Alexey Kudrin Sends the Dollar Down
Visit
Russian Financial Minister Alexey Kudrin attended sessions of the World Bank, the IMF and G7’s financial authorities late last week. The minister’s trip to Washington can be called extremely fruitful. He brought the dollar down against the euro, quarreled with IMF director Rodrigo de Rato, promised access to Russia’s strategically important oil reserves for American companies, announced solving the problem of the stabilization fund’s money and declared Russia would become the Great Seven’s full-fledged member in 2046 – 2056. The minister’s visit to the United States will be continued in New York today where he is expected to call at the New York Stock Exchange.
The U.S. dollar was down 45 points, to $1.2360 against ˆ1 late last Friday at the London Exchange. Sources of Kommersant in Washington unanimously attributed the decline to Alexey Kudrin’s statements. Coming for a session of G7’s finance ministers as an observer, the Russian finance minister started his U.S. visit by declaring that “the dollar is being volatile and cannot be considered a reserved currency for Russia.”
Alexey Kudrin arrived in Washington with favorable domestic Russian news at his disposal. He reported that Prime Minister Mikhail Fradkov finally signed a decree on procedures of investing money from Russia’s stabilization fund. It was obviously his viewpoint that was adopted as the fund is going to be put into foreign governments’ bonds. “It’s up for the Finance Ministry to choose among securities,” he said.
Reporter in Washington had a chance to estimate the true worth of Kudrin’s news-making abilities. The minister, for instance, said at a meeting at the Carnegie Center on Friday that Russia is ready to provide a partial access to its oil reserves for foreigners. This is how he commented on the enforcement of an upcoming law restricting foreign investments. “The Kremlin’s administration and the Russian government raised an issue of strategically important oil fields where a limited number of foreign companies and consortiums should allowed to take part,” he said. Alexey Kudrin noted, however, that “the share of Russian companies is going to be bigger than that of foreigners in the document which has not been drafted in full yet.” Apparently, the minister meant the Shtokman gas field.
Alexey Kudrin decided to half-open the Russian oil market for foreign investors following his talks with U.S. Treasury Secretary John Snow and former U.S. Trade Representative Robert Portman on Friday, according to the information Kommersant obtained. Mr. Portman confirmed at the meeting that “Russia will definitely enter the WTO by the end of 2006.”
Alexey Kudrin had three meetings scheduled for Saturday – the one with U.S Federal Reserve System’s chairman Ben Benanke, IMF Managing Director Rodrigo de Rado and World Bank President Paul Wolfowitz. For some reason, Alexey Kudrin violated the protocol of the meeting declining to shake hands with IMF Managing Director Robert de Rato before TV cameras. The Russian delegation went by the IMF’s director taking no notice of him, and Mr. Rodrigo nearly had to chase the Russian finance minister into the negotiations room to greet him there. Mr. Kudrin’s aides comment on the incident in quite an odd way. “The minister does not need this kind of publicity.” The Russian finance ministry’s delegation engaged the IMF and the World Bank into a discussion of a coming reform of functions and countries’ quotas of membership in these organizations.
A G7 badge on the left lapel of Alexey Kudrin’s suit hit the headlines as well. Mr. Kudrin admitted without scruples his observer status at the meeting of Great Seven’s finance ministers saying the “there is now the financial Great Seven,” while it actually turns into the Eight only when Russia hosts meetings. According to his forecasts, Russia will become the organization’s full-fledged member “in some forty or fifty years when Russia enters the top six of leading nations in terms of economy.” Alexey Kudrin accounted the downbeat prediction for researches of “major international investment companies.”
Making his latest news, Alexey Kudrin officially confirmed that he had received a summons from YUKOS’ shareholders to appear before the U.S. court. “There are lawyers who defend interests of the Russian government as well as my own interests because I am mentioned in this list alongside some other Russian officials. He said he does not know how he “happened to be listed there” but added he is confident the U.S court would “support the case of the Russian party.”
The U.S. dollar recovered climbing to $1.234 against ˆ1 on Sunday when Alexey Kudrin did not make any statements. The Russian finance minister is to fly to New York today to meet directors of the New York Stock Exchange.
Kommersant will track the development of events.
Dmitry Sidorov and Alexey Pekvo, Washington
All the Article in Russian as of Apr. 24, 2006
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