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U.S. Slams Russia, Uzbekistan on Trafficking; The First Female Czech Premier?

Plus, Russia is set to ink a massive Chinese oil deal and to take over Armenia's natural gas industry.

by S. Adam Cardais, Ioana Caloianu, and Vladimir Matan 21 June 2013

1. U.S. human trafficking report singles out two post-Soviet states
Russia and Uzbekistan are among the world’s “worst of the worst” human trafficking offenders, according to the U.S. Department of State.
In its Trafficking in Persons Report 2013, the State Department downgraded the post-Soviet states to its Tier 3 list of countries that neither comply with minimum standards for the elimination of trafficking nor are trying to do so. The U.S. government might withhold foreign aid to these and other basket-case countries as a result.
In Russia, labor trafficking remains the key problem, according to the report, with more than 1 million people facing abuse, poor living conditions, and other labor exploitation consistent with trafficking cases. In April 2012, for instance, migrant workers from Central Asia were killed when a fire swept through a Moscow warehouse because they were effectively trapped in the building. Russian women and children are also the victims of sex trafficking at home and abroad.
For nine straight years, Russia had been on the department’s so-called Tier 2 Watch List. It was downgraded this year for failing to adequately follow through with a plan to get serious on tackling trafficking. Among its many recommendations, the report urged Moscow to establish national procedures to identify trafficking victims.
In Uzbekistan, the government internally traffics citizens to work in the annual cotton harvest, where a voluntary work force is nearly impossible to muster because the government sets quotas for national cotton production and then pays farmers below-market prices. Uzbeks are also pressed into labor in Kazakhstan, Russia, and Ukraine in the agriculture, construction, and other industries. Sex trafficking is widespread.
Like Russia, Uzbekistan was downgraded after years on the watch list. The State Department notes that Uzbekistan is one of the only governments in the world that, as a matter of state policy, subjects its citizens to forced labor.
For its part, Moscow called the report politically biased and said it wouldn’t take the downgrade lying down.
“Unfriendly steps will entail proportionate retaliation,” said Konstantin Dolgov, the human rights commissioner at the Foreign Ministry, Radio Free Europe reports.
2. Putin: Russia, China preparing $60 billion oil deal
Months after becoming the world’s largest oil company, Russian state-owned Rosneft is about to sign a $60 billion supply deal with China, President Vladimir Putin announced 20 June, Reuters reports.
This would mark a significant shift, according to the news agency, in Russia’s oil exports from Europe to Asia.
“A large-scale contract, without any exaggeration, has been prepared by Rosneft,” Putin said at a meeting with Chinese officials at a St. Petersburg economic forum. “Supplies to China are expected in volumes of hundreds of millions of tons of oil.”

Russian President Vladimir Putin meets with Zhang Gaoli, a deputy prime minister of China, at the St. Petersburg Economic Forum on 20 June. Photo from the Kremlin website.


Putin also called the deal unprecedented, according to RIA Novosti.
Meanwhile, an anonymous Rosneft source told Reuters the deal is part of a March agreement by Rosneft to increase supplies to China. At the time, company President Igor Sechin said they could be tripled.
Rosneft became the world’s largest public oil company in March, after acquiring the lucrative but long-troubled Anglo-Russian oil joint venture TNK-BP. Its output exceeds ExxonMobil’s.
In St. Petersburg, Putin said he also wanted to increase cooperation between China and state-owned gas giant Gazprom and Novatek, a private Russian gas firm. Recently, Gazprom’s core export market, Europe, has been so undermined by falling demand and new competition that some analysts see bankruptcy on the horizon.
3. After leadership shakeup, Czech ruling party nominates first woman premier

The Civic Democrats have nominated Parliament Speaker Miroslava Nemcova as prime minister to succeed Petr Necas, who resigned this week amid a corruption scandal, the Czech News Agency reports.

Miroslava Nemcova
While other candidates had been mentioned, the center-right party voted for Nemcova 19 June, Civic Democrat acting head Martin Kuba announced. She must now be approved by the government coalition’s two junior partners, President Milos Zeman, and parliament to become the country’s first woman premier, Bloomberg reports.
Zeman, however, has said he might exercise his authority to call early elections, favored by the opposition Social Democrats, which he once led. The Civic Democrat-led government has suffered amid a flagging economy, austerity, and several corruption scandals that came to a head with Necas’ resignation 17 June after the arrest of his top aide in the country’s biggest anti-corruption operation in two decades.
The aide, Jana Nagyova, stands accused of bribing officials, among other charges, and three other members of the Civic Democratic party also face charges following a series of extraordinary police raids last week.
Nemcova, 60, said the decision to accept the nomination was not easy, and that she is “fully aware of the critical, difficult situation of the Czech Republic,” Bloomberg reports. A former bookstore owner, she has over a decade of legislative experience and has led the lower house of parliament since 2010, when Necas took power.
The Civic Democrats’ coalition partners, TOP 09 and LIDEM, have given verbal support to Nemcova. She was scheduled to meet with Zeman on 21 June to press the government’s case for her premiership over early elections.
4. Russia aims to tie up Armenia through Gazprom
Russian energy giant Gazprom wants to buy the Armenian gas distribution company, a move analysts say is the Kremlin’s way of roping Yerevan closer to Moscow, writes.
The Armenian government is in talks with Gazprom over selling its 20 percent share in the country’s natural gas distribution company, ArmRosGazprom, state officials announced 17 June, according to Natural Gas Europe. Gazprom is a majority stakeholder in ArmRosGazprom and seeks to control all of its shares.
Armenian Energy Minister Armen Movsisyan discussed cooperation between the two countries in the natural gas industry during a visit to Moscow this week. He met with Gazprom’s chairman but said any decision would need to be approved by the parliament, Business New Europe writes. The government is negotiating with Gazprom over the size of a planned rate hike for gas supplies.
Gazprom recently announced plans for a 60 percent increase in gas export prices to Armenia. An 18 percent increase was eventually agreed, reports.
Observers say the move is part of Russia’s attempt to extend its influence in the region. Moscow wants Armenia to join the Eurasian Union, a Russia-led answer to the European Union. Selling its share in the gas company would leave Yerevan little maneuvering space when dealing with Moscow, but it has few options. It is technically at war with energy-rich neighbor Azerbaijan, and Iran lack the infrastructure to deliver enough gas to Armenia anytime soon.
Brussels has warned Armenia that its membership in the Eurasian Union would jeopardize its trade and integration aspirations toward the EU.


5. Hungarian premier who ‘cut the Iron Curtain’ dies at 80
A former Hungarian prime minister widely seen as one of the architects of the fall of the Iron Curtain died on 19 June aged 80, according to Bloomberg. Gyula Horn was best known for the symbolic gesture of cutting the iron fence separating communist Hungary from Austria in June 1989 while serving as the country's foreign minister. The moment celebrated the opening of the Iron Curtain border between the two countries, which allowed thousands of East Germans to cross into Austria and then join their West German relatives. German Foreign Minister Guido Westerwelle said in a statement that Horn “ensured his place in the history books” through his role in the event.
Bloomberg writes that the 1989 ceremony had more theatrical than actual significance, as the two countries had already disassembled their physical border. “They actually had to rebuild the fence on a 200-meter section so that they’d have something to cut through,” said Miklos Nemeth, a former Hungarian prime minister. He said the gesture was important as a “further test” of the Soviet Union's tolerance for the reforms sweeping the region. Horn was in a better position to know the Soviet stance, given that, according to his own statements, he had already met and discussed the upcoming reforms with then-Soviet leader Mikhail Gorbachev, who gave his approval.
Born into a poor Budapest family, Horn had initially taken a pro-Soviet stance and joined militia forces in crushing Hungary’s 1956 uprising. He distanced himself from communist ideology later in life, which he labeled “anti-democratic, against achievement and performance.” He also played an important role Hungary’s post-1989 history, when he served as a prime minister from 1994 to 1998 and pushed for the introduction of free-market reforms.

S. Adam Cardais is a TOL contributing editor. Ioana Caloianu is a TOL editorial assistant. Vladimir Matan is a TOL editorial intern.
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