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. Last Updated: 07/27/2016

Nemtsov Will Oversee Gazprom

After lamenting the lack of state control over natural gas giant Gazprom, Russia's First Deputy Prime Minister Boris Nemtsov was named Tuesday to head a newly created board aimed at strengthening the government's influence over the company.


President Boris Yeltsin signed a decree Monday creating a 10-member board of state representatives which will exert greater control over the state's 40 percent stake in Gazprom.


Most of the government's shares in the company are personally managed by Gazprom chairman Rem Vyakhirev, under a trust agreement concluded in 1993. Nemtsov said Tuesday the trust agreement would be revised, as called for in Yeltsin's decree, within a month, Interfax reported.


Nemtsov declined to comment on how the agreement would be changed, but he has said Vyakhirev would have to coordinate management of the company with newly appointed state representatives.


In an interview on Russia's NTV channel Monday night, Nemtsov described the decree as a "breakthrough" which would bring Gazprom back under the government's wing. "The state had totally lost control of the company," he said.


Charging that the state had been shortchanged, Nemtsov said the government had received only 20 billion rubles ($3.5 million) in dividends over the past two years from its 40 percent stake in Gazprom. He said the state's representatives would ensure that the government gets the profits it is due.


Some analysts, however, said Nemtsov's complaint that the government had not shared the profits of the company appeared to be a populist move motivated by the budget crisis.


The board will also formulate the state's position in the management of Gazprom, press for reduced gas prices and force the company to pay its taxes on time, Nemtsov said.


Analysts dismissed the latest government moves against Gazprom, saying Nemtsov's paramount concern is making sure the company pays its $2.6 billion in back taxes as promised. "Nemtsov has done a good job of keeping a high profile, but this will have little impact on the bottom line," said one market analyst, who asked not to be identified.


The boardmembers include Economics Minister Yakov Urinson, the head of the State Tax Service Alexander Pochinok, First Deputy Finance Minister Alexei Kudrin, and Deputy Fuel and Energy Minister Anatoly Kozyrev, Reuters reported.


Yeltsin signed two decrees Tuesday, the first instructing the government and the Central Bank to complete the transition to a treasury system and set criteria for selecting authorized banks by Jan.1, 1998, Interfax reported.


The second decree bans government guarantees on commercial loans for federal budget purposes. The International Monetary Fund had made the ban a condition for resumed lending to Russia.