Digest
Nikolai Petrov’s weekly bulletin
March 27-31, 2023
Nikolai Petrov
Independent scholar
A short summary of the most important political developments by Nikolai Petrov.
Updating foreign policy concept and patching economic holes
The Foreign Policy Concept of the Russian Federation, approved by Presidential Decree №229 on March 31st, has Orwellian overtones in places — for example, in its interpretation of the causes of the current war:
The U.S. and its satellites used the measures taken by the Russian Federation to protect its vital interests in Ukraine as a pretext to radicalize its longstanding anti-Russian policy and unleash a new type of hybrid war.
The radical anti-Americanism articulated in the Foreign Policy Concept manifested itself in the March 30 arrest of Evan Gershkovich, the Moscow correspondent of The Wall Street Journal and a U.S. citizen, on charges of espionage. This is the first time that something like this has happened in the history of modern Russia. The last time a foreign journalist was accused of spying in the USSR was in 1986, when KGB agents arrested U.S. News & World Report correspondent Nicholas Daniloff. Daniloff was soon exchanged for a Soviet spy detained in the United States.
The Foreign Policy Concept is also interesting for what it reveals about the decision-making process in contemporary Russia.
In January 2022, just weeks before the invasion of Ukraine, President Putin instructed that the existing Concept, adopted in 2016, should be refined to reflect new realities. At a meeting with the permanent members of the Russian Security Council on March 31 — that is, after the start of the war — Putin made discussion of the new Concept the first item on the agenda, even while stating that he had already signed a decree approving it.
The actual “discussion” consisted of Foreign Minister Sergey Lavrov outlining the main provisions of this document. The Concept was developed by the Foreign Ministry “together with other federal executive agencies” (apparently referring to the heads of the FSB and SVR). The Council of Ministers apparatus and Putin's assistant on foreign policy issues, Yuri Ushakov, also participated in the work on the Concept.
The government discusses emerging economic problems
On March 28-30, at a meeting with the government leadership, Putin made an unexpectedly critical statement, observing the weak dynamics of the manufacturing industry and ordering “[the restoration of] the most damaged industries, such as the automotive industry and the timber industry complex.” This week, the governor of Samara region, Dmitri Azarov, reported to Putin on the situation in the automobile industry, where the market shrank by 58.8% in 2022 compared to 2021, while Putin personally looked into the situation in the timber processing complex in the North-West, which lost its market share due to the sanctions during his visit to Arkhangelsk Region in mid-February.
First Deputy Prime Minister Andrei Belousov spoke about ways to strengthen financial sovereignty, focusing on the problem of a shortage of long-lived investment, including in connection with the departure of foreign investors. He proposed to solve this problem using citizens' savings, which, according to the Central Bank and Rosstat, amounted to 36.82 trillion rubles on January 1, 2023.
The Foreign Policy Concept of the Russian Federation, approved by Presidential Decree №229 on March 31st, has Orwellian overtones in places — for example, in its interpretation of the causes of the current war:
The U.S. and its satellites used the measures taken by the Russian Federation to protect its vital interests in Ukraine as a pretext to radicalize its longstanding anti-Russian policy and unleash a new type of hybrid war.
The radical anti-Americanism articulated in the Foreign Policy Concept manifested itself in the March 30 arrest of Evan Gershkovich, the Moscow correspondent of The Wall Street Journal and a U.S. citizen, on charges of espionage. This is the first time that something like this has happened in the history of modern Russia. The last time a foreign journalist was accused of spying in the USSR was in 1986, when KGB agents arrested U.S. News & World Report correspondent Nicholas Daniloff. Daniloff was soon exchanged for a Soviet spy detained in the United States.
The Foreign Policy Concept is also interesting for what it reveals about the decision-making process in contemporary Russia.
In January 2022, just weeks before the invasion of Ukraine, President Putin instructed that the existing Concept, adopted in 2016, should be refined to reflect new realities. At a meeting with the permanent members of the Russian Security Council on March 31 — that is, after the start of the war — Putin made discussion of the new Concept the first item on the agenda, even while stating that he had already signed a decree approving it.
The actual “discussion” consisted of Foreign Minister Sergey Lavrov outlining the main provisions of this document. The Concept was developed by the Foreign Ministry “together with other federal executive agencies” (apparently referring to the heads of the FSB and SVR). The Council of Ministers apparatus and Putin's assistant on foreign policy issues, Yuri Ushakov, also participated in the work on the Concept.
The government discusses emerging economic problems
On March 28-30, at a meeting with the government leadership, Putin made an unexpectedly critical statement, observing the weak dynamics of the manufacturing industry and ordering “[the restoration of] the most damaged industries, such as the automotive industry and the timber industry complex.” This week, the governor of Samara region, Dmitri Azarov, reported to Putin on the situation in the automobile industry, where the market shrank by 58.8% in 2022 compared to 2021, while Putin personally looked into the situation in the timber processing complex in the North-West, which lost its market share due to the sanctions during his visit to Arkhangelsk Region in mid-February.
First Deputy Prime Minister Andrei Belousov spoke about ways to strengthen financial sovereignty, focusing on the problem of a shortage of long-lived investment, including in connection with the departure of foreign investors. He proposed to solve this problem using citizens' savings, which, according to the Central Bank and Rosstat, amounted to 36.82 trillion rubles on January 1, 2023.
“The government is essentially proposing a modernized version of Soviet domestic loans.”
Various options for investment accounts and even life insurance are being considered, the essence of which is lending money to the government for 5 years or more. All the necessary bills are already with the Duma and the corresponding laws should be adopted as early as this month. Apparently, the government has decided how to gain access to citizens’ savings, but has not yet decided how to effectively spend this money.
In some of Putin's words at this meeting, a clear Orwellian twist can be observed: a year after the start of the war, which has caused enormous human losses, the president stated that “According to Rosstat, last year life expectancy in Russia rose by 2.7 years. It now stands at 72.8 years. Mortality continues to decline.”
Gubernatorial replacements
This week, Putin replaced the Omsk governor and blessed the Samara governor for reelection. These decisions were apparently made in preparation for this September's gubernatorial elections.
In the last two weeks of March, Putin replaced three regional heads. These replacements point to the Kremlin's rejection of last year's “party” model. Outgoing Omsk Governor Alexander Burkov (March 29) and Smolensk Governor Alexei Ostrovsky (March 17) were “party” governors, Burkov from the party A Just Russia — For Truth (SRZP) and Ostrovsky from the Liberal Democratic Party of Russia (LDPR). While United Russia retained an overwhelming majority of governors, the Communist Party of the Russian Federation (KPRF) (three governors), the LDPR (now one instead of the former three), and A Just Russia (now one instead of the former two) were represented in the gubernatorial corps in line with the “party quota” that has existed since 2012.
In addition to the two who have already resigned, two more regional heads, both from the KPRF — Andrei Klychkov (Oryol region) and Valentina Konovalova (Khakassia) — are in the “risk zone,” meaning that, according to experts, they may lose their positions on the eve of the September elections.
The recently established New People party, which entered the Duma in 2021, did not receive a single gubernatorial seat.
Apparently, the Kremlin has decided to eliminate — or, at the very least, reduce — party representation. The so-called “systemic opposition” parties are absolutely obedient to the Kremlin, so it is not that the Kremlin is afraid of disloyal governors, but rather that, given the unconditional loyalty and cohesion of the elite around Putin, it is difficult and even pointless to distinguish between parties.
The party leaders themselves did not express a shadow of displeasure in connection with the loss of these governorships. Leonid Slutsky, leader of the LDPR, asked Prime Minister Mikhail Mishustin, during the Duma report on March 23, to find “a decent job in government agencies” for the Communist former governor of Smolensk, Alexei Ostrovsky, while Sergei Mironov, leader of the SRZP, expressed only the timid hope that “Burkov's experience and authority will be sought after in new posts for the good of the Motherland.”
Of the three appointees who have replaced the outgoing “party” governors, two belong to the “Donbas draft:” Vitaly Khotsenko, who was appointed to lead the Omsk region, served several months as head of the DNR government, and Vladislav Kuznetsov, the new leader of Chukotka, was previously first deputy prime minister of the LNR (from June 2022). The third, Smolensk Governor Vasily Anokhin, was in charge of integrating the “new” regions into the government apparatus.
All three “replacements” graduated from the “school of governors” organized several years ago by First Deputy Chief of Staff Sergei Kirienko and have prior experience of working in the regions. Perhaps their appointment is a signal from the Kremlin to young people who seek to climb the professional ladder: if you want to make a career for yourself, get an “internship” in the annexed regions. The “new regions” may thus be seen as a “rotation shift” to test gubernatorial candidates.
In some of Putin's words at this meeting, a clear Orwellian twist can be observed: a year after the start of the war, which has caused enormous human losses, the president stated that “According to Rosstat, last year life expectancy in Russia rose by 2.7 years. It now stands at 72.8 years. Mortality continues to decline.”
Gubernatorial replacements
This week, Putin replaced the Omsk governor and blessed the Samara governor for reelection. These decisions were apparently made in preparation for this September's gubernatorial elections.
In the last two weeks of March, Putin replaced three regional heads. These replacements point to the Kremlin's rejection of last year's “party” model. Outgoing Omsk Governor Alexander Burkov (March 29) and Smolensk Governor Alexei Ostrovsky (March 17) were “party” governors, Burkov from the party A Just Russia — For Truth (SRZP) and Ostrovsky from the Liberal Democratic Party of Russia (LDPR). While United Russia retained an overwhelming majority of governors, the Communist Party of the Russian Federation (KPRF) (three governors), the LDPR (now one instead of the former three), and A Just Russia (now one instead of the former two) were represented in the gubernatorial corps in line with the “party quota” that has existed since 2012.
In addition to the two who have already resigned, two more regional heads, both from the KPRF — Andrei Klychkov (Oryol region) and Valentina Konovalova (Khakassia) — are in the “risk zone,” meaning that, according to experts, they may lose their positions on the eve of the September elections.
The recently established New People party, which entered the Duma in 2021, did not receive a single gubernatorial seat.
Apparently, the Kremlin has decided to eliminate — or, at the very least, reduce — party representation. The so-called “systemic opposition” parties are absolutely obedient to the Kremlin, so it is not that the Kremlin is afraid of disloyal governors, but rather that, given the unconditional loyalty and cohesion of the elite around Putin, it is difficult and even pointless to distinguish between parties.
The party leaders themselves did not express a shadow of displeasure in connection with the loss of these governorships. Leonid Slutsky, leader of the LDPR, asked Prime Minister Mikhail Mishustin, during the Duma report on March 23, to find “a decent job in government agencies” for the Communist former governor of Smolensk, Alexei Ostrovsky, while Sergei Mironov, leader of the SRZP, expressed only the timid hope that “Burkov's experience and authority will be sought after in new posts for the good of the Motherland.”
Of the three appointees who have replaced the outgoing “party” governors, two belong to the “Donbas draft:” Vitaly Khotsenko, who was appointed to lead the Omsk region, served several months as head of the DNR government, and Vladislav Kuznetsov, the new leader of Chukotka, was previously first deputy prime minister of the LNR (from June 2022). The third, Smolensk Governor Vasily Anokhin, was in charge of integrating the “new” regions into the government apparatus.
All three “replacements” graduated from the “school of governors” organized several years ago by First Deputy Chief of Staff Sergei Kirienko and have prior experience of working in the regions. Perhaps their appointment is a signal from the Kremlin to young people who seek to climb the professional ladder: if you want to make a career for yourself, get an “internship” in the annexed regions. The “new regions” may thus be seen as a “rotation shift” to test gubernatorial candidates.
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