June 17 we passed reftel nonpaper to MFA North America 
Third Secretary Ruben Malayan, who told us his office would 
study the proposal and respond at a later date. 
RUSSELL

Wikileaks

08MOSCOW1723, Third Annual Embassy IPR Roundtable Highlights Progress in

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Reference ID Created Released Classification Origin
08MOSCOW1723 2008-06-17 09:20 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Moscow

VZCZCXRO1118
RR RUEHAG RUEHDF RUEHIK RUEHLN RUEHLZ RUEHROV RUEHVK RUEHYG
DE RUEHMO #1723/01 1690920
ZNR UUUUU ZZH
R 170920Z JUN 08
FM AMEMBASSY MOSCOW
TO RUEHC/SECSTATE WASHDC 8632
INFO RUEHLN/AMCONSUL ST PETERSBURG 4986
RUEHVK/AMCONSUL VLADIVOSTOK 2871
RUEHYG/AMCONSUL YEKATERINBURG 3215
RUCNCIS/CIS COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHDC
RUCNMEM/EU MEMBER STATES COLLECTIVE

UNCLAS SECTION 01 OF 02 MOSCOW 001723 
 
STATE FOR EB/TPP/IPE, EUR/RUS 
STATE PLS PASS USTR SMCCOY, PBURKEHEAD 
USDOC FOR 4231/MAC/RISD 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958 DECL: N/A 
TAGS: ECON KIPR WTO RS
SUBJECT:  Third Annual Embassy IPR Roundtable Highlights Progress in 
Russian Software Industry 
 
MOSCOW 00001723  001.2 OF 002 
 
 
This message is sensitive but unclassified and is not intended for 
Internet distribution. 
 
1.  (SBU)  Summary: The Charge on May 23 hosted a roundtable for 
over 90 participants to discuss IPR protection and innovation in the 
Russian software industry.  Participants indicated that the software 
piracy situation in Russia has dramatically improved thanks to a 
combination of government and industry initiatives.  However, there 
was also a consensus that there was room for further improvement, 
including especially in fighting Internet piracy, reducing official 
corruption, and better coordinating law enforcement efforts.  End 
Summary 
 
Participants 
------------ 
 
2.  (U)  This is the third year that the Chief of Mission has hosted 
an IPR roundtable.  The previous years' discussions focused on 
Russia's movie and music industries respectively.  The International 
Chamber of Commerce and the Ministry of Economic Development again 
co-hosted the event.  Roundtable participants included prominent 
Russian software company executives, representatives of American 
software companies such as Microsoft and Adobe, as well as officials 
from the Ministry of Culture, Duma, MVD, General Procuracy, 
Rossvyaznadzor (formerly Rossvyazokhrankultura), Moscow city police, 
and Moscow city government.  Russian media outlet RBC provided 
exclusive coverage of the event, with stories distributed through 
its wire service, online, and on TV. 
 
Russia Making Progress on Piracy 
-------------------------------- 
 
3.  (SBU) Industry representatives noted that the software piracy 
rate in Russia has gone down significantly in the last four years. 
The Business Software Alliance (BSA) representative said that their 
latest statistics, released just a week before the roundtable, 
showed that it dropped 7 points in 2007 from 80% to 73%.  This 
reduction is especially significant compared to the annual 3% 
reduction of the past few years.  Microsoft Vice President Vahe 
Torossian put the numbers in perspective - every percentage 
reduction in piracy rate represents $150 million in legitimate sales 
and wages paid to employees.  Calculating from the 90% piracy rate 
of 2004, the progress made in combating software piracy in Russia 
has meant a total of $2.55 billion in recovered revenue and salary 
for the industry in the last four years. 
 
4. (SBU) Industry representatives and Russian government officials 
were unanimous in noting that the software IPR situation is much 
better than that of the music and film industries.  The roundtable 
participants attribute the improved IPR situation for software to a 
combination of government and private sector initiatives.  Boris 
Nuraliyev, the founder of the software company 1C and nicknamed "the 
Bill Gates of Russia," noted that increasing cooperation between 
rights holders and law enforcement agencies has resulted in 
stepped-up action against pirates.  Nuraliyev also credited better 
organization within the industry, particularly through the Nonprofit 
Partnership of Software Suppliers (NP PPP), which unites 300 Russian 
and foreign companies, and more public outreach to educate consumers 
for the improved IPR protection. 
 
5.  (SBU)  Yevgeniy Bakhin, Marketing Director of Russian software 
company Askon, while acknowledging Russian law enforcement efforts 
in combating piracy, noted that the IPR focus in Russia is 
overwhelmingly on punishment and argued that more positive 
incentives are needed to reward the use of legitimate products.  He 
highlighted his company's marketing campaigns that demonstrate to 
consumers the economic benefits of using legitimate software - 
quality assurance, access to company's support services, and clear 
pricing.  According to Bakhin, a particularly useful step his 
company has taken is providing schools with free software, so that 
young students get used to legal versions of the company's products 
and therefore have more inclination to continue to use legitimate 
software and the company's services as they grow into consumers. 
 
 
6.  (SBU)  The Russian participants expressed disappointment that 
the IPR reputation of the country has not improved along with the 
progress that they are seeing on the ground.  Nuraliyev and General 
Director of software company ABBYY Grigoriy Lipich noted that their 
companies have more piracy problems in other CIS countries than in 
Russia, but IPR issues appear to continue to impede Russian WTO 
 
MOSCOW 00001723  002.2 OF 002 
 
 
membership while other CIS members (e.g. Ukraine) have been allowed 
to join.  MED Advisor to the Minister Yuriy Lyubimov said that the 
GOR was surprised that Russia remained on the Priority Watch List 
during the 2008 Special 301
 review despite the progress made, but 
pledged to continue to make improvements in Russia's IPR record. 
 
Remaining Challenges 
-------------------- 
 
7.  (SBU)  Roundtable participants identified Internet piracy, 
official corruption, and better law enforcement coordination as 
challenges that require further attention.  While limited broadband 
access in Russia has not made online software piracy a significant 
issue, most saw it as the inevitable next battleground for IPR 
protection, as in the music and movie industries.  Already, many 
websites registered both in Russia and abroad are doing brisk 
business selling pirated Russian software (but mostly offering 
delivery by mail rather than direct download). 
 
8.  (SBU)  Industry representatives appealed for better inter- and 
intra-governmental cooperation to counter this transnational 
problem.  BSA representatives offered some concrete suggestions for 
combating official corruption among law enforcement ranks and 
improving the effectiveness of enforcement actions.  They included 
more authority to conduct raids by Department K, the computer crimes 
division of MVD; better forensics methodology; and improved 
coordination between the MVD and the General Procuracy Investigative 
Committee. 
 
Comment 
------- 
 
9.  (SBU)  While many Russian officials still see IPR as a "Western" 
issue, events such as our roundtables that emphasize Russian rights 
holders' concerns are changing that mindset.  Three years ago, we 
had to practically wrestle the two sides into sitting down at the 
same table.  Now, officials and industry representatives meet often 
and are comfortable dealing with each other, even if they still have 
differences of opinion.  As we continue to press the GOR to fulfill 
its IPR obligations under both WTO rules and the bilateral IPR Side 
Letter, the recognition that better IPR enforcement brings benefits 
to Russia's own creative and innovative industries that should lead 
to lasting change. 
 
RUSSELL

Wikileaks