Streetwise Professor

March 21, 2013

Rogozin Has Competition

Filed under: Economics,Politics,Russia — The Professor @ 8:56 pm

Around here, Russian Deputy PM Dmitri Rogozin goes by the sobriquet “Rogozin the Ridiculous” for his frequent buffoonery.  This has apparently elicited envy from his ostensible boss, Prime Minister Dmitri Medvedev.  Responding to the meltdown in Cyprus, the man best known for bopping to “American Boy” and forgetting to put an SUV in park in the midst of a crowd made the following suggestion:

Russia, involved in a global uproar around the Cyprus bail-out plan, should think of creating its own off-shore zones in the far-east region by the Pacific Ocean, Prime Minister Dmitry Medvedev said Thursday.

. . . .

“Maybe we should consider creating a [special] zone in the far east. We have many fine places — Sakhalin, Kuril Islands. Maybe as well a part of our money, which is in Cyprus and other zones…which are not being mentioned for obvious reasons, like BVI (British Virgin Islands), Bahamas etc. will come to us,” Mr. Medvedev told a government meeting.

Mr. Medvedev added that such initiative will contribute to development of the far-east region.

You know, I always get the BVI and the Kurils mixed up.  Ditto the Bahamas and Sakhalin.  Luxembourg, Jersey, Siberia.  Who can tell them apart, really?  They’re all such “fine places.”  TFF.

I’m dying here.  Seriously.  I can’t remember when I’ve heard anything so stone cold idiotic.  And I’ve been following Eurotard pronouncements on Cyprus quite closely.

So where should these “special zones” be?  Why do they have to be islands?  Siberia is vast, and there are many places that could use an economic boost.

I have an idea: what about Chita?  There’s already an (ex) billionaire there.

Better yet: what about some former Gulag establishments?  I’m sure they could use an economic boost.  Kolyma, for instance.  It’s synonymous with gold, after all.

Of course climate-and the lack of, you know, actual people-isn’t the only thing that makes Siberian locales unlikely sites for financial centers that cater to the rich.  Not even the most important thing. Global warming could turn Siberia into Miami and the place would still be a very hostile climate for foreign money, because of the lack of property rights and the rule of law in Russia.  Note that Cyprus was a financial player primarily because Russians wanted to get their money out of Russia: if the Russians want to get their money out, who in their right mind would want to put their money in?

Indeed, capital flows out of Russia continue apace, to the tune of $16 billion in the first two months of the year, an interesting contrast to the $10 billion for the entire year predicted by the Russian Central Bank.  I say again: if Russians are frantic to get their money out, who with two synapses to rub together wants to put their money in? Into freakin Siberia no less.

Utterly ridiculous.

But Rogozin is not going to take this lying down.  Apparently in anticipation of Medvedev’s challenge, Rogozin preemptively doubled down on ridiculousness, by appealing to Steven Seagal to lobby Congress to relent on restrictions on the importation of Russian sporting rifles.  Where to begin? Like Steven Seagal would matter even when there isn’t anti-gun hysteria in DC.  And how absurd that a Deputy PM of a country that demands to be taken seriously is reduced to appealing to a washed up actor  who was something of a joke even at his prime to help out a minor Russian industry.

As inane as Rogozin’s appeal is, it pales in comparison to Medvedev’s suggestion.  The Kurils as a financial center.  Such a fine place.  A fine place indeed.

I can’t stop chuckling.

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31 Comments »

  1. > I have an idea: what about Chita? There’s already an (ex) billionaire there.

    If you mean Khodorkovsky – he hasn’t been there for along time.

    > I always get the BVI and the Kurils mixed up. Ditto the Bahamas and Sakhalin. Luxembourg, Jersey, Siberia. Who can tell them apart, really? They’re all such “fine places.” TFF.

    it is easy to tell Sakhalin from Jersey. Sakhalin is where you can get all the greatest seafood in the world fresh and cheap: king crab, red caviar, black caviar, scallops, salmon, calamari, octopus, etc. Jersey is the place for fish and chips. My teammate was from Sakahlin. He actually went back there from the SF Bay Area. He said that the climate is not that bad there.

    > Why do they have to be islands?

    Valid question. Why not Sochi instead? Close to Olympic-quality skiing and luge runs. And you may meet Putin there. Especially at the local badminton gym. Have they invented downhill badminton yet? As I recall, the Kennedy clan used to be into downhill football.

    You don’t need too many bankers there. Just enough to provide off-shore services for the people in the US and EU who need off-shore services. With the US government putting pressure on one off-shore after another, it is not impossible that pretty soon Mitt Romney and other Republican leaders, in their all-consuming quest for not paying American taxes (taxes are for the losers), will have no choice but to put their money into Sochi banks.

    Convincing investors that there would not be any fly-by-night rip-off banks – that’s another question. But certainly Depardieu, Bordot and a whole bunch of European russophiles will take advantage. Especially since Depardieu has been invited to give up his decadent infidel ways and take up decadent halal ways in the nearby Grozny with Kadyrov.

    > appealing to Steven Seagal to lobby Congress to relent on restrictions on the importation of Russian sporting rifles.

    The problem here is the lack of PR savvy on the Russian part. If they advertise how low their gun prices are to, say, Breitbart, Fox News and Limbaugh audiences and offer big volume discounts for the purchases of at least 10 guns per household, the people in red states will force the Congress to lift restrictions. Of course, the US gun companies that run NRA, will oppose that, proving that NRA’s goals have nothing to do with libertarianism and the Constitution and everything with greed.

    > Note that Cyprus was a financial player primarily because Russians wanted to get their money out of Russia

    Yes, the Russian elites want to hide their illegal incomes from the Russian government.

    > if the Russians want to get their money out, who in their right mind would want to put their money in?

    The American and EU elites who want to hide their illegal incomes from their own government and to avoid taxes, of course. Are you sure your PhD is in domestic economic policies and not in home economics? :-)

    Comment by Vlad Rutenburg — March 21, 2013 @ 10:29 pm

  2. […] http://streetwiseprofessor.com/?p=7147 […]

    Pingback by Street-un-wise Professor | Rutenburg - Red Castle - Красная Крепость — March 21, 2013 @ 10:36 pm

  3. With high-resolution pictures of great Sakhalin seafood:

    http://vladrutenburg.wordpress.com/2013/03/22/street-un-wise-professor/

    Comment by Vlad Rutenburg — March 21, 2013 @ 10:55 pm

  4. We have many fine places — Sakhalin…

    Guffaw!

    Comment by Tim Newman — March 22, 2013 @ 1:52 am

  5. Sakhalin is where you can get all the greatest seafood in the world fresh and cheap: king crab, red caviar, black caviar, scallops, salmon, calamari, octopus, etc.

    Well, not quite. You can get good seafood, but unless you catch it yourself or buy it from a fisherman directly, it is not particularly cheap: most of it is exported to the mainland cities, and the local market prices reflect that (in fact, I can’t think of much that was cheap in Sakhalin). A king crab on the side of the road a couple of hours north of the capital would cost you about $12 back in 2006, probably more now. In Yuzhno-Sakhalinsk you’d pay about twice that. You can get good red caviar, but there is no black caviar in Sakhalin unless it’s been imported.

    He said that the climate is not that bad there.

    It’s not as harsh as Siberia or even Khabarovsk in Yuzhno-Sakhalinsk, but the winters are still long and the snowfall can be severe (this year Toyota Landcruisers were covered with another 2′ of snow on top!). In the north of the island, the weather is severe with biting winds which will cut you in half and, in the summer, mosquitos which will eat you alive. The weather *can* be nice in Sakhalin, but it is not ideal. Although it is usually nice and sunny all winter, not grey and overcast like St. Petersburg.

    Comment by Tim Newman — March 22, 2013 @ 2:01 am

  6. $12? Is that per kilo? $5 per pound of fresh king crab? Here in California it’s frozen and $20 per pound. Maybe I should plan a trip to Sakhalin and Japan (again)…

    Comment by Vlad Rutenburg — March 22, 2013 @ 3:42 am

  7. I think this is an immortal classic:

    http://tcc.export.gov/Trade_Agreements/All_Trade_Agreements/exp_005371.asp

    The Government of the United States of America and the Government of the Russian Federation, hereinafter referred to as the “Parties,”

    In the context of removing a number of existing restrictions on the importation into the United States of firearms and ammunition from the Russian Federation;

    Recognizing the foreign policy interest of the Parties in expanding trade in firearms and ammunition between the, United States and the Russian Federation in a manner compatible with domestic security;

    Recognizing the intention of the United States of America that United States policy with respect to access to the United States market for firearms and ammunition be applied in a nondiscriminatory manner to all of its trading partners;

    Wishing to promote trade and cooperation on an equal and mutually beneficial basis between the United States and the Russian Federation and to expand economic opportunities in the two countries;

    Have agreed as follows:

    The Government of the Russian Federation shall not allow the exportation from the Russian Federation, destined to the United States, of the following firearms and ammunition:

    (a) any firearm, including any new model firearm, except a firearm described in Annex A to this Agreement;

    http://vladrutenburg.wordpress.com/2013/03/22/free-trade-the-american-style/

    Comment by Vlad Rutenburg — March 22, 2013 @ 4:03 am

  8. It was $12 per crab. The folk flogging them on the side of the road don’t go in for anything as sophisticated as scales, and categorise their wares into “Small”, “Normal”, and “Big”.

    Comment by Tim Newman — March 22, 2013 @ 4:23 am

  9. Testing, testing… Please delete if this doesn’t work.

    Comment by Vlad Rutenburg — March 22, 2013 @ 4:24 am

  10. https://www.youtube.com/watch?v=TFWhURqV0iY

    Comment by Vlad Rutenburg — March 22, 2013 @ 4:27 am

  11. It is hard to beat catching a Kamchatka crab through the Sakhalin sea ice and boiling and eating it right there on the ice. Maybe salmon ukha on a riverbank in the fall comes close.

    If anyone can create a more successful opaque banking system than the British as a safe haven for money stolen through corruption then my hats off to them.

    Comment by pahoben — March 22, 2013 @ 8:26 am

  12. I spent 3 months in nearby Petropavlovsk over three nights. It was cold, the roads were covered in a weird muddy, slippery sludge that seemed to have some ice in it, the girls in miniskirts were covered in the road sludge everytime a car went by and it snowed every night. Time of the year? Last three days in April! Polar bears will be sweltering before Siberia is an attractive, off-shore haven for anyone having money AND brains

    Comment by The Pilot — March 22, 2013 @ 2:04 pm

  13. Jeez Pilot grow a set for God’s sake.

    Comment by pahoben — March 22, 2013 @ 3:36 pm

  14. @pahoben

    I did, left and headed to Bora Bora and NZ

    Comment by The Pilot — March 22, 2013 @ 5:06 pm

  15. lol

    Comment by pahoben — March 22, 2013 @ 6:16 pm

  16. It is hard to beat catching a Kamchatka crab through the Sakhalin sea ice and boiling and eating it right there on the ice. Maybe salmon ukha on a riverbank in the fall comes close.

    I often get asked if I went ice fishing when I was living on Sakhalin. I always reply that I didn’t, but I did go ice drinking and I think some fishing might have gotten done at some point. :)

    Comment by Tim Newman — March 23, 2013 @ 1:13 am

  17. @Professor: Medvedev got lost in translation, but you got the gist of it it anyway. The primary meaning of “zona” in [popular] Russian is prison camp.

    Comment by Ivan — March 23, 2013 @ 1:42 am

  18. @Tiim
    As long as thry roused you when the crab was ready. :)

    I am sure you remember nevaga-the fish with the smell of cucumber. It was tasty dried and with a beer.

    Comment by pahoben — March 23, 2013 @ 7:35 am

  19. There is a sub species of Taimen that also spends time in salt water that is found only on Sakhalin. A guy had one in Nogliki one time and probably a100 lbs +. it was big enough to eat a baby. Taimen are the largest trout species in the world and this is the largest Taimen sus species. Taimen are hugely aggressive.

    Pilot did grow a set putting his cardiovascular health at risk by going to a place where the fish have such low polyunsaturated fatty acids. :)

    Comment by pahoben — March 23, 2013 @ 8:05 am

  20. Look guys, it has already started with Sakhalin being chose as the ICE for the LlBOR Walrus swamps.

    Comment by sotos — March 23, 2013 @ 8:11 am

  21. What’s a Libor swamp?

    Comment by Vlad Rutenburg — March 23, 2013 @ 10:36 pm

  22. In response to Vlad Rutenburg (Another “Russia is the best place in the world, but I’m living in Cali…” type, jeeze….) saying “Yes, the Russian elites want to hide their illegal incomes from the Russian government.”

    Ahem, the Russian elites are the government, or are tied to it. The Russian government is quite happy with them having their illegal incomes, as it distributes them in exchange for loyalty.

    Just look at the Magnitsky business. The vermin stealing get no sanction from the state, and in fact seem to have been rewarded, while the person who exposed the crime basically gets tortured to death in prison (and if you don’t think denial of medical care is torture, you are mentally ill) but even gets put on posthumous trial….. yep, only in Russia….

    As for eating “great seafood” from the far east, well, given the horrific environmental catastrophes that occurred during the Soviet period, and I would not be surprised if they still do, you might want to worry about things like Mercury poisoning etc.

    Comment by Andrew — March 24, 2013 @ 10:43 am

  23. Oppose! Swap.Damnable kindle.

    Comment by sotos — March 24, 2013 @ 11:48 am

  24. It may be going too far to say that bankruptcy for Cyprus would only tighten the economic noose around Bashar al-Assad’s neck, but whatever ultimately happens, “debt restructuring” affords an excellent opportunity for finding out who’s been up to no good in ‘Limassolgrad’ and facilitating barbarism a few points of longitude away, right under the EU’s nose.

    https://now.mmedia.me/lb/en/commentaryanalysis/cyprus-russia–and-syria

    Comment by Oleg — March 24, 2013 @ 11:48 am

  25. @Andrew

    Have you seen any of the mercury sampling studies from Great Lakes fish?

    What environmental catastrophies are you referencing in Eastern Russia during Soviet times?

    Comment by pahoben — March 24, 2013 @ 4:17 pm

  26. @Andrew:

    What gave you the idea that I consider Russia to be “the best place in the world”? FYI, I live in Palo Alto, California because I consider it my home. I have spent more than half of my life here, including my youth. No place in the world comes even close for me. Great climate, overabundance of great scientists and thinkers,the greatest variety of international foods, clean air and green spaces, majestic nature all around, ability to play soccer and tennis outdoors almost any day of the year, great skiing 4 hours away, great badminton and table tennis gyms all over the bay, the beautiful and romantic city of San Francisco…

    Now, about your comments:

    > Ahem, the Russian elites are the government
    > Just look at the Magnitsky business
    > The vermin stealing get no sanction from the state

    So, you have figured out that the Russian government is corrupt and that it was bad of them to kill Magnitsky? Wow, you have educated the people on this blog to things that all 6 year old children everywhere take for granted. your mom must be very proud.

    > As for eating “great seafood” from the far east… you might want to worry about things like Mercury poisoning etc.

    Obviously things are not too rosy in the Far East, as everywhere else on the planet. And with the recent nuclear plant disaster in Japan… But I think Sakhalin is way too far to suffer from that.

    I am not aware of any major mercury pollution problems in Sakhalin, but all seafood everywhere is polluted with mercury, with the USA being the world’s dominant polluter in pretty much every category. If you put into the equation that Russia produces much less pollution that the USA but has a much larger territory, and Sakhalin is underpopulated, it is a safe bet that Sakhalin is much less polluted than the average places in the US. In fact, my quick google search indicates that the biggest problems in Sakhalin come from the Western oil companies:

    http://pacificenvironment.org/article.php?id=250

    SEIC/Shell built two 800-kilometer parallel pipelines down the length of Sakhalin Island to transport oil and natural gas from its Sakhalin II facilities offshore of the north east of the island to export terminals in the south. Construction of these pipelines has proven highly disruptive to a globally significant, robust wild salmon habitat. The Russian Far East is home to 1/3 of the world’s remaining salmon stocks and fishing traditionally accounts for a significant portion of the economy on Sakhalin Island. The terrestrial pipelines were trenched through over 1,000 streams and waterways, cutting into vital salmon spawning grounds.

    Toxic Dumping

    SEIC/Shell illegally obtained a permit to dump the dredging waste from a project to deepen Aniva Bay into the shallow waters near shore, thus smothering plant life and directly resulting a massive fish kill. This underwater pile of sludge continues to inflict negative impacts on the marine environment and potentially on the commercial fishing industry supports.

    Comment by Vlad Rutenburg — March 25, 2013 @ 1:58 am

  27. @Oleg:

    When the Sunni side defeats Assad and starts the extermination of Christians and Shiites, will your own country – Norway – build refugee camps for them on your territory, or will you let the Sunnis finish their job of extermination, learning from the way their masters, the Turks, have dealt with Armenians and Kurds?

    Comment by Vlad Rutenburg — March 25, 2013 @ 2:04 am

  28. This links to a study of mercury levels in Scandanavian fish-

    http://www.who.int/ifcs/documents/forums/forum5/hgartikkeli.pdf

    Comment by pahoben — March 25, 2013 @ 6:19 am

  29. If you are chuckling about that, this will make you laugh out loud. See also this lenta.ru “reaction”.

    “…they continue to steal the stolen”, Dm. Medvedev, recalling the motto of Revolutionary Russia in 1918. Except then it was a paraphrase of marxist slogan “expropriation of the expropriators”. Taken together with another recent statement by Medvedev, that Cuprus banks hold big deposits of Russian State funds, this is rather piquant…

    From the mouths of the babies.

    Comment by Tatyana — March 25, 2013 @ 6:36 am

  30. Construction of these pipelines has proven highly disruptive to a globally significant, robust wild salmon habitat. The Russian Far East is home to 1/3 of the world’s remaining salmon stocks and fishing traditionally accounts for a significant portion of the economy on Sakhalin Island. The terrestrial pipelines were trenched through over 1,000 streams and waterways, cutting into vital salmon spawning grounds.

    As somebody who took part in the construction of these pipelines, I can categorically say that this is bollocks of the highest order. However, anyone concerned by the depletion of the Sakhalin salmon stocks might want to look at the practices of the fish mafia, who use 25t cranes to lift their nets from the mouths of the streams and take their catches away in a convoy of trucks.

    In fact, my quick google search indicates that the biggest problems in Sakhalin come from the Western oil companies:

    My not-so-quick drive around Sakhalin in a Ural truck indicated that the biggest problem in Sakhalin comes from Rosneft oilfields pissing oil into streams which the government ignores only once SEIC has gone to the trouble of proving that it is not their product. And isn’t it strange how the Sakhalin environmental concerns disappeared the moment Gazprom took over the keys to the Sakhalin II project?

    Comment by Tim Newman — March 25, 2013 @ 1:36 pm

  31. @Tim

    I agree completely with the facts you site and have often bemoaned the double standard but at the same time Western Companies should (and have) held themselves to a higher standard. There was once a claimed illegal dumping at Aniva Bay that was complete balderdash (I think this is the incident Vlad refers to). Aniva Bay can become oxygen depleted in the winter when ice cover is sufficiently great and this does cause a fish kill-not that uncommon. The fish kill that was claimed to result from illegal dumping was actually do to ice cover and anoxic conditions. There was no illegal dumping associated with the incident.

    I saw the regulatory hashashin Mitvol recently had his house raided by federal police. I guess the Kremlin could no longer tolerate his activities with respect to the Khimki Forest.

    Comment by pahoben — March 25, 2013 @ 9:06 pm

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