Digest of headline news as of 3:35 p.m. Moscow time on June 14:
BUSINESS & FINANCE
*** RUSSIAN-KYRGYZ TRADE UP 31% IN 2017, TENDENCY CONTINUING - PUTIN
Russian President Vladimir Putin reiterated the need to further boost bilateral trade between Russia and Kyrgyzstan at a meeting with his Kyrgyz counterpart Sooronbai Jeenbekov in Moscow on Thursday.
"Our bilateral trade grew 31% last year, and this positive tendency is continuing. All steps need to be taken to make sure that it will be maintained in the future," Putin said.
*** ECON MIN EXPECTING RUSSIAN INFLATION AT 0.3%-0.4% IN JUNE
Russian inflation is expected at 0.3%-0.4% in June 2018, reducing annual inflation to 2.1%-2.2%, due to a high base in June 2017, the Economic Development Ministry said in a report on inflation.
"The weakening of the ruble in recent months has not led to a visible acceleration in the growth of consumer prices. Inflation in May remained at the same level as in March and April at 2.4%, in consistent increments of 0.4% a month. If some acceleration in price growth for certain items of the consumer basket, which are more sensitive to forex fluctuations, was observed in April, then already in May the price dynamics for the majority of such goods and services had normalized," the report said.
*** RUSSIAN FEDERAL BUDGET COULD REMAIN IN SURPLUS IN 2019 SHOULD CURRENT OIL PRICES PERSIST - SILUANOV
The Russian federal budget could remain in surplus next year if current prices for oil and gas persist, First Deputy Prime Minister and Finance Minister Anton Siluanov said in a briefing following a Cabinet meeting.
He said that the Finance Ministry has included a surplus of 0.5% of GDP into the 2018 budget.
"This could be even higher should prices for our export goods persist. The surplus could be maintained next year as well if prices for oil and gas are the same as they are now," he said.
*** INCREASING VAT TO 20% FROM JAN 1, 2019 TO BRING IN OVER 600 BLN RUBLES ANNUALLY FOR BUDGET - SILUANOV
A VAT increase from 18% to 20% will generate more than 600 billion rubles in additional annual budget revenues, First Deputy Prime Minister and Finance Minister Anton Siluanov said, speaking at a Cabinet meeting on Thursday.
"This step will lead to additional federal budget revenue of more than 600 billion rubles annually starting next year. These funds, in conjunction with additional revenues from the conclusion of the tax maneuver, will be the primary source for financing national development goals set by the president in May of this year," Siluanov said.
*** RAISING VAT WILL ADD UP TO 1.5 PERCENTAGE POINTS TO INFLATION, COULD GO SLIGHTLY OVER 4% IN 2019 - SILUANOV
Raising VAT to 20% from its current 18% will cause inflation to accelerate, but will add no more than 1.5 percentage points to it, First Deputy Prime Minister and Finance Minister Anton Siluanov said at a briefing follow a Cabinet meeting.
He said that if inflation is around 3% in 2018, then it will be "4% to slightly over 4%," in 2019.
*** RETIREMENT AGE COULD START TO BE INCREASED IN 2019 - MEDVEDEV
The Russian government proposes to introduce a transition period for increasing the retirement age in 2019, Prime Minister Dmitry Medvedev said at a Cabinet meeting.
"It is proposed to introduce a fairly lengthy transition period," he said.
"It is proposed to launch it in 2019, so that a retirement age of 65 is reached for men in 2028 and 63 for women in 2034," he said.
*** MEDVEDEV: CHANGES TO PENSION AND TAX SYSTEMS OVERDUE
Changes to the pension and tax systems are long overdue, and without them, Russia will not be able to advance in development of the social sphere and the economy, Prime Minister Dmitry Medvedev said at a Cabinet meeting on Thursday.
"We all understand that these changes are overdue, they are necessary. They are long overdue. In the absence of these solutions, we will be unable to move forward in raising people's living standards, in the social sphere and in development of the economy," Medvedev said.
The government understands "how difficult all these decisions are," he said.
*** PENSION REFORM WILL HELP BALANCE LABOR MARKET - MEDVEDEV
Proposed measures as part of pension reforms will not only increase pensions, but also balance the labor market, which is experiencing a lack of manpower, Russian Prime Minister Dmitry Medvedev said.
"The measures adopted will allow for pensions to be raised as well as giving the opportunity to further balance the labor market. We already have record low unemployment and in the mid-term, we could absolutely be faced with the situation where we don't have enough labor resources," Medvedev said at a Cabinet meeting to discuss pension reform.
He said that "there is already a shortfall in a number of regions."
*** COURT SEIZES SHARES OF 13 SUMMA-OWNED COMPANIES - MOSCOW CITY COURT
Moscow's Preobrazhensky District Court has seized shares of 13 various companies incorporated in Summa Group as part of a criminal case against the co-owners of the holding, Ziyavudin and Magomed Magomedovs.
"The district court has seized shares of the companies, which, as investigators believe, are owned by Summa Group," spokeswoman of the Moscow City Court Ulyana Solopova told Interfax.
This concerns 13 various companies, including regional ones, she said.
*** RUSSIAN, SAUDI ENERGY MINISTERS TO ATTEND PUTIN'S MEETING WITH SAUDI CROWN PRINCE - KREMLIN
Russian Energy Minister Alexander Novak and his Saudi counterpart Khalid Al-Falih will attend an upcoming meeting between Russian President Vladimir Putin and Saudi Arabia's Crown Prince Mohammad bin Salman, Russian presidential press secretary Dmitry Peskov told reporters on Thursday.
"Yes, he will be there. I mean Novak, but Al-Falih will be there too. But it is up to our Saudi partners to speak about him," Peskov said when asked whether the two countries' energy ministers would attend the talks between Putin and the Saudi crown prince.
*** GAZPROM SECURES STAY ON EXECUTION OF STOCKHOLM ARBITRATION RULING ON TRANSIT CONTRACT
Sweden's Svea Court of Appeal has granted a request by Gazprom and ruled on June 13 to bring a halt to the execution of the Stockholm arbitration ruling from February 28, 2018 in the dispute between Gazprom and Naftogaz Ukrainy regarding the contract on gas transit through Ukrainian territory, the Russian gas giant said in a statement.
Gazprom filed the request on June 7, 2018 in connection with the appeal of the arbitration decision on the transit contract and attempts by Naftogaz to initiate compulsory execution of this decision in various jurisdictions prior to the consideration of the appeal on its merits.
"The appeals court agreed that there are sufficient grounds to halt the execution of the Stockholm arbitration decision. The issuance of the decree deprives Naftogaz Ukrainy of, among others things, the grounds for attempts to freeze Gazprom assets abroad. These circumstances will be used by Gazprom to appeal the actions of court bailiffs in Switzerland and the Netherlands," the statement said.
*** GAZPROM SCRAPS GBP BOND OFFERING DUE TO RISK OF PROCEEDS BEING FROZEN BY NAFTOGAZ
Gazprom has canceled a planned Eurobond offering in pounds sterling set for the middle of June due to the risk of the funds raised being frozen by Naftogaz Ukrainy, a source with knowledge of the situation told Interfax.
Naftogaz gas already undertaken several legal steps with a view to seizing subsidiaries of Gazprom and their assets in Switzerland and the Netherlands, and there have been reports of plans to freeze assets in Britain and the United States.
*** GAS TRANSPORT TARIFF INDEXATION FOR INDEPENDENTS IN DISCUSSION STAGE - GOLOMOLZIN
The issue of indexing the tariffs charged for gas transport for independent producers is in the discussion stage, Federal Antimonopoly Service (FAS) deputy head Anatoly Golomolzin told journalists.
"Yes, the question is in the discussion stage," he said when asked whether a decision to alter the tariff was planned this year.
Asked when a draft order on the matter would appear, Golomolzin said he could not provide an exact date, but expects that to happen this summer.
*** PASHINYAN AND KOSTIN DISCUSS EXPANSION OF VTB BUSINESS IN ARMENIA
Armenian Prime Minister Nikol Pashinyan considers VTB's presence in the country's financial market and the lender's active investment activities in various spheres of the Armenian economy of great importance.
In a meeting with VTB chief Andrei Kostin in Moscow on Thursday, Pashinyan presented the new Armenian government's plan for economic development and stated the importance of a corresponding reaction to these impulses from business, the government press service said in a statement.
According to the statement, Pashinyan and Kostin discussed the expansion of the lenders' business in various spheres of the Armenian economy.
POLITICS & SOCIETY
*** PUTIN, PARAGUAYAN PRESIDENT-ELECT DISCUSS BILATERAL RELATIONS
President Vladimir Putin has said he expects the Russian visit of Paraguayan President-elect Maria Abdo Benitez to boost bilateral relations.
"I hope that the time you have spent in Russia will incite your relevant and right emotions and good mood and become an incentive for developing our contacts," Putin told Benitez at a meeting.
He congratulated Benitez on winning the election and said he planned to discuss the development of relations between Russia and Paraguay.
*** PESKOV CONFIRMS KREMLIN'S STANCE: 2018 FIFA WORLD CUP OUT OF POLITICS
The FIFA World Cup in Russia remains separate from politics, reproaching Russia for racism and homophobia has nothing in common with it, presidential press secretary Dmitry Peskov said.
"You know that all the countries are reproaching each other for racism, homophobia and so on. All these reproaches have nothing to do with the World Cup," Peskov told reporters on Thursday.
"It was yesterday when Putin said that football is and remains out of politics, and it is extremely important," the presidential press secretary said.
*** PUTIN PLANS TO HOLD INFORMAL MEETINGS WITH FOREIGN LEADERS ATTENDING WORLD CUP IN MOSCOW
Russian President Vladimir Putin will meet with foreign presidents and prime ministers who will attend the 2018 FIFA World Cup opening ceremony in Moscow on Thursday both on the sidelines of the tournament and in the Kremlin, Russian presidential press secretary Dmitry Peskov said.
Most of the upcoming meetings will be informal, he said.
"The president will attend the World Cup opening ceremony and the first match, where the Russian national team will play against Saudi Arabia's national team. We expect that the president will take advantage of this occasion to continue his quite active communication with his colleagues from other countries both on the sidelines of the match and possibly in the Kremlin, where he will continue informal discussions with guests from CIS countries," Peskov said.
*** SURKOV TO CONTINUE ADDRESSING DONBAS SETTLEMENT PROCESS - KREMLIN
Russian Presidential Aide Vladislav Surkov will continue addressing the Donbas settlement after his reappointment, presidential press secretary Dmitry Peskov told reporters on Thursday.
"Yes," Peskov said, when asked whether Surkov "would still be dealing with Donbas."
*** PUTIN SIGNS DECREE ON MEASURES TO OPTIMIZE KREMLIN ADMINISTRATION STRUCTURE - KREMLIN
Russian President Vladimir Putin has signed a decree on measures to optimize the presidential administration structure, presidential press secretary Dmitry Peskov told reporters.
In addition, Putin by his decree has introduced some changes to several Russian presidential acts. This decree specifically approves the regulations on the presidential directorate for information and communications technologies development, Peskov added.
*** KIRIYENKO'S POWERS IN KREMLIN ADMIN BROADENED, HE NOW OVERSEES FOUR DIRECTORATES INSTEAD OF TWO - DECREE
Russian President Vladimir Putin has broadened the powers of presidential administration first deputy head Sergei Kiriyenko.
The decree on measures to optimize the structure of the presidential administration broadens the list of Kiriyenko's functions, putting him in charge of overseeing the presidential administration's directorate for supporting the activities of the State Council and also the directorate for the development of information and communications technologies and communications infrastructure.
*** N. KOREA PROBLEM CANNOT BE SOLVED WITHOUT RUSSIA - RYABKOV
Russia needs time to draw conclusions about the Singapore summit between the United States and North Korea and believes that problems of the Korean Peninsula could not be resolved without the active involvement of Moscow, Russian Deputy Foreign Minister Sergei Ryabkov told reporters in Moscow on Thursday.
"Of course, we have contacts [with North Korea and Japan]. One of the top-ranking North Korean officials is visiting Moscow today, we are receiving information from various sources and have no shortage of it," Ryabkov said in response to the question whether Russia was receiving enough information from partners, including North Korea and Japan, in regard to the North Korea settlement process.
"We believe that phased progress should be made in denuclearizing the Korean Peninsula; we have made relevant proposals in the bilateral format with the Chinese colleagues and in other formats. They remain on the table," Ryabkov said.
*** MOSCOW WORKING ON SUBSTANTIVE PART OF POSSIBLE RUSSIA-U.S. SUMMIT - FOREIGN MINISTRY
There is no news about the possible date and venue of a Russian-U.S. summit, Russian Deputy Foreign Minister Sergei Ryabkov told reporters in Moscow on Thursday.
"There is no such news," Ryabkov said.
For now, Russia is focused on "formulating a positive substantive part [of the summit] and preparing for this event the best it can," he said.
*** RYABKOV HOPES TO RESUME STRATEGIC STABILITY TALKS WITH UNITED STATES
Russia hopes to resume strategic stability negotiations with the United States and rapidly agree on the date and venue of the next meeting, Deputy Foreign Minister Sergei Ryabkov said.
"We also hope so," Ryabkov said in response to the statement by Anthony Godfrey, the Deputy Chief of Mission at the U.S. Embassy in Moscow.
Ryabkov reminded reporters that his vis-a-vis, Thomas Shannon, had resigned.
*** RUSSIA SEEKS TO JOIN NEW MODEL OF WORK WITH IRAN AMID U.S. SANCTIONS - RYABKOV
Russia wants to be included in a new model currently being negotiated between Tehran and the E3 that will make it possible to work with Iran following the renewal of U.S. sanctions against this country, Russian Deputy Foreign Minister Sergei Ryabkov said.
"We are insisting on our inclusion in all of the models and arrangements of work [to protect Iranian economic interests] in new conditions that may be agreed within the EU today. Certainly announcements on that score have already been made. And we will continue relevant consultations within the next few days both with the Europeans and Iranians. It will be one of the key issues," Ryabkov told reporters in Moscow when answering a question from Interfax.
"The protection of economic operators from the effect of extraterritorial sanctions' application is now our top priority," he said.
*** RUSSIAN FOREIGN MINISTRY TO GIVE MAXIMUM SUPPORT TO SOVFRACHT - RYABKOV
The Russian Foreign Ministry will provide comprehensive support to Sovfracht, which has fallen under the new U.S. sanctions, Deputy Foreign Minister Sergei Ryabkov said.
"Sovfracht is a public joint stock company. We have seen the statement by the company's management declaring the intention to appeal to a U.S. court. As the ministry, we will give them maximum support, in particular, will share our observations and opinions on what is really going on in this area at the U.S. establishment," Ryabkov told reporters in Moscow on Thursday.
*** RUSSIA NOT TO LEAVE ENLARGEMENT OF U.S. CONTINGENT IN NORWAY UNANSWERED - EMBASSY
Russia is seriously concerned about the enlargement of the U.S. military contingent in Norway; this is an unfriendly step, which will have consequences, the Russian embassy in Norway wrote on Facebook.
"We have repeatedly commented on the enlargement of foreign military presence in Norway. The situation has not changed: Vernes in central Norway, Rygge in southern Norway, and Setermoen in northern Norway, all those steps cause our profound concern," the embassy said.
Decisions of the kind directly contravene the pledge made by Norway in 1949 "not to provide bases for foreign forces in the Norwegian territory until Norway is attacked or faces the threat of attack," the embassy said.
*** ABE, KIM MAY MEET IN VLADIVOSTOK IN SEPTEMBER - DUMA DEPUTY
The State Duma Foreign Affairs Committee supports the idea to arrange a meeting between Japanese Prime Minister Shinzo Abe and North Korean leader Kim Jong Un on the sidelines of the Eastern Economic Forum in Vladivostok.
"I believe this is possible. This is a good perspective. And I am sure that Vladivostok will give a proper welcome to both our guests," Foreign Affairs Committee First Deputy Chairman Dmitry Novikov told Interfax on Thursday.
"They have things to discuss," Novikov said.
*** TCG FOR DONBAS FAILS TO SIGN DOCUMENT ON EXTRA SECURITY MEASURES
The participants in a recent meeting of the security subgroup of the Trilateral Contact Group (TCG) for Donbas in Minsk did not make any progress towards signing a document on additional security measures, a representative of the self-proclaimed Donetsk People's Republic (DPR) at the Joint Center for Control and Coordination (JCCC) told reporters.
"The group's work was focused on discussing additional measures to control the security situation on the sides' contact line... Unfortunately, no progress was made this time towards adopting a document with additional measures that would make it possible to effectively respond to violations. Apparently, the signing of such a document is unfavorable to the Ukrainian side," he said.
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