Divide and Conciliate
// The Sochi Olympics will have at least three bosses
Russian President Vladimir Putin has rejected the idea of concentrating all preparations for the Olympic Games in a single organizing committee. Nor will he personally supervise the process. A three-headed management structure will have the authority to organize the Games, with several officials of Olympic stature involved. Minister of Economic Development and Trade German Gref presented one of those heads yesterday: an state Olympic corporation with capital of at least $7.5 billion for the state Olympic construction projects.
The government and presidential administration have begun creating structures to make preparations and carry out the 2014 Olympic Games in Sochi. On Friday, Russian President Vladimir Putin held a meeting on the matter. Leonid Tyagachev, president of the Russian Olympic Committee, confirmed for Kommersant that the meeting took place and that a tripartite management structure was approved to manage projects in Sochi. “The functions of state bodies will be determined more fully at the presidential council on fitness and sports in September,” Tyagachev said. He emphasized that no personnel decisions for managing the Sochi 2104 project had been made yet. Several other officials who are familiar with the results of the meeting with the president told Kommersant that he asked that his direct involvement in the Olympic structures be avoided and that he refused to approve a plan for unitary management of all preparations for the Games.
Kommersant has learned that the original idea of creating a unified Olympic organizing committee for the 2014 Sochi Games (as was done for the Olympic Games in Atlanta in 1996, Salt Lake City in 2002 and Athens in 2004) led to fierce fighting for the position of committee head. Various sources have identified Deputy Prime Minister Alexander Zhukov, presidential business manager Vladimir Kozhin, Alfa Bank president Petr Aven, chairman of the Russian 2014 Olympics bid committee Dmitry Chernyshenko and many others had set their sights on that position. Now, with a tripartite management structure, there will be many more positions to compete for.
Economics Minister Gref announced the name of one of the main of one of those three heads of Russian Olympic organization at the meeting yesterday in Sochi. The Olympic Corporation of Russia will be created in October and November of this year as a state corporation to serve a unitary government customer and operator for Olympic facilities. There are three state corporations being set up in Russia now: Rosnanotekh (for the development of nanotechnology), Development Bank-Vneshekonombank (for state investment) and the Fund for the Support of Housing Reform. Federal State Unitary Enterprise Rosoboronexport is also seeking state corporation status. The status of state corporation, a noncommercial partnership, means not being subordinate to the government and comes with tax benefits.
Kommersant has obtained a transcript of the presentation of the organizational model for preparations for the 2014 Olympics. It was created for the Economics Ministry by the Regional Policy Institute, the Vegas Lex law firm and the National Institute on Competitiveness. Due to the need to place all construction projects in the same hands, which would be impossible in the massive structure of the organizational committee, he a number of functions have been separated from it. None of the drafters of the plan would comment on it.
Private investors are supportive of the idea of separating construction in Sochi from the Olympic state corporation. Basic Element spokesmen called the idea “sound” yesterday, saying that coordination of construction is a weak spot in Olympic preparations. Another private investor in Sochi explained to Kommersant that “Before, the signature of a regional official on a document cost a bottle of cognac. Since July 2007, it has cost tens of thousands of dollars. I hope it will be simpler after the creation of the state corporation – there are facilities to build.”
Deputy Prime Minister Alexander Zhukov, who, according to what Kommersant has learned, was inclined toward coordinating the projects within a unified organizing committee, is likely to be made the head of the organizing committee. It will work with the International Olympic Committee and the Russian Olympic Committee and will be the political authority in the project. “The organizing committee will handle the political and ideological problems of Olympic preparations,” a government source said. “One of the deputy prime ministers may have the post of chairman delegated to him. The political construct suggests that the post will be a sinecure, but it may mean temporary exile from the government for its holder.”
The financial authority will be the Olympic state corporation. Its head has not been chosen. Sources familiar with the situation mention Nizhny Novgorod Region Governor Valery Shantsev, director of the federal state unitary enterprise Unified Direction for the Implementation of the Development of Sochi as a Mountain Resort (2006-2014) Federal Target Program Vladimir Afanasenkov and even Gref himself or Deputy Economics Minister Vitaly Savelyev, as well as Kozhin and Aven. Financing by the authorities of the federal program, whi9ch was approved at 313 billion rubles, including 185.8 billion rubles from the federal budget, is now to go into the authorized capital of the state corporation. Thus, its leader will manage on organization with capital of over $5.5 billion.
The third head of the Olympic preparations will be a government coordinating committee on holding the Olympics that will be subordinate simultaneously to the government and the president. It will coordinate the work of government agencies during preparation for the Games. Dmitry Chernyshenko is favored for that post. It is also possible that the post will interest other officials as well. Sources who claim to know the contents of the discussion at the meeting with the Russian president say that Deputy Prime Minister Sergey Naryshkin and Kozhin are interested in the job, as are people connected to chief of the presidential executive staff Sergey Sobyanin.
The tripartite structure will allow the number of Olympics-related positions to be increased, thus reducing competition for them. The interests of private investors (Interros, Basic Element, Gazprom and others) and other federal and regional authorities and so on have to be considered too. The fight for the Olympics will continue through December, when, according to Gref, a special Olympics law will be passed in which the final lineup of Olympic leaders will be confirmed.
Dmitry Butrin, Yulia Taratuta, Elena Kiseleva, Maxim Shishkin, Petr Netreba
All the Article in Russian as of Aug. 15, 2007
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