From Volume 6, Issue 26 of EIR Online, Published June 26, 2007
Russia and the CIS News Digest

Moscow Rail Meeting Sees New Deals, Hears Big Plans

June 22 (EIRNS)—Vladimir Yakunin, president of the state-owned company Russian Railways, keynoted the 70th Session of the Executive Committee of the International Union of Railways, held in Moscow starting June 18. Yakunin stressed Eurasian transport corridors: "Today, the most urgent questions are those of developing interregional and transcontinental rail transport corridors, including Eurasian ones."

Noting that this year is the 170th anniversary of the first railroads in Russia, Yakunin stressed his company's importance within the Russian economy. It still employs 1.3 million people, or over 2% of the Russian labor force. He talked about the strategy for developing Russia's railroads to the year 2030, "which includes, in the long term, the implementation of a number of major rail construction projects." On April 10, at a government meeting chaired by President Vladimir Putin, Yakunin identified one of those major projects as being the 3,500 km rail line from the Lena River to the Bering Strait.

A number of deals were signed on the sidelines of the conference. Russian Railways has set up a joint venture with Germany, Poland, and Belarus to improve rail services and cargo traffic between Russia and western Europe, announcing June 18 that it will "streamline the transportation process, improve the quality of services, and increase the volume of freight shipments along International Transport Corridor No. 2 linking Berlin, Warsaw, Minsk, Moscow, and Nizhny Novgorod." The venture is worth some $65.3 million. It will coordinate different rail gauges, customs regulations, and other matters to cut travel time. The four partners are considering extending the route to Yekaterinburg, in the Urals, and eventually linking it to the Siberian rail network.

On June 21, Hartmut Mehdorn, the chairman of Deutsche Bahn, and Yakunin signed a logistics agreement, which the Frankfurter Allgemeine Zeitung described as a breakthrough, after lengthy negotiations. According to the report, both sides stressed that "German and Russian railways are not in competition, but are friends, who want to optimize traffic." In a remarkable statement, the two executives added, "The land-bridge between Europe and Asia is no longer a vision for the future, but it is reality." Mehdorn and Yakunin both expressed confidence, that China could be integrated into this joint project within the next year.

The FAZ notes that freight transport between the EU and Russia was 300 million tons in 2006, with 60 million tons between EU and China, and a fairly low percentage of these goods moved by rail. Under the new agreement, 34,000 containers will be shipped between Russia and Germany. The number is expected to double or triple in the near future, as customers are offered integrated services to ease the existing difficulties with different gauges, electricity systems, and customs procedures.

On June 18, Ukrainian E-news reports, Yakunin also signed a memorandum of understanding with Vladimir Kozak, head of Ukrzaliznyshchi, on extending wide-gauge track westward through Slovakia to Vienna, Austria. Ukrzaliznyshchi will provide technical expertise for the project, which may include a new logistics center. The Ukrainian report talks about huge economies from the elimination of switch-overs from one gauge to another at border crossings, claiming that "extending wide-gauge rail to the center of Europe will make it possible to increase the freight volume by 60%, and to ship cargoes by rail from the Asia-Pacific Region with no interruptions."

New Central Asian Railway Is Planned

June 20 (EIRNS)—Turkmen President Gurbanguli Berdymukhamedov, back from an official visit to Iran, stated that he had received Iran's agreement to build a railway link to join the Central Asian Republics to the Persian Gulf ports. This "North-South" railway is to go from Kazakstan to Turkmenistan, and thence to the coast of the Persian Gulf. "Our Iranian brothers," the President stated, "have agreed to implement this large-scale project." AP reported that the deal should be signed at a Caspian Sea summit in Tehran later this year. The rail project, which could transport 10 million metric tons of cargo per year, is part of the rail corridor linking Russia and Eastern European countries with the Persian Gulf and Indian subcontinent.

Russian Magazine: City of London Is the Problem

June 19 (EIRNS)—Tatyana Gurova, deputy editor of the influential Russian economics weekly Expert, wrote in the June 11-17 issue, about the difficulties in mobilizing credit to finance industrial activity and other business inside Russia. She cast her article in the framework of the discussion launched by Kremlin deputy chief of staff Valentin Surkov, about "sovereign democracy." Can a national economy really be sovereign, asks Gurova, "if its money market is shaped and regulated chiefly by foreign financial flows?"

The carefully argued article includes a sub-section titled "Outplaying London." This passage continues the critical look at Russia's relations with Britain's ruling elite, both British intelligence and the City of London, that has otherwise been unfolding around the Litvinenko murder case (which Russian sources charge Britain's MI6 with staging), in President Putin's recent statements (on the eve of the G-8 Summit, he called Royal Dutch Shell's 1990s operations in Russia "colonial"), and in specialized publications. In an online discussion of the article, it was linked to Lyndon LaRouche's recent interviews and articles about the historical and present role of the Anglo-Dutch financial oligarchy.

Gurova wrote: "The West can find no better strategy towards the economically attractive nation of Russia, than to turn it into one big clearing center: We are to take loans, guarantee them with our assets, and repay with interest when they come due. The main player in this is London. It is precisely London—having taken over from New York the status of the world's chief financial center, at the cost of losing [Britain's] own national industry—that is the most interested in raking off grains from the huge Russian economy. It is precisely London, that watches eagerly, as Russia attempts to arrange its complex economic ties with EU member countries. It is precisely London, that launched a fight to the death against the deal between Russia's Severstal and the Arcelor company of Luxembourg. It is precisely London, that stated absolutely unambiguously, out of the mouth of Tony Blair himself, that British businessmen would pull their funds out of Russia, if political relations deteriorated."

People who doubt the scale or importance of British investment in Russia or internationally, Gurova recommended, should listen to what Expert's London correspondent reported, a couple of issues back: "Today about 80% of banking operations are conducted directly or indirectly through London, and it accounts for 70% of the secondary market for securities and 50% of the derivatives market. London is the world's main center for offshore funds management."

Ivashov: World Financial Elite Exploits United States

June 17 (EIRNS)—Gen. Leonid Ivashov, the former international department head for the Russian Defense Ministry, is currently organizing an Autumn 2007 All-Russian Public People's Convocation (Sobor), whose goals he outlined in a June 14 interview with A May 26 organizing seminar for the Convocation brought together veterans' representatives, Russian Orthodox Church people, educators, scientists, military, Cossack, human rights, trade union, sports, and other Russian layers, according to Some of them described their goal as to form the kind of coalition that economist Sergei Glazyev's Rodina party was meant to be, but it became factionalized after its strong electoral showing in 2003.

Ivashov told that he wants Russia to be a "spiritual leader" in the world, which cannot be a "unipolar world." He characterized the current situation not by attacking the U.S.A. per se, but by calling to unite "everybody who is ready to oppose the murderous, rapacious project, that the world financial elite is attempting to impose, using the U.S.A. as its battering ram and world gendarme."

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