"A Wall of Money" to Hit Russia
On Monday, December 10, Vladimir Putin announced that he is supporting Dmitry Medvedev for the Russian presidency by saying, "I have known him for more than 17 years, I have worked with him very closely all these years, and I fully and completely support this candidacy." Dmitry Medvedev is chairman of the board for the state-owned natural gas monopoly OAO Gazprom and serves as Russia's first First Deputy Prime Minister, where his duties have included directing key domestic social programs, including efforts to improve housing and health care. The UK Times Online writes that, "Vladimir Putin rejects hardliners to anoint Dmitri Medvedev [who] would be the youngest Kremlin leader since Tsar Nicholas II. Russia's stock market reached a record high after the announcement."
Dmitry Medvedev, born on September 14, 1965, is perhaps the most liberal and business-oriented official in President Putin's administration. The International Herald Tribune is reporting that President Putin's decision is expected to give a major boost to the economy. "As if to underline the point, today Russia's main stock index soared on the political news." Unlike the American presidential candidates, the Russian candidates will have only a short time frame for their election campaigns, with Russia's presidential elections taking place on March 2, 2008.
According to the Yuri Levada Center, as of January 2007, 33% of Russian voters were willing to support Medvedev's candidacy in the first round of the elections, and, assuming that there were a second round, 54% would vote for him again. With Russian approval ratingsfor Putin hovering at close to 80%, just 41% of Russian voters are willing to support Putin's handpicked candidate, while 12% of Russian voters are explicitly going to vote against the United Russia Party nominee. Among Western corporate executives active in Russia, Dmitry Medvedev is widely seen as the preferred presidential candidate, as Medvedev is known for his executive acumen, his liberalization of Russia's gas market, and an outstanding career in law and business.
Please click the extended post to learn more about Dmitry Medvedev's biography and read about the possible financial outlook for Russia related to the new endorsement.
Dmitry Anatolyevich Medvedev (Russian: Ð”Ð¼Ð¸Ñ‚Ñ€Ð¸Ð¹ ÐÐ½Ð°Ñ‚Ð¾Ð»ÑŒÐµÐ²Ð¸Ñ‡ ÐœÐµÐ´Ð²ÐµÐ´ÐµÐ²) was born September 14, 1965 in Leningrad) in the family of university professors.
Medvedev graduated from the Leningrad State University with a law degree in 1987 and in 1990 received his PhD in private law from the same university. In 1990 he started to work for the City of Leningrad, pursuing many other occupations. Between 1991 and 1999 he taught at his old university, now renamed Saint Petersburg State University. In 1994 Dmitry Medvedev started his own legal practice (Consulting Firm "Balfort"). In 1991 - 1996 Medvedev also worked as a legal expert for the Committee for External Relations of the Saint Petersburg Mayor's Office under Vladimir Putin.
In November 1993, Medvedev became the legal affairs director of Ilim Pulp Enterprise, a St. Petersburg-based timber company. In 1998, he was elected a member of the board of directors of the Bratskiy LPK paper mill. He worked for Ilim Pulp until 1999.
In November of 1999 he became one of several people from St. Petersburg brought by Vladimir Putin to top government positions in Moscow. In December of the same year he was appointed deputy head of presidential staff.
Medvedev became one of the politicians closest to President Putin during the 2000 elections when he was head of the presidential election campaign headquarters. From 2000 to 2001, Medvedev was chair of Gazprom's board of directors. From 2001 to 2002 he was deputy chair of Gazprom. In June 2002, Medvedev became chair of Gazprom board of directors for a second time. In October 2003, he replaced Alexander Voloshin as a presidential chief of staff. In November 2005, he was appointed by President Vladimir Putin as First Deputy Prime Minister, First Deputy Chairman of the Council for Implementation of the Priority National Projects under the President of the Russian Federation, and Chairman of the Council's Presidium. Dmitry Medvedev is considered a moderate liberal pragmatic and an able administrator loyal to President Putin.
Dmitry Medvedev is married and has a son named Ilya (born in 1996). His wife, Svetlana Medvedeva was his high school sweetheart. They wed in 1982 after their graduation from secondary school. Dmitry Medvedev is also one of the authors of a university textbook on Civil law first published in 1991.
Medvedev Seen as Friendly to Business in Russia
The Associated Press
Monday, December 10, 2007
MOSCOW: Vladimir Putin's decision Monday to back the Gazprom chairman, Dmitri Medvedev, as his successor as Russia's president was expected to give a boost to the economy, analysts said Monday. The country's main stock index soared as if to underline the point.
Troika Dialog, a Russian investment bank, said the nomination could lure a "wall of money" into domestic stocks and lift indexes by 20 percent by year- end. Also on Monday the Russian government raised its economic growth forecast for the next three years.
Putin, who enjoys approval ratings of more than 80 percent, said on state television Monday that he "completely" supported Medvedev in the March presidential poll. Putin's United Russia party, which won 64 percent of the vote in the Dec. 2 vote for parliament, said it will officially nominate Medvedev, a former chairman of Gazprom, on Dec. 17.
Gazprom, the biggest natural gas company in the world, and state-run lenders Sberbank and VTB Group will be among the biggest beneficiaries of Putin's decision to support Medvedev, Troika Dialogue said. As Gazprom chairman, Medvedev imposed big gas price rises on Russia's former Soviet neighbors and masterminded a campaign to force Royal Dutch Shell to sell a controlling stake in a giant natural gas project to Gazprom at a knockdown price. Gazprom's shares rose XX rubles, or 2.2 percent, to a record 355.53 rubles, or $14.56, on the Micex Stock Exchange.
"Since Medvedev was behind liberalizing the gas market, he will do a lot of good for the company in the future," said Alexander Zakharov, deputy head of equities at Moscow-based Metropol.
Novatek, the gas producer, rallied XXX rubles, or 4.6 percent, to 184.63 rubles, the biggest advance in months. VTB climbed XXX rubles, or 3.9 percent, to 12.18 kopeks, the biggest gain in more than two months. It announced a rise in profit Monday. Russia's two main equity indexes topped their prior records set Nov. 8. The ruble-based Micex Index advanced 1.7 percent to 1,945.53, while the dollar- denominated RTS Index climbed 2 percent to 2,330.45.
The RTS has climbed 21 percent this year, trailing the 40 percent gain of the MSCI Emerging Markets Index, a lag some analysts said was due in part to political uncertainty over Putin's succession.
"This news is likely to encourage a wall of money to hit Russia," Kingsmill Bond, Troika's chief strategist, said, "Medvedev is the best possible candidate from the perspective of the market."
That "reveals a dramatic transnationalization of Russian firms," the study said. Over the past two years, the top 25 Russian companies' aggregate foreign assets more than doubled, growing at a faster rate than the world's 25 leading multinational companies, according to the study. More than half the foreign assets owned by the top Russian multinational companies are owned by natural resources industries such as oil, gas and metals, the study showed. Only 8 percent belonged to manufacturing companies, a reflection of how Russia's natural resources industries have soared while the manufacturing sector remains underdeveloped.
"Russian companies started to establish foreign affiliates much later than their competitors. However, the top multinationals are quickly expanding their role - with all the accompanying risks, opportunities and new requirements both for their business and economic policy," Skolkovo research director Valery Sorkin said. Russia's Economy Ministry Monday raised its industrial output forecast for the next three years, Interfax quoted Economy Minister Elvira Nabiullina as saying on Monday. Nabiullina said at a meeting with Putin that industrial output growth was now expected to reach 5.7 percent in 2008, 5.5 percent in 2009, and 5.6 percent in 2010. The previous forecasts were 5.2, 4.9 and 5.2 percent, respectively. "We have assessed the efficiency of investment growth in 2005-2007. This growth contributes to increasing industry competitiveness and creates potential for imports replacement in 2009- 2011," Nabiullina said.
Last week, the Economy Ministry raised its forecast for gross domestic product growth until 2010, while the Finance Ministry revised its outlook for consumer price growth. Medvedev's aspirations were apparent in a speech he made last month at the World Economic Forum in the Swiss resort of Davos. "The Russian economy will not only realize our historical mandate of the Euroasian energy and transport center," he said. "We will also restore our position as one of the largest scientific centers and turn our financial market into one of the most efficient and popular markets in the world."
Click on the links below to read previous Russia Blog posts about Mr. Medvedev: