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By John Helmer, Moscow

President Vladimir Putin hosted his annual supper for the largest holders of capital in Russia on Monday evening. Compared to his table in December 2015, he added 15 extra seats, and for the first time men of little capital have been invited. Representatives of small business and even one Moscow house builder with a reputation for destroying city heritage sites were seated too. With a first-time invitation to sit down  also came rehabilitation for Sergei Frank, chief executive of the state shipping company Sovcomflot, whose business practices have been judged by the British High Court, Court of Appeal, and Supreme Court to be dishonest

Putin’s address was shorter than usual. “Despite the unfavourable situation on the global markets and in the political sphere,” he said, “we have indeed seen changes for the better. We have succeeded in stabilising the situation in the economy. This is a clear and evident fact today. We need now to set in place a strategy for confident growth, and this is something we can achieve together. Of course, there are still many outstanding problems and many reasons for dissatisfaction. There is still much to change and improve in order to feel more confident. But at least we all agree what we need to do, how we need to do it, and what timeframe is realistic.”

The annual affair, with a formal speech on the record and a private session behind closed doors,  commenced in December 2014, when the table in St. Catherine Hall was round, and there were seats for 41 businessmen. Putin was accompanied by his chief of staff; his economic advisor; the deputy prime minister in charge of business, and the head of the Central Bank. Except for Sergei Ivanov’s replacement as staff chief by Anton Vaino, the quad remained the same this week. In 2015 the number of businessmen was 47.

For the lineup and speeches in 2014, click to open.   In 2015, follow the proceedings here

There were more smiles on December 18, 2014, especially on the part of Vladimir Yevtushenkov (below, left), who, hours earlier,  had been released from house arrest on charges of embezzling shares of the Bashneft oil company. Yevtushenkov returned in 2015 and this week  too. Newcomer on this occasion was Mikhail Gutseriev, who has also been charged with oil company fraud but moved to England before the Russian police could arrest him; he was rehabilitated in 2010. 

Gutseriev (below,centre) is now the third member of the Glencore group at the Kremlin feast; the other two, Oleg Deripaska of the state aluminium monopoly Rusal and Igor Sechin (right) of Rosneft, have all signed large debt, shareholding and commodity commission obligations to the Swiss trading concern.  

Mikhail Fridman, control shareholder of Alfa Bank, Vimpelcom and the X-5 supermarket company, has not attended Putin’s reception from the start. But in 2014 he sent three of his men, Pyotr Aven, Andrei Kosogov,  and German Khan in his stead. Kosogov and Khan disappeared a year ago. Aven is the sole survivor of the Fridman group still at the Kremlin.

Roman Abramovich and Sergei Generalov were invitees in 2014, but were absent last year. They have returned to their places.

Kommersant photographs of Monday’s reception: from left to right – Aven, Yevtushenkov, Abramovich, Generalov.
Source: http://www.kommersant.ru/gallery/3175832#id=1367142

This year Putin had less than usual to say. In 2014 he spoke for 4 minutes; in 2014 for 3 minutes 50 seconds. This year he was down to just 3 minutes. As Putin spoke, the official Kremlin record omitted close-ups of the faces of his guests. The Russian Union of Industrialists and Entrepreneurs (RUIE), which organizes the annual meeting, has  refused  to provide the guest list; the Kremlin is more obliging. Here is the Russian record.   For the official English transcript, click again.  

Missing from all three guest lists are three names identified on US and European Union sanctions lists as oligarch-sized businessmen whom the US Treasury considers personally close to Putin — the Rotenberg brothers, Arkady and Boris; and St. Petersburg banker Yury Kovalchuk.  The fourth “crony” to be targeted by sanctions and to be seated three years in a row is Gennady Timchenko.

The court jester for the Kremlin, Kommersant reporter Andrei Kolesnikov, recorded  his sources as confiding that the buffet which followed the  speeches, was as light as Putin’s mood. Later, Kolesnikov asked Mikhail Prokhorov, whose Onexim holding has been trying to sell its principal Russian assets, if he is planning to get married.

In the past RUIE has jealously guarded its status as the representative of Russian business to the state. This year, however, it agreed to share the role with the Russian Chamber of Commerce, the Business Russia organization, and OPORA, the all-Russia organization of small and medium-sized businesses. 

Among the relatively small businessmen invited to the Kremlin table this year were Sergei Nazarov (below, left), owner of the tool engineering company Interskol;  and  Vladimir Polyakov (right), chairman of Monocrystal, developer of materials for applications in electronics, optical devices, optics, high-precision mechanics, instrument engineering and laser technologies.   

One other first-timer at this week’s supper was Leonid Kazinets of the Barkly Corporation; he is a   house builder  and real estate speculator.  Forbes has reported him to be worth a lot and his recent wedding was expensive.  His kompromat record can be followed here.

Barkly is an unlisted company and Kazinets’ worth comes from advertisements in the real estate ratings of the Russian edition of Forbes. The three London Stock Exchange-listed Russian real estate companies have an accumulated market value at present of $5.7 billion, and their share prices have been rising steadily this year. They have not been admitted to Putin’s supper.


KEY: yellow=PIK (market cap of $2.9 billion); pink=LSR ($1.8 billion); blue=Etalon ($993 million).
Source: https://www.bloomberg.com/quote/PIK:LI

The only serious leak from the closed session was a complaint by Rusal’s Deripaska contradicting Putin’s opening claim that “we all agree what we need to do, how we need to do it, and what timeframe is realistic.”   Deripaska, according to Kommersant, “was emotional.  He said that with inflation at 5% in 2016, the interest rate does not fall below 10%. And in 2017 the government promises that inflation will be 4% — and what will happen to the interest rate?  Will that too go down by just one percentage point? Oleg Deripaska said that under these conditions there can be no real investment activity. What investment projects?! he asked, and not only of Mr. Putin, but of the head of the Central Bank,  Elvira Nabiullina, who was present at this meeting.”  If Nabiullina replied to Deripaska, it has not been reported.

FOOTNOTE TO LEAD IMAGE: The English terms “on the skids” and “skid row” come from the North American logging business at the end of the 19th century. In those days the road leading from the cutting site and lumber camp was usually laid with wooden skids to enable the rolling or skidding of the freshly cut timber in the direction of a river or mill. The loggers would live in huts along this road. When the timber ran out and the lumbermen moved on, their shanties would be taken over for the sale of cheap drinks and sex. If you are on the skids, the term means you are headed on a downward slope to both.

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