In this issue:

Eurasian Railway Corridor Development Discussed at Moscow Conference

Russia May Shift From Dollar to Euro for European Energy Sales

Russia and China To Develop Nuclear Power Plants for Space

Russia and South Korea Meet on Economic Cooperation

Russia Prepares for 'Worst-Case' Korean Peninsula Scenario

Russia Wants UNSC Session and New UN Resolution on Iraq

Richard Perle in Moscow, Defending Iraq War—and Khodorkovsky's Yukos Oil

Chechen Rebel Emissary Received in Washington

Cache of Suicide-Bomber Equipment Found in Moscow

From Volume 2, Issue Number 30 of Electronic Intelligence Weekly, Published July 29, 2003
Russia and Central Asia News Digest

Eurasian Railway Corridor Development Discussed at Moscow Conference

Railway experts from Germany, Poland, Belarus, and Russia met at the Russian Railway Ministry on July 22, to discuss an array of measures to make transfer of goods by rail across their countries more efficient. The meeting was addressed by Russia's Deputy Railway Minister Khasyan Zyabirov, who said: "The European Transport Corridor No. 2 is not only highly optimized for the direct rail axis Moscow-Minsk-Warsaw-Berlin, but has in its continuation the shortest and most promising bridge between Europe and Asia."

Of interest in the context of this meeting is the news released July 23, that container rail/sea freight between Germany and Russia increased by 35% during the past 12 months.

Russia May Shift From Dollar to Euro for European Energy Sales

Germany's Der Spiegel reported the week of July 21 that EU Commission President Romano Prodi recently told journalists he expects Russia soon to be handling its crude oil and natural gas exports to the EU in euros, instead of dollars. Russian President Vladimir Putin wants to "drastically upgrade relations to Europe," Prodi said, referring to close contacts he has to Russian policy-making circles. Hints in this direction have repeatedly been made earlier in Russian media, but this is the first time a leading European Union politician confirmed it.

(For related coverage, see the article in this week's In-Depth section on EU-Russia energy diplomacy.)

Russia and China To Develop Nuclear Power Plants for Space

On July 21 Russian Atomic Energy Ministry spokesman Nikolai Shingaryov announced a joint Russian-Chinese nuclear power development project. On the eve of a meeting of the Sino-Russian subcommittee on nuclear cooperation, he said the group would discuss cooperation in developing technologies for the use of nuclear energy in space. Those meetings were co-chaired by Russian Atomic Energy Minister Alexander Rumyantsev, and Chairman of the Chinese Committee on Defense Sciences, Technology and Industry Zhan Yunchuan, who arrived in Moscow July 21.

It was confirmed during the week (see also our Asia News Digest), that the two sides also discussed cooperation in building floating nuclear power plants, which Russia has already developed for power and heating in coastal cities in Russia's far north. Last November, the Russian Ministry of Atomic Energy had announced plans to build small floating nuclear power plants to provide power to remote areas, as well as heat and power for water desalination. The Ministry said at that time that the project was "short of investments," and that it had to develop a program for financing it. Now, Chinese financing is a possibility.

On July 23, a spokesman for the state-owned company that runs the country's nuclear power plants, Rosenergoatom, said that it would cost $145 million to build the first plant, and that the ship would be built in Severodvinsk in northern Russia. Russia is hoping that China will provide a loan for between half and all of the costs to get the project moving forward. In the future, China could build barges for floating nuclear plants at its shipyards, Rosenergoatom said, as officials were discussing the project.

Russia and South Korea Meet on Economic Cooperation

The fifth session of the Korea-Russia Joint Committee on Economic, Scientific and Technological Cooperation took place July 21-22 in Seoul, according to a pre-announcement from the Korean Ministry of Finance and Economy (MOFE) on July 18. The Ministry said the meeting would give Seoul and Moscow an opportunity to further expand bilateral cooperation on several fronts. It is the first such meeting since President Roh Moo-hyun took office in February, and was expected to lay the foundation for future exchanges in such fields as trade, investment, fishing rights, finances and energy development. MOFE said that Minister Kim Jin-pyo would lead the Korean delegation, which also included a vice minister from the Ministry of Construction and Transportation and deputy minister-level officials from other related government agencies.

Russia Prepares for 'Worst-Case' Korean Peninsula Scenario

In a July 18 interview published in Izvestia of July 21, Russian Deputy Foreign Minister Alexander Losyukov made gloomy remarks about the possibility of an escalating crisis between the United States and North Korea. He said that while the Russian government is still engaged in efforts to find a diplomatic solution, Russia also has to be prepared for a situation that continues to escalate. A worst-case scenario, with nuclear war between the Americans and North Koreans, could not be ruled out: "There are, unfortunately, negative scenarios which we have to think about."

Without going into details, Losyukov hinted that measures were being taken all over Russia, but primarily in the Primorye region of the Far East, where Russia shares has several kilometers of common border with North Korea. This does not necessarily involve military measures alone, he added.

Following up Losyukov's interview, an unnamed Russian diplomat was quoted in wire dispatches on July 22 as saying: "The course of events shows that the North Korean crisis may become even worse, and a military outcome is possible. The Primorye and Khabarovsk regions may find themselves affected by the use of nuclear weapons, thus the Ministry deems it reasonable to consider the worst situation and prepare without waiting for an impending solution."

Oleg Melnikov, the head of the Primorye region's emergency situations commission, is cited as saying that his region is "ready for any course of events concerning the North Korea conflict." His officials regularly check civil defense sites, and preparations are being made to put the emergency network on immediate alert. On July 23, Governor Sergei Darkin of Primorye announced more of the contingency plans for the eventuality of a U.S. attack on North Korea. Kommersant reported a speech in which Darkin said that his region could absorb up to 200,000 people fleeing North Korea in case of a U.S. military strike. Darkin added, however, that cities in the region are not prepared to deal with a wave of radioactive fallout from an attack on North Korean nuclear facilities.

Russia Wants UNSC Session and New UN Resolution on Iraq

Russian Foreign Minister Igor Ivanov said July 22 that the United Nations Security Council needs to pass a new resolution, to prevent further deterioration of the situation in Iraq. Addressing a conference in Moscow, Ivanov said that to halt this deterioration will take the efforts of the international community, as well as Iraqis. A new resolution would set a date for forming a real Iraqi government, and reinvolve the UN in Iraq.

The previous week, during his tour of several Middle Eastern countries, Ivanov had already called for the UNSC to convene for the purpose of working out "appropriate decisions on the Iraqi problem." On July 17, Deputy Foreign Minister Yuri Fedotov told Interfax that Russian troops could be involved—if the UN were to mandate an international peacekeeping force. Under "the coalition of countries occupying Iraq" at present, however, Fedotov said that "Russian participation is ruled out."

Richard Perle in Moscow, Defending Iraq War—and Khodorkovsky's Yukos Oil

Richard Perle, a kingpin of the Cheney-led war party in Washington, was in Moscow the week of July 21 in his capacity as an American Enterprise Institute operative. Perle addressed a conference at the Moscow Institute of Political Studies, a Project Democracy-type outfit specializing in "democracy, market relations, law and order, and deregulation."

The Los Angeles Times, one of the few U.S. press to cover the Perle trip, reported July 23 that when meeting Russian political analysts, Perle "had an unsolicited word of advice: Lay off Yukos Oil Co." Like Ambassador Alexander Vershbow a week earlier, Perle made threatening statements about "real damage to the prospects for future Russian economic growth," due to the anti-Yukos campaign.

Perle held forth in a June 22 interview on Radio Echo of Moscow, fielding such questions as, "Richard, they didn't find any WMD. Are you sure they'll be found? If so, when—and how long will the search be, 200 years, 300?" Perle's bald-faced reply was that WMD are hard to find, but the invasion was justified to "put an end to a regime, which ran a harsh regime of terror for 30 years." Perle also talked in undiplomatic fashion about faction fights in Russia, saying of Moscow's failure to welcome the invasion of Iraq, "I have the impression that there were debates in the Kremlin, over what position to take. Unfortunately, the bad guys—as we call them—won."

Chechen Rebel Emissary Received in Washington

Salambek Maigov, an envoy of Chechen separatist "President" Aslan Maskhadov, was in Washington for a five-day visit the week of July 14, the Associated Press reported. He met with U.S. officials and legislators—all unnamed.

Cache of Suicide-Bomber Equipment Found in Moscow

RIA Novosti reported early July 25 that a combined FSB (internal security) and Prosecutor General's task force had located six suicide-bomber belts, armed and ready for use, in a Moscow-area flat. The area was cordoned off. After 16 people died in suicide bombings at an open-air concert in Moscow earlier in July, Russian security officials said "teams" of Chechen suicide bombers were believed to be operating in the city.

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