Russia on the Ground – September, 2017

Russia on the Ground
September, 2017

RASP-BlueThis resource serves to track domestic news inside Russia – focusing primarily on demographics, public opinion, economy, and major domestic political events inside Russia.

It is intended to give students who are otherwise following major issues and events within Russia greater context from which to view those issues and events. This resource lists useful but often under-reported information that can help build a pragmatic and objective view of Russia’s domestic situation.


Public Opinion

Russian Support for Reform Lagging (article in Russian)
28% of Russians disapprove of reform, especially those 45 to 60, lower-income, and/or living in mid-sized cities. 70% support reform, but two thirds of supporters support “top-down” reforms, rather than “bottom-up.” Article in Russian – poll conducted by a liberal Russian think tank.

Most Russians Dislike the Idea of Moving to the Capital
An overwhelming majority of Russians who live outside of Moscow told researchers that they would prefer not to move to the capital, and over half of them described Moscow as “just a big city.”

Almost Half of Russians Want to End Military Operation in Syria
Only a third of respondents said that strikes on terrorists ought to be continued.

Poll Shows Most Russians Confident Authorities Can Shield Them from Terrorism
According to the survey, today the population’s fears associated with a terrorist threat are lower than last spring.



Another Worrying Sign for Russia’s Dire Demographics
In the 1990’s, Russia suffered demographic losses (low birth rates, high emigration, and high death rates) losses at a level you usually only see under full-scale war. Today, the 90’s generation is coming of age – meaning fewer people entering the workforce and fewer people to have babies. As in most countries of Europe and North America, Russian birthrates are not replacing the native population; they are resulting in slow, natural decline. In Russia, though, this is more pronounced because the generation now entering child-bearing years is so small. Though more pronounced, the problem is not insurmountable. Russia already attracts more immigrants than any other country on Earth save the United States. This has actually helped Russia achieve overall growth in recent years, despite the natural decline. In the coming years, Russia will need more immigrants and increased labor efficiency. To achieve this, it has to accomplish the not-easy tasks of investing of labor (education), investing in mechanization, and, of course, investing in tolerance to support increased immigration. Again, what Russia is experiencing is a global trend – but far more pronounced due to historical factors. As the world is becoming more interconnected with a more mobile population, this will result in economies being able to more easily compensate for labor shortages or to compete more fiercely for top talent.

Mortality From All Main Causes of Death on Decline in Russia
Deaths from cardiovascular diseases dropped by 3.3%, from oncology – by 2.8%, from tuberculosis – by 15.2%.

The Caring State: How Russia’s New Babushkas Are Filling in the Welfare Gaps
Expectations of babushki taking care of their grandchildren, shaped by the Soviet history of family and economic policies, are hard to implement in a radically different post-socialist context.

Number of Russians Doing Charity Work Up by About 20 Percent in Past 10 Years
The number of Russians engaging in charitable giving has increased to 69% in 2017 from 50% ten years ago, according to opinion poll results released by the Russian Public Opinion Research Center (VCIOM).

Aeroflot Gender Discrimination Case Reaches Court in Moscow
Two Aeroflot flight attendants are to have their gender discrimination claims against the airline heard in court in Moscow this week in the first case of its kind to involve a major, state-controlled Russian company.

Why Myanmar Has Inflamed the Russian Caucasus
Chechnya’s “special status” and “national distinctness” render Russia, a multi-ethnic and multi-faith country, with an opportunity to carry out its foreign policy through channels other than its Foreign Ministry.

Russky Standart Group’s Profits Soar as Illegal Vodka Production Eradicated
A fascinating, short article that covers both the birth of retail banking and regulated vodka production in Russia.


Internship in RussiaEconomy

Frigid, Industrial Siberia: Primed for the Digital Era
As Russia rapidly digitizes, data infrastructure must expand to support digital growth. One company has figured out how to harness Irkutsk’s renewable resources of a cold Siberian climate and a powerful river to keep equipment that runs hot continuously cool.

Russia’s Mobile Economy at 4% of GDP to Outgrow Agriculture, Insurance
The mobile economy is defined in the report as all services based on mobile telephony and mobile data, including traditional telecom services, applications, and online commerce.

Russian Consumer Statistics Continue to Improve with Incomes Up, Unemployment Down
Russia can be said to be out of the crisis but not yet clearly onto a long-term path to sustainable recovery.

Russian Arms Dealers Push for Global Dominance
CNN on Russian helicopters – which are in demand for the same reason that Kalashnikovs and old Ladas are still respected – they are not the most advanced technology, but they are easy to run, fix, and can “take a beating and keep on ticking” as the saying goes.

Polyus Launches Giant New Mine in Russia’s Far East
Russia is catching up to China to become the world’s largest producer of gold.

Volkswagen Doubles Exports of Russia-Made Cars
While the number is still low, the trend is likely to continue.

Despite New US Sanctions, Russian Oil Traders Say It’s Business as Usual
Initiated by Congress, the sanctions were in part designed to punish Moscow further for its 2014 annexation of Ukraine’s Crimea peninsula and to sanction it for what U.S. intelligence agencies say was its meddling in the U.S. presidential election, something Russia denies.

Russian Airline VIM-AVIA Heads for Receivership
Transport Minister Maksim Sokolov said on Tuesday propping up the failing carrier was not economically sound.



Russia Is an Emerging Superpower in Global Food Supply
More accurately – Russia is RE-emerging as a food superpower. Under the Tsars, grain funded the state coffers similarly to the way oil does today. Logically, a country with vast stores of land and sparse population density should have plenty of room to develop agriculture. It’s taken quite a while, though, for Russia to get its land code and agriculture policy in order for agriculture to start to make a comeback after its post-Soviet collapse. Russia still has massive room to improve yields and quality – but will need further reform and, just as important, more transport, storage, and processing infrastructure.

Russia Is Exporting More Food Than Tanks, But Not All Farmers Are Happy
The fall in the ruble’s value and boosted support and protection of domestic production are resulting in jumps in Russia’s export potential for the world food market.

The Return of the Eurasian Breadbasket
According to the latest estimates, Russia might harvest as much as 133 million tons of gain this year. This would make 2017 a record harvest not just by post-Soviet standards, which were pretty dismal until the past decade, but relative to the RSFSR’s peak of 127.4mn tons in 1978.

Russia Expands Grip on Wheat Exports as Asia Set to Buy More
This season, Australian production will plunge the most in a decade, American farmers will have their smallest harvest since 2002, and Canada’s crop will shrink for the third time in four years.

Russian Agriculture Thrives as Sanctions Close off Imports
Last year Russia overtook the US in wheat exports for the first time for decades, and is expected to dethrone the EU as the world’s largest exporter this year, according to the US Department of Agriculture.

Russia Destroys 17,600 Tonnes of Embargo-Busting Produce Since August 2015
In the two years or so that the destruction order has been in effect, 17,893 tonnes of embargoed products have been seized, including 17,281 tonnes of plant and 612 tonnes of livestock products.


Policy and Conflict Post SovietBanking and Investment

Only a Quarter of Russians Keep their Savings in Banks
That is slightly down from 2013 when 28% of Russians used banks to hold their savings. At the same time 73% of Russians reported they have no savings at all, up from 71% in 2013.

Otkritie, a Bank too Big to Fail
Although Otkitie was named a “systematically important” financial institution, the bank suffers from a lack of capital, low quality of assets and massive deposits withdrawl.

Russia’s Otkritie Collapse: The Owners and the Details
Otkritie played several roles. It is a real banking business with the second largest commercial bank deposit base and an active player on the securities market, but it also a convenient home for rich people’s money.

B&N Bank Rescued by Russia’s Central Bank
Russia’s central bank has been forced to rescue two major lenders in less than a month, intensifying concerns among global investors that a systemic banking crisis could be in the offing.

What Jolted Russia’s Investments Is About to Fizzle Out
Russia’s economy is emerging from its longest recession this century, prompted by a drop in oil prices and international sanctions imposed after the Crimea annexation weakened the ruble and sparked capital outflows.

Central Bank Analysts Lower Russian GDP Growth Forecast in Q3-Q4 on Weak Industrial Production Data
According to Rosstat data, Russian GDP growth in Q2 2017 accelerated to 2.5% in annual terms, after growing 0.5% in Q1. This was the highest growth the economy had seen in annual terms since 2013, the analysts said.

Russia’s CBR Expected to Cut Rate, Refine Guidance
The CBR governor Elvira Nabiullina on September 8 said that she sees room to cut the key rate, but still sees inflationary risks lingering.

Sanctions Therapy?
Sanctions are effectively remodeling Russia’s financial relations within the country at the same time as it redraws its financial links with the outside world.

Russia’s CBR Gets Tough on Banks, Demands They Reveal Owners’ Identities
Currently banks in Russia only need to disclose their ownership structure.



Russia to Spend $2.5bln on Trans-Siberian, Baikal-Amur Railroads
There is an enormous volume of freight flowing between the Asia-Pacific countries and Europe. Only a tenth of this volume passes through Russia. The expansion hopes to capture more.

Russia’s Bridge Link with Crimea Moves Nearer to Completion
Crimea is linked to Ukraine by a narrow isthmus, but is separated from Russia by the Kerch Strait. Currently the only routes to Crimea from mainland Russia are by plane or a ferry across the strait, which is often cancelled due to bad weather.

Little Cash For Russia’s New Arctic Development Program
Ambitions are sky-high, but much hinges on private investments.

Russia Offers a Bridge Across History to Connect Tokyo to the Trans-Siberian Railway
Would you ride a train from London to Tokyo? The proposed railway would allow epic journeys from London to Tokyo with major international crossing between Sakhalin and Hokkaido.


Regional Elections; Opposition Wins

The Active Minority and Passive Majority: Takeaways from Russia’s Regional Elections
Russia’s recent regional and municipal elections saw an increase in voting by the reform-minded minority and a decrease in voter turnout among Putin’s former majority. However, the Kremlin chooses to ignore these trends, turning a blind eye to the possibility that the active minority and the discontented passive majority may eventually meet.

How a Small Russian Election Inspired a Big Political Movement
“No Putinists, Stalinists or supporters of the annexation of Crimea,” campaign chief Anna Kuznetsova warns. “And maybe also not those who oppose paid parking,” she adds as an afterthought.

In Moscow, Putin’s Opponents Chalk up a Symbolic Victory
Russia’s liberal opposition is on a high after achieving a series of unprecedented victories in the Kremlin’s backyard at local council elections — including in the wealthy Moscow district where Vladimir Putin cast his own ballot.

Recapping Sunday’s Elections: United Russia Sweeps Gubernatorial Races, While ‘United Democrats’ Break Through in Moscow
In six regions, Russians elected new parliaments, and there were special elections in the Leningrad and Bryansk regions for single-mandate seats in the federal State Duma vacated by deputies who resigned their office.


Internship in RussiaOther Domestic Politics

Flash Mobs, Memes & Selfies: Election Commission Aims to Boost Voter Turnout
So far, only three politicians have openly announced that they intend to run for the presidency.

Greasing the Public’s Hands: How Oil and Gas Taxes Financed the Kremlin’s Social Contract
Why is so much of Russia’s budget revenue derived from oil and gas (about 35% right now)? It’s actually been a focused strategy to keep the government funded while simplifying the tax code, lowering the taxation burden felt by the public, and boosting public goods and services.

Russia’s New Anti-Doping Chief Looks for a Fresh Start
Following WADA’s suspension of RUSADA’s credentials, athletes were left adrift as the athletic and Paralympic federations across Russia were also suspended; moreover, their careers hung in the balance or were simply destroyed. As the 2018 Olympics grow closer, the re-installment of RUSADA as a legitimate agency is critical to providing Russian athletes with a secure place in global competitions.

Beslan Siege: Russia “Will Comply” with Critical Ruling
A ruling has finally come down from the European Court of Human Rights after a long case and a rejected appeal. They have ruled that Russia used disproportionate force in ending the Beslan Siege.

Kremlin Leadership Politics: No Longer ‘Bulldogs Fighting Under a Rug?’
The Russian political elite comprises a chaotic mixture of clans and players pursuing often conflicting aims and aching to protect their power, status and property by correctly interpreting the signals from those higher up the ladder, even as they fear taking an inadvertent misstep.

Upper House Gives Legal Definition to Foreign Interference in Russia’s Affairs
This definition will become a starting point in developing the future “law on undesirable behavior” – an act detailing the procedure of expulsion of foreigners involved in attempts to influence Russian politics or other internal affairs of the Russian state.

Why Russian Judges Don’t Acquit
In general, bribes aren’t as prevalent in the judicial sphere as most people think. Judges do well enough financially without corruption; only the most reckless judges engage in quid pro quo cash exchanges.

Art and Culture

Setting the Boundaries: Russia’s New Cultural State Policy
The Russian government is sending out the message that unofficial culture will be tolerated as long as it agrees not to seek state funding. But drawing the dividing line between official and unofficial will not be easy.

Monument to the Creator of the AK-47 is Unveiled in Moscow
Russia has unveiled a towering new monument to the inventor of one of the world’s best-known weapons.

What Do Russians Think of Moscow’s New Kalashnikov Statue?
We asked passersby what they think of the tribute.

Molotov Cocktails Thrown at Studio of Embattled Russian Director
The studio of Russian director Aleksei Uchitel, who has been under pressure from conservative activists for his film highlighting the romantic youth of Tsar Nicholas II, has reportedly been attacked.


About the Author

Katheryn Weaver
Katheryn Weaver is a student of rhetoric and history at the University of Texas, Austin. Her primary areas of investigation include revolution and the rhetorical justification of violence against individuals, state, and society. She is currently studying Russian as a Second Language with SRAS's Home and Abroad Scholarship.