Monthly Archives: January 2009


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Reference ID Created Released Classification Origin
09MOSCOW230 2009-01-30 15:45 2011-08-30 01:44 CONFIDENTIAL Embassy Moscow


DE RUEHMO #0230/01 0301545
O 301545Z JAN 09

C O N F I D E N T I A L MOSCOW 000230 
E.O. 12958: DECL: 01/30/2019 
REF: 08 MOSCOW 3689 
Classified By: Political Minister Counselor Alice G. Wells; reason 1.4 
1. (C) Summary:  On January 27 Russian President Dmitriy 
Medvedev ordered his administration to rework legislation 
submitted by the White House on December 12 containing 
amendments to the sections of the Criminal Law and Criminal 
Procedures Codes before the State Duma and Federation Council 
could take any action on it.  The proposal, submitted by the 
State Security Service, would have expanded the definition of 
treason and added non-governmental organizations (NGOs) to 
the list of banned recipients of state secrets.  Human rights 
activists who had criticized the legislation as overly broad, 
hailed Medvedev's decision.  The presidential intervention 
helps restore Medvedev's image among a human rights community 
dismayed by the recent restriction on the use of juries in 
trials involving terrorism.  End Summary. 
Medvedev Triumphs Over Hard-liners 
2.  (SBU) Medvedev instructed his office to take a closer 
look at proposed amendments to the Criminal Code and the 
Criminal Procedure Code regarding state secrets, high treason 
and espionage.  On January 27, Medvedev's First Deputy Chief 
of Staff Vladislav Surkov announced that Medvedev had "paid 
attention to the opinions on the issue that have been voiced 
in the media and society in general" and that "possibly there 
was a danger that the concepts of state secrets, high treason 
and espionage could be construed too broadly."  On January 14 
the daily Nezavisimaya Gazeta had already reported that the 
Duma's Committee on Laws would not discuss the proposed 
legislation submitted on December 12 by the White House for 
its review. 
3.  (C) Leaders of Russian human rights NGOs generally 
supported Medvedev's action.  Some had compared the proposed 
legislation with edicts by Stalin and Hitler.  Lev Ponomarev, 
head of the NGO For Human Rights, said that Medvedev's 
decision was "a landmark and pivotal moment" in which the 
president had heeded the opinion of civil society.  Oleg 
Orlov from Memorial Center said he was pleasantly surprised 
by Medvedev's action, but withheld final judgment until he 
saw the reworked language.  The Kremlin-linked Public Chamber 
had also criticized the proposed changes (reftel), including 
Medvedev booster Pavel Astakhov. 
4.  (C) Leonid Nikitinskiy, editor of Novaya Gazeta and the 
head of an association to support jury trials, predicted on 
January 19 that that Medvedev would order revisions to the 
espionage law.  He added that despite Medvedev's signing of 
the law removing certain crimes from the jurisdiction of jury 
trials, Elena Panfilova of Transparency International had 
sent Medvedev a letter at the end of December recommending, 
inter alia., that the proposed legislation be amended to 
narrow the definitions of treason and espionage.  Nikitinskiy 
maintained that Medvedev had not wanted to sign the law 
restricting jury trials, but that security organs had 
countered that the only alternative was eliminating jury 
trials altogether.  He told us January 30 that the law was 
stalled because of a general recognition that it was worded 
too broadly.  He said the definitions of espionage and 
treason are being made more narrow and that the references to 
"assisting foreign and international organizations" was being 
redrafted to refer only to "international organizations." 
Nikitinskiy thought this was a significant amendment but that 
he did not know the ultimate fate of the law, implying that 
it might simply stay bogged down at the Presidential 
Administration in the re-drafting phase -- a very good thing 
in his opinion. 
5.  (C) This marks only the second time that Medvedev and 
Putin may have been on different sides of a proposed law, 
given that the draft law to which Medvedev objected came from 
the White House.  In the summer of 2008, Medvedev pulled from 
the Duma's review a proposed law on mass media after a 
similar response by civil society and influential members of 
the Public Chamber.  However, our contacts downplay the 
legislative back-and-forth as any reflection on the Putin 
-Medvedev relationship; instead, the posit the proposed 
legislation as the work of hard-liners within the siloviki 
rather than the Office of the Premier.  In the short run, 
Medvedev's action has helped ameliorate disappointment among 
the human rights community over the jury trial setback, 
although it remains to be seen what compromise language the 
President's Office will come up with. 



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Reference ID Created Released Classification Origin
09MOSCOW226 2009-01-30 15:25 2011-08-30 01:44 SECRET Embassy Moscow


DE RUEHMO #0226/01 0301525
P 301525Z JAN 09

SS E C R E T MOSCOW 000226 


E.O. 12958: DECL: 01/30/2019 

REF: MOSCOW 00202 

Classified By: Ambassador John Beyrle. Reason: 1.4 (d). 

1. (S) Summary. With their usual light touch and unique sense 
of timing, the security services appear to be tightening the 
screws on what they see as Russia's internal and foreign 
enemies along three fronts. First was a confidential letter 
from the Federal Security Service (FSB) demanding that USAID 
stop funding NGOs in the North Caucasus. Second, the Interior 
Ministry has brought pressure on the liberal Higher School of 
Economics to expel students who took part in anti-government 
demonstrations in December. Third, and most disturbing, we 
believe the FSB is behind a personal smear attack
XXXXXXXXXXXX the National Democratic Institute's Moscow
office (NDI) that was emailed to NDI and USAID staff this week.
The second provocation has become a public issue, with 
critical articles even in the popular tabloid, Moskovskiy 
Komsomolets, on Ren TV, and commentary on prominent blog 
sites. Taken together, we assess that hard-line silovik 
elements are testing the political waters at home and 
potentially making waves at a time of otherwise positive 
signals of interest in improving US-Russian relations. End 

Warning to USAID 
2. (S) A January 17 letter from the FSB, sent through liaison 
channels, explicitly warned against continued USAID funding 
for NGOs in the North Caucasus. Citing a November trip by a 
named USAID officer, the FSB alleged that US funding to the 
region was "incompetent" and that USAID was not in a position 
to guarantee that funds provided for humanitarian programs 
did not fall into the hands of illegal armed groups. Given 
the tensions in South Ossetia, as well as the conflict in the 
Middle East, the FSB gave notice that "it is necessary to 
refrain from financing any NGO in the North Caucasus, 
regardless of USAID's goals." The letter closed with an 
ominous admonition that unless USAID stops its "incompetent 
actions," the FSB would implement strict preventative 
measures, including the denial of visas. 

3. (S) The FSB letter attempted to justify its position by 
highlighting the complexity of nationalities and religions in 
the North Caucasus, the prevalence of extremist movements, 
and the predominant role played by family loyalties as 
factors that made funding of NGOs in the region dangerous. 
The FSB made implicit threats that information about US 
funding of illegal groups would likely be made public through 
the media, damaging US-Russian counterterrorism efforts. 
Further, the letter noted that "incompetent actions" on the 
part of the "Embassy sections, like USAID" could escalate 
tensions in regions beyond the borders of the North Caucasus 
to the detriment of US and Russian interests. When the 
Ambassador protested this FSB salvo, Deputy Foreign Minister 
Ryabkov claimed (credibly) that the security service 
complaints had not been coordinated with the MFA. 

Warning to Students 

4. (SBU) In mid-January, the Moscow branch of the MVD issued 
a letter to the Higher School of Economics, raising the issue 
of four students (possibly six) who participated in December 
opposition marches with the veiled recommendation that they 
be expelled. According to press reports, the letter warned 
"implementation of un-sanctioned mass acts was one of the 
forms of extremist activity, carrying a high level of 
societal danger, and demands adequate reactive measures on 
the part of the law enforcement organs." The MVD called on 
the institute to look into the circumstance of the students' 
participation in the opposition protests and to consider the 
efficacy of continuing their education. Further, the letter 
sought comments from the heads of the Politics and Economics 
departments about extremism, as well as personal statements 
from the four students. MVD sources told the newspaper 
Moskovskiy Komsomolets (MK) that they were "legally required" 
to inform the place of employment or school of any citizens 
violating social stability. 

5. (C) The institute will hold a meeting on February 4 to 
consider its response, but public comments by the director 
and rector suggest that the school considers such political 
activity to be a "personal" decision, beyond the scope of 
"no way" that the institute would adhere to the 
recommendations of the MVD and underscored the unanimity
of  the faculty and student body on this issue. Nezavisimaya 
Gazeta criticized the letter, seeing it as a demonstration of 
the government's "panic" after the anti-tariff protests and 
highlighting the "Soviet" aspect of going after politically 
"unreliable" students. Besides the usual lineup of opposition 
newspapers and websites, the MK article ensures that a 
broader swath of society will learn about this incident -- 
already it has spawned a sharp reaction of support for the 
students and condemnation of the MVD in Russia's blogosphere. 

was sure that other institutes and universiti
es had received
similar letters, but had chosen not to make the silovik
demands public or had quietly capitulated. Our consulate
in St. Petersburg noted last year's closing of the European
University, ostensibly for "fire safety" issues, because of
the Political Science department had taken a grant to do
research on electoral politics in Russia. 

Getting Ugly and Personal with NDI 

7. (C) On January 29, USAID FSNs received an email from 
XXXXXXXXXXXX with a photoshopped image of 
XXXXXXXXXXXX reclining with an underage 
child. The picture was attached to a message, ostensibly from 
a Russian citizen, which accused XXXXXXXXXXXX of raping
her  9-year old daughter. This latest provocation falls on the 
heels of a scandal in Murmansk alleging NDI interference in 
local elections and harassment of NDI staff XXXXXXXXXXXX. 
The Ambassador met with representatives from NDI on January 
30 on harassment of the NGO, reported septel. 

Panic or Provocation 

8. (C) Emboldened by the economic crisis, the silovik forces 
have taken the initiative to stir the waters of Russian 
politics, not only with those letters, but also with the 
proposed revision of the law on treason, on jury trials, and 
the heavy-handed response to the protests in Vladivostok. 
Some of those initiatives have been blunted directly, such as 
Medvedev's decision to revise the proposed law on treason, 
others by publicizing the issue (the letter to the Higher 
School of Economics, for example, received coverage in the 
popular tabloid MK and on Ren TV) -- suggesting an 
intensification of inter-elite conflict. 

9. (C) Comment. We cannot rule out that those provocations 
may in part be directed at complicating efforts to improve 
US-Russian relations. At a time when both Putin and Medvedev 
have indicated the potential for starting with a clean slate 
in relations with the new Obama administration, those within 
the security services who see value (including to their 
budgets) from continued tensions or whose world view is 
predicated on US-Russia conflict are likely under pressure to 
play a spoiler role. Ambassador plans to raise all of those 
incidents forcefully in high-level meetings next week to send 
a message back flagging the risks inherent in allowing rogue 
elements to run amok in the relationship. End Comment. 



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Reference ID Created Released Classification Origin
09MOSCOW224 2009-01-30 14:14 2011-08-30 01:44 CONFIDENTIAL Embassy Moscow

DE RUEHMO #0224/01 0301414
R 301414Z JAN 09

C O N F I D E N T I A L SECTION 01 OF 02 MOSCOW 000224 
E.O. 12958: DECL: 01/30/2019 
REF: A. 08 TBILISI 2222 (NOTAL) 
     B. TEFFT-FRIED E-MAIL DEC 17 2008 
Classified By: Ambassador John R. Beyrle: Reasons 1.4(b) and (d) 
1.  (C) Summary:  While Russian analyst Pavel Felgenhauer's 
prediction of an August war with Georgia has been seized upon 
by Georgian decisionmakers as proof of Russian responsibility 
for the war (reftels), he is held in low regard by other 
respected Russian military analysts.  Felgenhauer enjoys 
being quotable, which -- combined with his fluent English and 
investment in the diplomatic circuit -- has helped cultivate 
his high profile.  In polling other leading military 
analysts, we were told that Felgenhauer lacks access to 
military circles, a charge he does not deny.  Noting that 
Felgenhauer has made a number of less successful predictions, 
these analysts suggest that he lucked out in his prognosis, 
with all -- including Felgenhauer -- maintaining that it took 
Georgian actions on August 7-8 to trigger the inevitable 
Russian military response.  End Summary. 
2.  (C) Embassy Tbilisi has reported that Russian military 
analyst Pavel Felgenhauer enjoys considerable confidence in 
high government circles in Georgia, including with President 
Saakashvili, thanks to his May 2008 prediction that Russia 
would "launch a war" against Georgia in August of that year 
(reftels).  Felgenhauer's December 2008 article in Novaya 
Gazeta, suggesting plans for a new war against Georgia, in 
order to put an end to the ongoing violence in the security 
zones in South Ossetia and Abkhazia, has likewise garnered 
attention and Georgian concern.  When we met with 
Felgenhauer, he maintained that Russia sought to "finish the 
job" of ousting Georgian president Saakashvili, with the goal 
of preventing Georgia's NATO accession and further eroding 
Georgian territorial integrity.  He forecast mid-April as the 
earliest starting date for a conflict, but when pressed 
allowed the war might only begin months later, or even in 
2010.  While Felgenhauer's accessibility and command of the 
English language make him popular on the Moscow diplomatic 
circuit, Felgenhauer receives faint and sometimes damning 
praise from rival military analysts. 
Felgenhauer's analyses 
3.  (C) Many military experts and commentators we surveyed 
took issue with Felgenhauer's military commentary, including 
his latest prediction of a war with Georgia in April 2009. 
While Aleksandr Golts, Deputy Editor of Yezhenedelniy 
Journal, insisted he "didn't comment on colleagues," he did 
note Felgenhauer had "predicted a lot of things," including 
that Georgia would win the August 2008 war.  He dismissed 
Felgenhauer's assessment that there would be a new war with 
Georgia in April, provided Saakashvili did not seek to take 
Abkhazia and South Ossetia back by force.  Yevgeniy Volk from 
the Heritage Foundation told us Felgenhauer was "not a 
military expert, although he tries to be."  Noting that 
Felgenhauer's educational background was in biology and not 
military affairs, Volk suggested that for a non-military 
expert, Felgenhauer "said a lot of the right things;" 
however, for military experts, what he said "did not make 
sense when put together."  Carnegie Center Director Dmitriy 
Trenin barked "humbug" when asked whether Felgenhauer was an 
astute analyst.  Calling him "vain" and "grandiose," Trenin 
said Felgenhauer conflated Russian preparations for war with 
an intent to go to war.  A trigger was required, he stressed, 
and Saakashvili delivered it on August 7-8. 
4.  (C) Felgenhauer's predictions of another imminent war 
have left many experienced Russian observers unimpressed. 
Pavel Zolotarov, retired General and Deputy Director of 
U.S.A.-Canada Institute, stated it was in neither Russia's 
nor Georgia's interest to start a new war in April, due to 
the necessity to deal with the economic crisis.  While 
allowing that a lack of trust was contributing to tensions 
and causing each side to accuse the other of preparing for 
war, Ivan Safranchuk of the World Security Institute agreed 
with Zolotarov that neither side actually wanted a new war. 
Conceding Russia might want to "finish the job" by 
overthrowing Saakashvili, Safranchuk asserted Russia would 
make no such move, as the international community would be 
outraged if Russia invaded Georgia again. 
Deliberately provocative 
5.  (C) Aleksandr Belkin of the Council of Foreign and 
Defense Policy agreed with Golts that Felgenhauer sometimes 
engaged "in a style similar to yellow journalism," in order 
MOSCOW 00000224  002 OF 002 
to attract attention to himself and his articles.  Belkin 
criticized Felgenhauer's prediction of an April 2009 war as 
another example of going too far for publicity's sake. 
Another example of Felgenhauer's flair for the dramatic was 
his comment in a September 27, 2008 interview with The 
Guardian that the Russian
 leadership believed a war with NATO 
was possible, and that the Russian military was preparing for 
an "all-out nuclear war with America."  While we assume 
Russia, like the U.S., has nuclear contingency plans, 
Felgenhauer delights in drawing the worst interpretation. 
Embassy officers continue to meet with Felgenhauer, but over 
the last several years have relied on him less for his 
interpretation of military developments. 
Felgenhauer's access 
6.  (C) Analysts such as Golts also note that while 
Felgenhauer is received at high levels in Tbilisi, he has no 
access to Russian military or political circles.  In contrast 
to other analysts, who have served as military officers in 
the Ministry of Defense or other military agencies, and often 
travel with the Minister of Defense or the Chief of General 
Staff, Felgenhauer is rarely invited to MOD background 
briefings.  Felgenhauer readily admits that most of his 
material is derived from the press, think tanks, and 
non-Russian government officials.  While Felgenhauer gets 
high marks from some for his ability to piece together rumors 
and reports into convincing commentaries on intra-MOD 
developments, others, such as commentator and author Vladimir 
Solovyev, are less flattering: "there are 1000 journalists in 
Russia and occasionally, no matter how stupid, they can sound 
right."  Solovyev maintained that Felgenhauer was frozen out 
of the Ministry of Defense, where he was viewed as a gadfly. 
When asked whether he read Felgenhauer's reports to assess 
political-military debates or trends in Russia, Solovyev 
said, "No, I call my contacts in the military."  Trenin told 
us that Felgenhauer enjoyed access 15 years ago, in the 
initial hurly-burly of the Yeltsin years, but no longer. 
7.  (C)  Felgenhauer struck analytical gold with his 
prediction of an August war, but his prescience appears to be 
in divining at what point Saakashvili would take the liberal 
bait laid down by Russia.  Felgenhauer, like all analysts 
with whom we spoke, agreed that once Tbilisi launched an 
attack on Tskhinvali and on Russian peacekeepers, a massive 
Russian retaliation was guaranteed.  We place little credence 
in his new prediction of a conflict "anytime after mid-April 
2009," which is too vague to be useful, but broad enough to 
have a chance of coming true.  If Georgia provides Russia 
with a pretext, by responding militarily to provocation along 
the territorial lines, we are confident that Russia will 
respond, whether in April or any time thereafter.  This 
raises the stakes as we negotiate for a continued 
international presence on both sides of the administrative 



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Reference ID Created Released Classification Origin
09MOSCOW220 2009-01-30 13:01 2011-08-30 01:44 CONFIDENTIAL Embassy Moscow

DE RUEHMO #0220/01 0301301
O 301301Z JAN 09

C O N F I D E N T I A L SECTION 01 OF 03 MOSCOW 000220 
E.O. 12958: DECL: 01/26/2019 
Classified By: Ambassador John Beyrle for Reasons 1.4 (b) and (d) 
1.  (C)  Summary.  Current Russian policy toward Central Asia 
seeks to maintain Moscow's historical dominance while 
recognizing the need to cooperate with the U.S. and NATO on 
stabilizing Afghanistan and managing the transnational 
challenges confronting the region.  A not-so-secret agenda to 
lock up energy resources in the region and ensure hydrocarbon 
transit through Russia coexists with an expressed interest to 
assist international efforts to counter terrorism and drug 
trafficking in Afghanistan.  Even amid rumors of Russian 
pressure tactics to persuade the Kyrgyz government to close 
the Manas Air Base to U.S. access (denied by the MFA), the 
GOR is seeking U.S. and NATO participation in a March SCO 
conference on Afghanistan in Moscow.  Discussions on ways to 
cooperate on Afghanistan, a visit by Special Representative 
for Afghanistan and Pakistan Holbrooke and CENTCOM General 
Petraeus to Moscow in the near future, as well as 
consultations on Central Asian issues of common interest, 
could help change the prevalent Russian mindset of a zero-sum 
game in Central Asia.  Reevaluating cooperation with regional 
organizations such as the Shanghai Cooperation Organization 
could help reshape the debate on whither Russia and Central 
Asia, with the February 10-11 consultations by DAS Moon 
providing the opportunity to gauge whether serious 
participation by the U.S. in the March SCO conference will be 
a productive first step.  End Summary. 
Maintaining "Privileged Interests" a Priority 
2.  (C)  Current Russian policy on Central Asia seeks to 
maintain dominance in the region against increased influences 
of countries such as the United States and China, while 
balancing interests in Afghanistan, counter-terrorism and 
counter narco-trafficking that require cooperation with the 
U.S. and NATO.  As top Russian official--including President 
Medvedev and FM Lavrov--have articulated, Russia considers 
the CIS its top foreign policy priority, an area whose 
geography, economic interdependence, and historical 
commonality afford the states "mutually privileged 
relations."  The GOR has announced the creation of a new "CIS 
agency" within the Foreign Ministry, with its director 
double-hatting as a presidential envoy.  While insisting that 
Moscow is not seeking to reestablish a "sphere of influence," 
the GOR has made it clear that it has "special interests" in 
the post Soviet space, seeking to maintain and enhance its 
influence in the region and, by implication, keeping other 
countries from becoming dominant. 
3.  (C)  To be sure, the GOR understands that complete 
Russian domination in the region is no longer possible in 
today's geopolitical environment, especially given the 
Central Asian governments' proclivity to pursue 
multi-vectored bilateral relationships according to their 
varied interests and Moscow's lack of resources to keep the 
five countries completely within its orbit.  In this regard, 
Moscow is careful to refrain from public expressions of 
disapproval of U.S. military presence or increasing Chinese 
commercial interests in Central Asia.  MFA officials have 
been particularly disciplined in repeating the mantra that 
the Central Asian countries are free to pursue closer 
contacts with other countries in accordance to their own 
interests.  Privately, however, the Russians have been using 
to their advantage historical ties, common language, similar 
political systems with authoritarian tendencies, and a 
mixture of strong-arm tactics and financial incentives in a 
bid to keep Central Asia as the Russian backyard. 
Manas, Energy Deals and Military Assistance 
4.  (C)  For example, President Medvedev's just concluded 
January 22-23 visit to Uzbekistan, where he and President 
Islam Karimov reaffirmed the strategic partnership between 
their two countries and discussed a range of proposals 
related to oil and gas, investment, transport, and 
military-technical cooperation, is widely seen as an attempt 
to check Karimov's recent manifestations of a drift toward 
the West.  Similarly, the Russian press in the run up to the 
now rescheduled visit of Kyrgyz President Bakiyev to Moscow 
reported extensively on rumors of a GOR offer of a $2.5 
billion assistance package to Kyrgyzstan in exchange for 
MOSCOW 00000220  002 OF 003 
Bishkek's closure of the Manas Air Base.  The Kyrgyz 
government wasted no time in seizing the opportunity to seek 
more payment from the U.S. for the use of the air base 
(reftel).  The Russian MFA has denied any Russian attempt to 
put pressure on Bishkek, claiming that the reported $2.5 
billion offer is part of the unrelated assistance measures 
the GOR
is providing to help Kyrgyzstan overcome the effects 
of the financial crisis.  Nevertheless, there are enough 
commentaries in the press from experts and analysts to 
indicate that, regardless of the degree to which the reports 
are true, certain parts of the Russian policy elite have deep 
seated qualms about U.S. military presence and, by extension, 
influence, in the Russian backyard. 
5.  (C)  On the economic front, Russia's not-so-secret agenda 
has been to ensure, to the extent possible, that hydrocarbons 
from the region transit Russian territory.  This strategic 
pursuit is rooted not only in geopolitical concerns over its 
"backyard" but also in Russia's desire to seek economic rents 
by monopolizing energy supplies to the West and to make up 
for its own lagging production of both oil and gas.  Russia 
has aggressively and successfully sought contracts and 
commitments from the region's producers, most notably having 
locked up most of Turkmenistan's available gas.  In addition, 
there are nearly 2 million Central Asian migrant workers in 
the Russian Federation.  Their contributions to the Russian 
economy through their labor and to the economies of their 
home countries through remittance payments further tie Russia 
to Central Asia--even as they are frequently exploited and 
abused with little interference from the authorities. 
6.  (C)  Also important in the mix are the Russian military 
installations in all of the Central Asian countries and the 
annual military assistance that Moscow provides.  For 
Kyrgyzstan and Tajikistan in particular, which have weaker 
armies compared to their neighbors, Russian military aid is a 
significant factor in their relationship with Moscow. 
Experts have suggested to us that it is precisely the Russian 
military and the security forces that have a strong, almost 
visceral, reaction to U.S. military presence in Central Asia. 
 The differences between the U.S. and Russia on missile 
defense and NATO enlargement feed into the fear that the use 
of air bases in Central Asia in support of operations in 
Afghanistan would eventually lead to the extension of NATO to 
Russia's southern borders and an encirclement of the country. 
 Even USG gestures to create goodwill among the communities 
around the air bases, such as the provision of care packages 
for World War II veterans, are viewed with suspicion that the 
true aim of our military presence in Central Asia is to 
influence the local populations away from their pro-Russian 
Cooperation on Afghanistan Also Important 
7.  (C)  Despite its focus on maintaining dominance in 
Central Asia, Moscow also understands that it is in its 
interest to support U.S. and NATO aims in Afghanistan 
(septel).  The transnational nature of challenges such as 
terrorism and narco-trafficking are particular concerns to 
Moscow.  The GOR has been active in regional organizations 
such as the Shanghai Cooperation Organization (SCO) and the 
Collective Security Treaty Organization (CSTO) to set up 
working groups on Afghanistan and establish regional 
mechanisms to manage the spill-over effects of such threats. 
Russia since April of 2008 has also extended to NATO a 
transit offer for non-lethal goods intended for the ISAF, and 
President Medvedev reiterated Russian willingness to help 
international efforts to stabilize the situation in 
Afghanistan and combat drug-trafficking and terrorism during 
his Uzbekistan visit. 
8.  (C)  Within the Central Asia context in particular, 
Russia has proposed, through our Counter-Terrorism Working 
Group, the establishment of an information-sharing mechanism 
on narcotics supply routes from Afghanistan.  As the current 
chair of the SCO, Moscow has set Afghanistan as a central 
agenda item and will host in late March or early April an 
international conference on Afghanistan per SCO members' 
agreement at last year's Dushanbe summit.  While details are 
still murky, we understand the GOR intends to invite to 
Moscow all SCO members, observer nations, Afghanistan, the UN 
and other relevant organizations.  The GOR also would like to 
have the United States and NATO participate in the 
conference, recognizing that no meaningful discussion on 
MOSCOW 00000220  003 OF 003 
Afghanistan can take place without our input.  The MFA has 
assured us the intent of the conference is not to evaluate or 
criticize current military operations in Afghanistan, but to 
look at ways to broaden cooperation among interested parties, 
including between Moscow and Washington, and to open up new 
channels of cooperation with NATO.  Our contacts tell us that 
the Russian embassy will be approaching the Department soon 
to discuss the conference concepts, and should the USG 
express interest, the GOR would issue formal invitations to 
participate in the conference. 
Changing the Zero-Sum Mindset 
9.  (C)   Despite MFA denials to the contrary, it has become 
the conventional wisdom in Russia that Central Asia is the 
region in which the interests of Russia, the United States, 
and China conflict in a new geopolitical competition for 
influence.  For the U.S. and Russia, at least, it doesn't 
have to be that way.  With the President's stated priority on 
Afghanistan, as well as President Medvedev and FM Lavrov's 
expressed wish to work constructively with the new 
Administration on Afghanistan (and Iraq), we have an 
opportunity to redefine the way the U.S. and Russia relate to 
each other in Central Asia from that of competing influences 
to cooperation in countering common threats and maintaining 
regional stability.  The planned February 10 consultations 
with the MFA on Afghanistan is one positive step in that 
direction.  Assuming we can confirm a constructive Russian 
policy approach through those discussions, a visit to Moscow 
by Special Representative Holbrooke and General Petraeus in 
the near future would also go a long way in establishing 
common interests and in countering the wide-spread impression 
here that our military presence in Central Asia is a U.S. 
attempt to increase our influence in the region at Russia's 
expense.  On the economic side, helping the Central Asian 
countries cope with the fallout of the financial crisis and 
ensuring the stability of energy supplies in the region could 
also be topics of discussion between the U.S., our European 
partners, and Russia, which could potentially reshape the 
current dynamic of competing financial offers to keep or 
close bases and competing pipelines for energy transport. 
Our efforts to continue to encourage, bilaterally and in 
multilateral fora, free investment regimes and 
commercially-driven (preferably privatized) projects would 
also help counter charges of supporting particular energy 
projects based on political considerations. 
10.  (C)  Adjustments in some of our assumptions regarding 
cooperation with regional organizations such as the SCO could &
#x000A;also help change the Russian zero-sum mindset.  The Shanghai 
Cooperation Organization started out as a mainly economic 
organization, but gradually took on more political issues 
such as counter-terrorism and counter narcotics trafficking 
as discussions about economic cooperation and integration 
stalled.  Unlike the CSTO, it is not a security organization, 
and, unlike the CSTO, it is not dominated by Russia but 
serves as a mechanism for managing converging Russian and 
Chinese influence in the region.   Russian officials have 
repeatedly told us that the SCO will not have a military 
component beyond those needed for counter-narcotics and 
counter-terrorism cooperation, and that Moscow has no 
intention of turning the organization into an anti-Western 
counter alliance to NATO.  As discussions among Russia and 
its neighbors about regional coordination on transnational 
issues and on Afghanistan increasingly take place at the SCO, 
not engaging with the organization at the expense of 
cooperation on Afghanistan reinforces a Russian suspicion 
that the U.S. has no real intention of working with Moscow on 
issues of common concern.  Some level of U.S. participation 
in the planned SCO conference on Afghanistan may be a good 
first step in reversing the tendency to cast NATO, SCO, and 
Russia in a zero-sum light--again, if prior discussions have 
pointed toward more pragmatism in the Russian approach.  It 
would also open up an additional channel of communication 
with Russia and the Central Asian countries on best 
approaches to resolving the challenges we face in 



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Reference ID Created Released Classification Origin
09MOSCOW212 2009-01-30 07:44 2011-08-30 01:44 CONFIDENTIAL Embassy Moscow

DE RUEHMO #0212/01 0300744
P 300744Z JAN 09

C O N F I D E N T I A L SECTION 01 OF 02 MOSCOW 000212 
E.O. 12958: DECL: 01/29/2019 
Classified By: Political MC Alice G. Wells for reasons 1.4 (b) and (d). 
1.  (C) During the January 29 visit of Greek FM and OSCE CiO 
Bakoyannis to Moscow, Lavrov suggested Mevedev's proposed 
European Security Treaty (EST) be discussed at the Annual 
Security Review Conference (ASRC).  He proposed that the ASRC 
be held at the minister-level, and in Athens, instead of 
Vienna. The MFA told us that Russia would also pursue a 
second, independent track on the EST outside of the OSCE. 
Lavrov reiterated the GoR's call for an OSCE charter and a 
conference of Central Election Commissioners.  He contended 
that the security situation in Afghanistan did not permit 
OSCE programs to take place inside the country.  Lavrov 
expressed support for Bakoyannis's proposal to establish a 
partnership for Palestine within the OSCE.  Discussion of 
Georgia related-issues was reported reftel.  End summary. 
Initial CiO Visit to Moscow 
2.  (SBU) On January 28, MFA Deputy Director for the OSCE 
Alexei Polishuk briefed us on the recent visit of Greek 
Foreign Minister and OSCE CiO Dora Bakoyannis to Moscow on 
January 21.  During her visit, she met with FM Lavrov in two 
sessions -- bilateral and OSCE-related -- with the bulk of 
the conversation on OSCE issues related to Georgia (reftel). 
European Security Treaty 
3.  (C) Lavrov proposed that Medvedev's EST idea be discussed 
at the Annual Security Review Conference (ASRC), at the 
minister-level, and be held in Athens.  At the meeting, 
Bakoyannis said she would consider the idea, but Polishuk 
expressed his disappointment that subsequently Bakoyannis 
announced that the ASRC would take place in Vienna but with 
no mention of ministers.  Lavrov noted to Bakoyannis that 
Deputy Foreign Minister Grushko would travel to Vienna on 
February 19-20 to make a presentation on the proposal to the 
OSCE Parliamentary Assembly.  Despite the heavy emphasis 
Polishuk and Russian MFA press releases placed on this issue 
in reporting on the Lavrov-Bakoyannis meeting, Greek Embassy 
Counselor Dmitry Iannou told us January 26 that Lavrov only 
touched briefly on this topic with little engagement by 
4.  (C)  While admitting that there was little support for 
the European Security Treaty within the OSCE, as evidenced by 
the 2008 OSCE Ministerial, Polishuk told us that Russia would 
continue to pursue discussions.  He said Russia would now 
seek dialogue in two tracks -- the OSCE track and a separate 
and independent track that aimed for an open summit.  When 
asked if there was any umbrella under which these latter 
discussions would take place, he admitted "no...but perhaps 
we can create a group of friends to discuss the issues." 
Polishuk would not provide any details or speculate on 
participants, timing, or location. 
OSCE Reforms 
5.  (C)  During the meeting, Lavrov proposed that the CiO 
review Russia's 2007 proposals on an OSCE Charter and a 
conference of Central Election Commissioners.  Polishuk 
underlined to us that Russia had not changed its position: it 
wanted a legally binding charter as the "face" and 
"framework" of the organization.  When asked if Russia would 
consider something other than a charter, he conceded that 
Russia could consider limited political agreements that would 
establish procedures for member-states and partners, but 
would not give up its pursuit of a formal charter.  According 
to Iannou of the Greek Embassy, Bakoyannis told Lavrov that 
she was more interested in providing the OSCE with a 
"personality, not a charter." 
New Threats and Challenges 
6.  (C)  The MFA told us Lavrov said the security situation 
in Afghanistan did not permit OSCE programs to take place 
within the country.  Polishuk also reported that Lavrov and 
Bakoyannis agreed that the OSCE should be doing more to stem 
the flow of synthetic drugs from Western Europe and could 
better use public-private partnerships in countering 
terrorism -- both Russian initiatives. 
Middle-East Peace 
MOSCOW 00000212  002 OF 002 
7. (C) Polishuk told us Bakoyannis's proposal to establish a 
partnership for Palestine with the OSCE took the GoR by 
surprise, but Lavrov told Bakoyannis that Russia would 
support the idea. 



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Reference ID Created Released Classification Origin
09MOSCOW203 2009-01-29 15:02 2011-08-30 01:44 CONFIDENTIAL Embassy Moscow


DE RUEHMO #0203/01 0291502
P 291502Z JAN 09

C O N F I D E N T I A L MOSCOW 000203 
E.O. 12958: DECL: 01/28/2019 
Classified By: Ambassador John Beyrle, Reasons 1.4 (b/d). 
1.  (C) Summary.  In a January 28 meeting with the 
Ambassador, Finance Minister Aleksey Kudrin said the U.S. 
economy's recovery would be critical to a Russian economic 
recovery this year.  He said that policy coordination with 
the U.S. in particular and among G-20 countries in general 
would produce real benefits for the global economy and hence 
for Russia.  Kudrin noted that the Finance Ministry was 
following news and changes in the Obama administration's 
stimulus package "online:"  the GOR was revising its budget 
for 2009, and wanted to ensure that Russia's budget decisions 
coordinated with those of the U.S.  He said WTO membership 
remained a priority, but the GOR would need to show progress 
toward accession within the next six months or else more 
protectionist groups would win the day.  End Summary. 
U.S. Economy Key to Russia's Recovery 
2.  (C) The Ambassador told Finance Minister Aleksey Kudrin 
in a January 28 meeting that the new administration was 
developing policy themes and priorities that could shape the 
U.S.-Russia relationship in the coming years.  The Ambassador 
underscored that along with strategic issues, economic issues 
would be at the center of the bilateral dialogue going 
3.  (C) Kudrin welcomed the possibility of a renewed emphasis 
by the U.S. on bilateral economic ties.  He said U.S. policy 
decisions were of critical importance to Russia's economic 
prospects.  The world was economically interdependent, and 
Russia's economic recovery depended on events in other 
countries, above all the U.S.  No recovery in Russia would 
occur until the U.S. began to grow again. 
4.  (C) Kudrin said he and the Finance Ministry staff monitor 
developments in the U.S. related to the economic stimulus 
package "online" (i.e. in real time).  Kudrin demonstrated 
his familiarity with the stimulus package by sketching on a 
piece of paper its elements and their relative costs.  He 
also graphed how the proposed tax cuts in the package would 
increase the deficit initially before leading to a period of 
increased revenues in a few years.  Kudrin added that his 
staff also maintained regular contact with the Congressional 
Budget Office as a means of facilitating adjustments to the 
GOR's anti-crisis policies. 
5.  (C) Kudrin urged close coordination as the best means of 
emerging from the global downturn.  He hoped U.S. officials 
would outline their economic policy goals and make 
commitments on the steps to meet those goals.  For example, 
he observed that many countries, including Russia, were 
considering changes in financial market regulation.  Russia's 
economy would benefit from bilateral consultations with the 
U.S. to help guide the GOR's own decision-making process and 
ensure that they were fully coordinated. 
6.  (C) Kudrin said regular exchanges of views on financial 
issues and broader economic policies would also help counter 
domestic criticism of GOR policies, especially about the 
investment of Russia's foreign exchange reserves in U.S. 
securities.  He said greater policy coordination would also 
facilitate a shift in future G-20 agendas from issues of 
general interest toward more concrete objectives.  Kudrin 
implied he would raise this issue with Chancellor of the 
Exchequer Darling during his visit to London next week. 
Revising the Budget; Mitigating the Slowdown 
7.  (C) Underscoring his emphasis on coordination and full 
transparency, Kudrin spoke bluntly about his outlook for the 
Russian economy in 2009.  His forecast for GDP growth was 
negative 2 percent to 0 percent, which he acknowledged was 
more pessimistic than the 0 to 2 percent growth his recent 
public comments in China had indicated.  Kudrin added that 
the GOR was revising the federal budget for 2009 to mitigate 
the domestic downturn.  New realities, such as lower oil 
prices and a lower ruble/dollar, ruble/euro exchange rate, 
had spurred the initiative to adjust the original 2009 
budget.  (Note. Kudrin's Assistant, Vadim Grishin told us 
earlier in the week that MinFin had not agreed to the USD 41 
a barrel forecast for oil in the new budget, which it thought 
too optimistic.  End Note.) 
8.  (C) Kudrin said the Finance Ministry's main goal in the 
budget revision process would be optimizing expenditures. 
Controlling spending was the surest way to reduce inflation 
and mitigate the stagflation Russia was facing.  Kudrin said 
an increasing number of senior GOR officials recognized the 
need to reduce overall spending.  The Finance Ministry's goal 
was a 2-percent of GDP reduction in the
expenditures that the 
Duma had approved in the previous budget.  Without that 
overall reduction, he said, the federal budget deficit would 
range from 5-8 percent of GDP.  The Reserve Fund was large 
enough to cover a deficit of that size in 2009 but the GOR 
needed to preserve Reserve Fund resources because budget 
deficits were not likely to abate in the medium term; the 
deficit would likely be 4 to 5 percent of GDP in 2010 and 
would still be 3 percent in 2011. 
9.  (C) Kudrin said that although the GOR was working toward 
an overall spending cut, the new budget would contain 
additional expenditures related to the crisis.  The new line 
items were: RUB 380 billion (USD 11.5 billion) in pension 
support; RUB 300 billion (USD 9.1 billion) in transfers to 
the regions; RUB 90 billion (USD 2.7 billion) to index 
certain expenditures on inflation-sensitive areas of the 
budget; RUB 100 billion (USD 3 billion) in additional 
unemployment benefits; and RUB 300 billion (USD 9.1 billion) 
to recapitalize the banking sector.  This additional 
spending, Kudrin said, made it even more important to reduce 
spending elsewhere in the budget.  Kudrin said the process of 
revising expenditures was ongoing and that he expected the 
GOR would conduct a final review of the revised budget by 
mid-February before sending it to the Duma. 
10.  (C) Kudrin said that in addition to optimizing and 
targeting expenditures, the GOR was working to stimulate the 
economy in a variety of other ways.  One area of broad 
agreement within the GOR was funding banking sector 
recapitalization.  He said the GOR had directed banks 
receiving state funds to increase their credit portfolios by 
2 percent per month.  Kudrin explained that, in keeping with 
this instruction, the banks were to give priority 
consideration to the 500-600 firms the GOR (through DPM 
Shuvalov's anti-crisis commission) had identified as key 
recipients of support. 
WTO Membership Still Matters 
11.  (C) Kudrin said he, along with most other key Russian 
economic policy-makers, still favored Russia's WTO 
membership, which they believed would bring beneficial 
discipline to the Russian economy.  However, he warned that 
achieving demonstrable results in the next six months would 
be vital for the country's accession bid.  Lobbyists favoring 
a protectionist environment had already been busy opposing 
WTO accession and without significant progress, these 
lobbyists would become uncontrollable.  He suggested that a 
show of support from the U.S. would help fend off these 
lobbyists and speed up accession. 
12.  (C) Kudrin consistently has been our most transparent 
and realistic senior GOR interlocutor on economic issues.  He 
has also been the most forward-leaning in seeking economic 
cooperation with the U.S. and other western countries.  Prime 
Minister Putin's call in Davos for close international 
coordination to address the crisis and for a reliance on 
market solutions to the extent possible has the ring of 
Kudrin's influence, and thus should not be discounted as 
posturing.  Senior officials like Kudrin and First Deputy 
Prime Minister Shuvalov know that Russia's economic fate is 
linked with ours, and they are eager to work closely and 
cooperatively with the new administration to restore growth 
to the global economy.  We have a strong stake in showing our 
support for them, which strengthens their hand in the 
internal struggle with the protectionist, autarkic forces 
Kudrin cited in opposing WTO membership for Russia.  End 



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Reference ID Created Released Classification Origin
09MOSCOW201 2009-01-29 13:34 2011-08-30 01:44 CONFIDENTIAL Embassy Moscow


DE RUEHMO #0201/01 0291334
R 291334Z JAN 09

C O N F I D E N T I A L MOSCOW 000201 
E.O. 12958: DECL: 01/28/2019 
REF: 08 MOSCOW 3355 
Classified By: Political Minister-Counselor Alice G. Wells for reasons 
1.4 (b) and (d). 
1. (C) Summary: Right Cause, a new Kremlin-friendly party 
created in November, continues to suffer from internal rifts 
and an uncertain relationship with the Kremlin that has left 
the nominated head of its Moscow City branch -- Evgeniy 
Chichvarkin -- exiled in London.  Party leaders told us that 
the pro-business, ostensibly liberal party will target 
educated and entrepreneurial voters, with the intention of 
garnering between 8-15 percent of the vote in October 
elections.  Those same leaders acknowledged, however, that 
Right Cause will operate within Kremlin-defined space and 
will have no formal relations with non-Duma opposition 
movements.  Opinions differ whether the Chichvarkin saga 
resulted from a personal grudge or represents a message to 
politically-inclined Russian businessmen, but by any measure 
the case has exposed limits to the party's Kremlin patronage. 
 End summary. 
Party Expects Registration in March, Seeks Liberal Members 
--------------------------------------------- ------------- 
2. (C) The new pro-Kremlin Right Cause Party, formed in 
November 2008 from the ashes of three other parties (reftel), 
continues to suffer growing pains as it prepares to 
participate in October 2009 elections.  However, according to 
Right Cause co-chairman Leonid Gozman, the party submitted it 
registration paperwork on January 21 and will be approved by 
3. (C) Boris Nadezhdin, head of Right Cause's Moscow Region 
branch and a former member of the Union of Right Forces (SPS) 
Federal Political Council, told us January 23 that the party 
would target liberal-minded voters during its registration 
drives.  Nadezhdin calculated that by appealing to educated, 
pro-business, entrepreneurial, and politically-inclined 
voters, Right Cause would receive between 8-15 percent of the 
votes in the October elections.  (Note: Right Cause did not 
receive registration in time to submit party lists for the 
March 1 regional elections, which Gozman labeled a god-send 
since the leadership remained unprepared.  Instead, the party 
will run single-mandate candidates in a few March municipal 
elections.  End note.)  The party's strongest support, 
Nadezhdin predicted, would be in Moscow and St. Petersburg, 
but the party nonetheless would register in more than 40 
No Overlap With "Deep Opposition" 
4. (C) When pressed on how much Right Cause could oppose the 
ruling government, Nadezhdin admitted that he was "unsure how 
far we can push into the deep opposition," or even on what 
issues.  Improbably, Nadezhdin insisted that he joined the 
party only with the assurance that he could "say anything 
that I want to say."  Later, however, he acknowledged that a 
key motive for joining was that he tired of laboring in the 
political wilderness, and now looks forward to "the chance to 
have my face on television again."  Gozman and Nadezhdin both 
told us that Right Cause would not have any formal relations 
with the Solidarity opposition movement led by Garry 
Kasparov, among others; however, Nadezhdin detailed the close 
informal relationships that he maintains with Kasparov, Boris 
Nemtsov, and other opposition figures.  In this way, 
Nadezhdin said that he hopes to keep "feet in both worlds, in 
the Kremlin and in the deep opposition." 
Party Troubled By Internal Rifts 
5. (C) By Gozman's admission, Right Cause's biggest problem 
is intra-party feuding.  Stitched together in November from 
the remnants of the Democratic Party, Civil Force, and a rump 
faction of SPS, Right Cause has struggled to speak with a 
united voice outside of press conferences by party co-chairs 
Gozman, journalist Georgiy Bovt, and Delovaya Rossiya leader 
Boris Titov.  Gozman, still sporting an SPS lapel pin in our 
meeting, told us that problems are particularly nettlesome in 
the regions.  Nadezhdin explained that, in December, regional 
branches argued incessantly over whether former SPS or Civil 
Force members would lead them, and the party's national 
leadership was unable to solve the disagreements quickly or 
privately.  Partly as a result, Right Cause did not register 
branches in Kaliningrad, Perm, or the Jewish Autonomous 
Region.  To this day, the party lacks its own national 
website, continuing instead to use the SPS website and domain 
name.  Amid this internecine conflict, Nadezhdin boasted that 
he has been free to operate the Moscow Region branch 
relatively freely and without Kremlin supervision.  Indeed, 
he set up a separate website for his branch and hired his own 
press secretary. 
Chichvarkin Case Exposes Limits of Kremlin Protection 
--------------------------------------------- -------- 
6. (C) Since early January, the case of Evgeniy Chichvarkin 
has troubled Right Cause and exposed the limits to its 
Kremlin protection.  In S
eptember 2008, authorities 
questioned Chichvarkin -- the former head of Evroset mobile 
phone company -- in connection with the 2003 abduction and 
extortion of a Evroset exporter.  Also in September, under 
what Nadezhdin told us was strong pressure from security 
services, Chichvarkin sold his stake in Evroset to 
billionaire Aleksandr Mamut.  Despite increasing police 
pressure, Right Cause tapped Chichvarkin in November to head 
its Moscow City branch.  Nadezhdin explained that Chichvarkin 
"was seeking political protection by joining a party" that 
cooperates with the Kremlin.  On December 22, Chichvarkin 
fled to London, and on January 13 a Russian prosecutor 
charged him with kidnapping and extortion. 
7. (C) In public, party leaders proclaimed Chichvarkin's 
innocence, with Gozman telling a January 26 press conference 
that "his case is revenge for his success in business."  In 
response, Vice Premier Igor Shuvalov told press January 29 
that "there is no signal to Russian business."  In private 
meetings, however, party leaders revealed that Chichvarkin's 
situation stemmed instead from long-simmering rivalries with 
Kremlin factions.  Nadezhdin told us that Chichvarkin had 
made enemies with the security services, which Gozman 
confirmed included the Interior Ministry.  Explaining why 
Chichvarkin was given a prominent position in Right Cause 
given such hefty political baggage, Gozman explained that "he 
is in the party because he wanted to participate."  In any 
case, Gozman added, Kremlin Deputy Chief of Staff Vladislav 
Surkov, who masterminded the creation of Right Cause, 
approved Chichvarkin's proposed high-level participation. 
8. (C) The significance of Chichvarkin's case remains 
unclear.  According to Nadezhdin, it is intended primarily as 
a message to prospective Right Cause members that party 
membership has its limitations.  "There are forces taking 
sides against each other in the Kremlin," Nadezhdin confided, 
"against our people in the Kremlin."  Our people, he 
clarified, meant Surkov.  Gozman, on the other hand, observed 
that Chichvarkin's case was the result of making enemies with 
the security services.  In either case, siloviki forces in 
the Kremlin publicly constrained a visible participant of the 
so-called "Surkov Project" that created Right Cause. 
9. (SBU) Following a court's January 28 arrest in absentia of 
Chichvarkin, Gozman announced that Right Cause would soon 
nominate a new head of its Moscow City branch.  Potential 
replacements discussed in the media have included Mikhail 
Prokhorov, Aleksandr Mamut (to whom Chichvarkin sold his 
Evroset holdings), and Aleksandr Lebedev. (Note: Billionaire 
ex-KGB officer Aleksandr Lebedev told Nazavisimaya Gazeta on 
January 27 that he hopes to join Right Cause because "it is a 
chance to somehow participate in the Moscow City Duma 
elections," and "as a typical Menshevik, I believe it is 
necessary to cooperate with the authorities."  End note.) 
Vice Premier Shuvalov told Ekho Moskvy January 29 that it is 
possible there were "mistakes by authorities," leaving open 
the possibility that Chichvarkin's case could be reversed. 
10. (C) According to Gozman, Surkov personally approved 
Chichvarkin's participation in Right Cause, indicating that 
Surkov's protection inside the Kremlin has limits, 
particularly when up against siloviki security service 
elements.  The message to prospective Right Cause members is 
clear: political opposition, even in a pro-Kremlin party, 
comes with circumscribed boundaries.  Right Cause undoubtedly 
will receive its party registration, and by all observers' 
accounts will win seats in regional elections across Russia 
in October.  The party will play by defined rules, however, 
which will cordon it well away from anything resembling 
authentic or "deep" opposition. 



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Reference ID Created Released Classification Origin
09MOSCOW199 2009-01-29 08:38 2011-08-30 01:44 CONFIDENTIAL Embassy Moscow

DE RUEHMO #0199/01 0290838
P 290838Z JAN 09

C O N F I D E N T I A L SECTION 01 OF 03 MOSCOW 000199 
E.O. 12958: DECL: 01/28/2018 
REF: A. 08 MOSCOW 3591 
     B. 08 MOSCOW 3380 
     C. 08 MOSCOW 2053 
Classified By: Ambassador John R. Beyrle for Reasons 1.4 (b/d) 
1. (SBU) Transneft President Nikolai Tokarev told the 
Ambassador January 27 the company is moving forward on its 
various major pipeline projects as "they are needed to handle 
new oil supplies" and "because the government has directed 
them."  Tokarev said the company is getting the funding it 
needs for the projects largely from state-owned banks, but 
complained about banks being tight with financing.  He blamed 
the reduction of oil supplies to the Czech Republic in July 
(ref C) on non-transparent oil trading companies (ref B). 
Tokarev's descriptions of Transneft's projects reinforce the 
company's reputation as a politically-driven, uneconomical 
Russian state-owned enterprise.  End summary. 
--------------------------------------------- --- 
--------------------------------------------- --- 
2. (SBU) Tokarev told the Ambassador in a January 27 meeting 
that the 100% government-owned company controls 50 thousand 
kms of oil pipelines, and, with its recent acquisition of 
Transnefteprodukt, another 20 thousand kms of oil product 
pipelines.  Tokarev said the company has four main pipeline 
projects under development:  the East Siberia-Pacific Ocean 
(ESPO) pipeline, the Baltic Pipeline System 2 (BPS2), the 
Burgas-Alexandropoulis pipeline (BAP), and the Caspian 
Pipeline Consortium (CPC) pipeline. 
3. (SBU) Tokarev said the first phase of the company's most 
ambitious project, the ESPO, should be completed by December 
2009.  He said, however, progress has been hampered by 
difficult conditions, including warmer-than-usual winters 
that result in swampy terrain.  The 2,700 km first phase, 
which will reportedly cost $14 billion or more when complete, 
is designed to carry Russian crude to China.  Tokarev said 
phase 2 of the project, a 2,100 km extension to the Pacific 
Ocean, is planned for completion in 2013. 
4. (SBU) Responding to the Ambassador's suggestion that some 
analysts indicate there won't be enough oil to justify phase 
2, Tokarev claimed the company already has commitments from 
Rosneft, Surgutneftegaz, and TNK-BP, to fill phase 2.  He 
specifically pointed to 62 million tons (mt) of new supplies 
coming online in the next few years as the source of future 
supplies for ESPO.  However, Tokarev left open the 
possibility that phase 2 could be delayed, acknowledging that 
future supplies can be hard to predict and that many oil 
companies are shutting down and delaying projects due to the 
plunge in oil prices and the financial crisis.  (Note:  In 
addition, new supplies will, at best, replace declining 
production from older fields.  End note.) 
5. (SBU) Tokarev used the same 62 mt in new supplies to 
justify the need for BPS2.  He said the GOR recently approved 
the company's plans to build the pipeline (which some 
analysts estimate could cost $5 billion or more).  The 
project is designed to bypass transit states and deliver oil 
directly to Russian port of Ust-Luga (near St. Petersburg) on 
the Baltic sea, from which it would be shipped by tanker. 
Tokarev pointed to potential problems with Ukraine as a 
transit state (technical complications related to flows along 
the Odessa-Brody pipeline, the recent gas crisis, Ukraine's 
"unreliability" as a partner) as further justification for 
6. (SBU) Tokarev said that Russian and Kazakh officials are 
engaged in ongoing negotiations to bring more Kazakh oil to 
Russia for export to other markets, including through ESPO 
and BPS2.  He emphasized Russia's need and desire for 
"alternatives" in its export routes.  When pressed on the 
issue of whether BPS2 would be economically justified if 
relations with Ukraine were not an issue, Tokarev said the 
MOSCOW 00000199  002 OF 003 
pipeline will be built because the government has so 
7. (SBU) Tokarev also justified the BAP project, noting that 
with the Bosporous straits woefully congested -- "all tankers 
other than U.S. ones are delayed at least 3 days" -- a bypass 
was needed.  According to Tokarev, "concrete" work on BAP 
construction would begin this year with feasibility studies 
already contracted to a German firm.  He said BAP has been on 
the drawing board for a decade and does not depend on CPC 
expansion (ref
A).  Tokarev added, however, that "if" CPC 
expansion moves forward, BAP could use CPC crude.  Quickly 
qualifying his use of the word "if," Tokarev said he sees "no 
problems" with CPC expansion, but that "details" are still 
being worked out. 
8. (SBU) Tokarev said Transneft's projects enjoy government 
support, given their immediate job-creating effects.  He 
claimed that despite a tough environment in the credit 
markets, the company had arranged financing for all of its 
planned capital expenditures in 2009, largely through 
state-owned banks (i.e. Sberbank, VTB, etc.).  Tokarev, 
however, complained that banks have been tight with credit. 
He added that the Ministry of Finance is reviewing 
Transneft's financing needs with regard to BPS2, though he 
was sure it would approve the funding.  Tokarev said 
Transneft is also seeking financing by issuing 3-5 year 
notes, but admitted that the success of financing options is 
difficult to predict in the current environment. 
9. (SBU) In response to the Ambassador's query, Tokarev 
blamed the summer reductions of oil supply to the Czech 
Republic (ref C) on an oil trading intermediary of unknown 
off-shore ownership.  According to Tokarev, refineries in the 
Czech Republic do not have contracts with Transneft nor with 
Russian oil producers but with oil trading companies (ref B) 
who were responsible for the diversion of oil supplies.  He 
claimed that Transneft had fulfilled all its oil transport 
obligations.  Tokarev added that Transneft is in talks with 
its Czech counterpart, Mero, on the creation of a joint 
company to handle the oil trade between Russia and the Czech 
Republic, eliminating other oil trading intermediaries. 
10. (C) According to various press reports, Tokarev, whose 
official bio is blank from 1973 to 1999, is a close friend of 
PM Putin.  He was reportedly Putin's boss in the KGB in East 
Germany in the 1980s.  He reportedly has a similar link to 
Gennady Timchenko, owner of secretive oil trading company 
Gunvor (ref B), whose firm controls much of the pipeline 
trade out of Russia.  He was flanked in the meeting by his 
Deputy, Mikhail Barkov, and his International Affairs 
Advisor, Oleg Pillipets, both security service alumni. 
11. (C) Transneft is a prime example of Russia's failed 
economic model of state-owned "national champions."  It is 
run not by a businessman with industry experience, but by a 
political insider with an intel background.  Many Transneft 
projects -- including BPS2, ESPO phase 2, and even ESPO phase 
1 -- are driven not by economic fundamentals, but by the 
state's overarching geopolitical goals.  The projects are 
thus not financed by the markets, but, by Tokarev's own 
admission, by state-owned banks at the government's 
direction.  Given its monopoly status, there is no doubt 
Transneft will continue to play a vital role in delivering 
Russian crude to markets.  However, its services are more 
MOSCOW 00000199  003 OF 003 
likely a drain on the Russian economy than a contributor to 



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Reference ID Created Released Classification Origin
09MOSCOW198 2009-01-28 16:16 2011-08-30 01:44 CONFIDENTIAL Embassy Moscow

DE RUEHMO #0198 0281616
P 281616Z JAN 09

C O N F I D E N T I A L MOSCOW 000198 
E.O. 12958: DECL: 01/28/2019 
Classified By: Political MC Alice G. Wells for reasons 1.4 (b) and (d). 
1.  (C) The MFA told us January 28 that Russia had rejected 
the Greek proposal on "legal" grounds but stated that Russia 
would be ready to accept two equal-ranked mission offices 
(one in Georgia and one in South Ossetia) that reported to a 
"chapeau" organization in Vienna, but not one that reports 
directly to the CiO.  Claiming that such a structure would 
violate the roles and responsibilities of the CiO, the GoR is 
open to a task force or similar organization under the 
Conflict Prevention Center.  Russia is not in a hurry to 
renew the mandate for the mission in Georgia and will reject 
any mandate which authorizes monitors to operate in South 
Ossetia.  The GoR will consider a technical roll-over of the 
twenty existing monitors in Georgia proper.  End summary. 
Georgia OSCE Mission Mandate 
2.  (C) On a January 28, Russian MFA Deputy Director for OSCE 
Alexei Polishuk briefed us on the recent visit of Greek 
Foreign Minister and OSCE CiO Dora Bakoyannis to Moscow on 
January 21 (more on visit of Bakoyannis septel).  Polishuk 
told us that Russia only agreed to a "chapeau" organization 
in Vienna and to missions to South Ossetia and Georgia, but 
rejected that the missions or the coordinating office would 
report directly to the CiO.  In the ministry's view, any such 
arrangement would violate Decision 8 of 2002, which outlines 
the CiO's functions.  The GoR would also reject any proposal 
where Georgia would receive a full mission and South Ossetia 
would only host a support or subordinate organization -- 
"they must be equal."  That said, Polishuk told us that 
Russia would support both organizations reporting to a task 
force or similar body that reported to the Conflict 
Prevention Center (CPC), but objected to the vague language 
that the Stability and Security Office (SSO) would only be 
housed in the CPC but report to the CiO. 
3.  (C) The GoR also continues to hold to its red line that 
it will not accept monitors in South Ossetia.  Polishuk 
rejected any discussion on a definition of a zone of conflict 
or area of operations for military monitors as a route for 
compromise.  Instead, he recalled the situation after World 
War II, when the U.S., UK, France, and Russia had forces in 
Germany and Austria, but not in the U.S. or the USSR.  In 
addition, he repeated the standard line that Russia would not 
be able to get the South Ossetians to agree.  While conceding 
that it would be useful for the OSCE monitors to obtain South 
Ossetian and Russian views when reporting on incidents over 
the administrative boundary, he said that such reports "are 
not within the mission's mandate." 
4.  (C) Polishuk underlined that Russia was "in no hurry to 
renew the mission's mandate" to Georgia.  He said that the 
MFA would support a technical roll-over for the twenty 
monitors in Georgia proper "who are responsible for 
monitoring implementation of the Medvedev-Sarkozy agreement," 
but that it would not support renewal of the office in Tblisi 
as it is currently proposed.  He allowed that Russia might 
reconsider its position on the Georgia mission, if a 
framework could be established for the organization's 
reporting mechanisms to Vienna. 
5.  (C) The Ambassador will have an opportunity this week to 
push DFM Karasin on the hard-line stance presented by the MFA 
working level, which was clearly intent on underscoring to us 
Russia's willingness to nix an acceptable compromise. 



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Reference ID Created Released Classification Origin
09MOSCOW197 2009-01-28 16:15 2011-08-30 01:44 UNCLASSIFIED Embassy Moscow

DE RUEHMO #0197/01 0281615
R 281615Z JAN 09

E.O. 12958: N/A 
1. (SBU)  Summary.  Leaders of the Russian Orthodox Church 
(ROC) gathered on January 27 at Moscow's Cathedral of Christ 
the Savior to elect Acting Patriarch Metropolitan Kirill as 
the Church's 16th Patriarch.  Seventy-two percent of 
delegates picked Kirill, who deftly used his position and the 
media during the race to prevail over his sole competitor 
Metropolitan Kliment.  World religious leaders and Russian 
government officials congratulated Kirill, with particular 
praise coming from the Vatican against the backdrop of 
improving Roman Catholic Church (RCC) and Russian Orthodox 
Church relations.  The election, the first religious event 
widely broadcast throughout Russia, drew vast media 
attention, but also a few protesters, and an alleged 
temporary closing of a separatist church website.  Pundits 
debated the future course of the ROC under the new Patriarch, 
naming reconciliation with the RCC and unity with the 
Ukrainian Orthodox Church as his top priorities, and 
questioning to what degree would the ROC cooperate with the 
Kremlin.  End Summary. 
Charismatic Over Conservative 
2. (SBU)  In a landslide victory on January 27, the Local 
Council of the ROC chose the charismatic and liberal 
Metropolitan Kirill over conservative Metropolitan Kliment as 
the 16th Russian Patriarch, positioning the Church for 
greater engagement domestically and abroad.  The voting 
lasted approximately four hours, culminating in an 
announcement at 2200 in the main hall of Christ the Savior 
Church, temporarily provisioned with voting booths for the 
occasion.  The Acting Patriarch (Locum Tenens) Kirill drew 
support from 72 percent of the delegates, receiving 508 of 
the 702 votes cast at Christ the Savior Cathedral in central 
Moscow.  Kirill's sole competitor on the ballot, the 
conservative Metropolitan Kliment of Kaluga and Borovsk, 
tallied only 169 votes, or 24 percent.  Election 
administrators declared another 23 ballots invalid.  Kirill 
and Kliment were the only two candidates because the third 
candidate selected by the Bishops' Council on January 25, 
Metropolitan Filaret of Minsk and Slutsk, withdrew from the 
race just hours ahead of the final vote and encouraged his 
supporters to vote for Kirill.  Although ROC rules allowed 
for the possible introduction of a fourth candidate on the 
ballot, should that person receive the support of 50 percent 
of the Local Council, no other contenders challenged Kirill 
or Kliment. 
3. (SBU)  Even though most theologians and media outlets 
listed Kirill as the frontrunner, none expected the margin of 
victory to be so wide.  While Kirill received 72 percent of 
the final vote in the Local Council, he pulled in only 49 
percent of the ballots during the earlier Bishops' Council 
(reftel), a likely consequence of many bishops voting in 
favor of their local hierarchs.  Several journalists 
commented that Kirill completely outplayed Kliment in the 
media sphere, skillfully utilizing his role as Acting 
Patriarch to hold widely-broadcast holiday religious 
services, ecumenical seminars, and press conferences in the 
run-up to the election.  A January 28 Kommersant article 
pointed to the early elections, held only seven weeks after 
Aleksey's death, as an advantage for Kirill in that it 
prevented any serious competitor from launching a 
full-fledged informational campaign to counter him.  Other 
analysts attributed Kirill's victory, in part, to 
Metropolitan Vladimir of Kyiv and All Ukraine's decision to 
withdraw from the race, ultimately fracturing the otherwise 
united support of the Ukrainian delegation and strengthening 
Metropolitan Kirill's support base, according to a January 19 
Kommersant article. 
Vatican "Rejoices" Over News of Kirill 
4. (SBU)  While many religious and human rights officials 
provided conservative well wishes to Kirill after his 
election, a Roman Catholic Church (RCC) spokesman said the 
Vatican "rejoiced" over the news.  Vatican spokesman in 
Moscow Rev. Federico Lombardi said Kirill was "esteemed in 
the Vatican," and hoped his service would deepen the level of 
collaboration and understanding between the churches, 
according to the Associated Press.  Other religious leaders 
offered their congratulations, including Chief Rabbi of 
Moscow Beryl Lazar, who expressed appreciation for Kirill's 
work at the inter-religious council.  Head of Russian 
Buddhists Pandito Hambo Lama Damba Ayusheyev praised the 
ROC's selection, saying that Kirill "will contribute to the 
further development of tolerance in Russian society."  Human 
rights activist Lyudmilya Alekseyeva took a different tack, 
telling Interfax news agency that the ROC should "instill 
MOSCOW 00000197  002 OF 003 
serenity and tolerance in its congregation," while hoping 
that the Church would remain separate from the state. 
5. (SBU)  Both Medvedev and Putin called Kirill to offer him 
their best wishes, noting
 the importance of the ROC to the 
state.  Medvedev sent a statement to the Local Council, 
saying that he hoped Kirill would "further develop the 
fruitful cooperation of the Russian Orthodox Church and the 
state."  For his part, Kirill remarked in previous weeks that 
church-state relations should be founded on "mutual 
non-interference in each other's affairs," suggesting the 
possibility that friction existed in their outlooks.  Russian 
news daily Gazeta suggested on January 28 that Kirill had 
grown closer to both Medvedev and Putin in recent months, 
while suggesting that the defeated Kliment would probably 
find a new role with government support, possibly with 
support from First Lady Svetlana Medvedeva.  Levada Center's 
Boris Dubin noted to us on January 28 that the state cannot 
afford to ignore the church, as it was one of three 
institutions (the others being the president and the army) 
that people trusted, especially since the new patriarch will 
lead 165 million believers worldwide (approximately 100 
million of whom are in Russia) from 157 dioceses in over 60 
Nashi Supporters Prevent Protests 
6. (SBU) Between 200 and 300 people, including members of 
Kremlin-backed youth group Nashi's Orthodox Corps, gathered 
near Christ the Savior Cathedral on the morning of the 
Bishops' Council to deter anti-ROC protests.  Nashi's 
Orthodox Corps, led by Boris Yakimenko, waved supportive 
banners and placards outside the church and the nearby 
Friedrich Engels monument, with slogans reading "May the Holy 
Spirit Point to a Worthy Man" and "We are for a United 
Church."  Director of the Moscow branch of the Union of 
Orthodox Citizens Kirill Frolov added that "our goal is to 
demonstrate that the smear campaign against Metropolitan 
Kirill is a campaign against the ROC."  Approximately 30 
supporters of defrocked Bishop Diomid of Chukhotka, described 
by Interfax news agency as "belligerent women in headscarves 
and ragged men with beards", quarreled with police near the 
entrance to the church without incident.  Moscow Police Chief 
Vladimir Pronin reported that 12,000 law enforcement officers 
would be involved in election and enthronement proceedings 
until February 3, with over 250 officers set to guard local 
churches from attacks by vandals or youth opposed to Church 
Wide Media Coverage, With Exceptions 
7. (SBU)  Several Russian media outlets provided live news 
coverage of the Patriarchal election procedure, including 
leading television broadcasters Channel One, Rossiya, and 
Vesti as well as radio stations Voice of Russia and Radio 
Rossiyi.  The new Orthodox television station Spas (Savior) 
also covered the Local Council meeting, using footage from 
Vesti news channel.  With the rise of importance of Russian 
Orthodoxy in the country, so too the number of Russian 
Orthodox media outlets has risen.  Approximately 3,500 
Russian Orthodox blogs and hundreds of newspapers and 
magazines covered the Moscow Patriarchate's activity in 2008. 
 The most successful Orthodox magazine, according to a 
December 25 New York Times article, has been "Foma," with a 
staff of 30 and a monthly budget of over USD 100,000, run by 
its Chief Editor Vladimir Legoyda.  Financed by sponsors and 
some advertising, the article noted that Foma's usual print 
run of 30,000 exceeded that of the official ROC newspaper 
Tserkovny Vesnik, which routinely printed 20,000 copies. 
8. (SBU) Religious analysis website 
Deputy Chief Editor Vladimir Oyvin told us that special 
services blocked access to his website on the eve of the 
Bishops' Council "at the request of the Russian Orthodox 
Church."  He added that authorities restricted access to the 
official website of the Russian Orthodox Autonomous Church 
(ROAC), the home page for a forum of supporters for Bishop 
Diomid.  The Credo portal, known for providing critical 
commentary of the Moscow Patriarchate, last faced a shutdown 
during the Kyiv celebrations surrounding 1020th Anniversary 
of the Baptism of Holy Rus in July 2008.  Deacon Kurayev 
labeled the Credo portal an "anti-Kirill" site, perhaps 
suggesting that Kirill supporters leaned on officials in 
order to block it. 
The Future ROC 
9. (SBU)  Charting the Church's future course featured 
prominently in media debate prior to the election, especially 
MOSCOW 00000197  003 OF 003 
with regard to the ROC's possible reconciliation with the 
Roman Catholic Church (RCC) after the Christian schism of 
1054 that separated Christianity into Eastern and Western 
branches.  While Kirill's meeting with Pope Benedict XVI in 
the Vatican on December 2007, as the head of the ROC's 
foreign ministry equivalent, represented growing clergy 
interest in finding a common ground with the RCC, 
Patriarch-elect Kirill clarified on January 27 that he would 
not meet the Pope unless tensions between the faiths are 
resolved.  The main sticking point in discussions between the 
Vatican and Russian Orthodox officials remained the ROC's 
complaint that the RCC continued its attempts to convert 
Orthodox believers to Catholicism on the ROC's traditional 
territory.  Deacon and theologian Andrey Kurayev commented to 
Kommersant on January 28 that the Ukrainian Orthodox Church 
(UOC) stood as the biggest challenge for the Moscow 
Patriarchate, namely because of dual pressure from 
Constantinople and President Yushenko to move the UOC under 
Constantinople's authority.  The UOC also faced a separatist 
element inside the UOC itself, which hopes to move out from 
under the Moscow Patriarchate's authority.  UOC delegate to 
the Local Council Archimandrite Antony called on Kirill to 
unite the ROC on January 27, in hopes that all could overcome 
a potential split.  Kirill also needs to turn his attention 
homeward, as 69% of Russians could not name him in a January 
22 VTsIOM poll. 
10. (SBU)  The current economic crisis and demographic 
quagmire in Russia will absorb much of Kirill's energy, 
drawing his attention away from past ecumenical tasks abroad. 
 While his intelligence and charisma represent beacons to 
attract Orthodox believers in a declining Russian population, 
the Church seems ill-equipped to appeal significantly to 
youth accustomed to the consumer lifestyle he condemns as a 
"Western" affront on Christianity.  Kirill's complaints that 
courses teaching the fundamental principles of Russian 
Orthodoxy have stalled, and that legal foundations for the 
work of clergy in the military have not developed quickly 
enough, indicate his ambition to push religion into core 
state functions.  Whether Kirill's independent spirit and 
penchant for separation of church-state functions will openly 
collide with a Kremlin accustomed to Church subservience 
remains an issue that we will continue to follow closely.