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FM AMEMBASSY MOSCOW
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INFO RUEHXD/MOSCOW POLITICAL COLLECTIVE
RUCNCIS/CIS COLLECTIVE
RUEHVK/AMCONSUL VLADIVOSTOK 2812
RUEHYG/AMCONSUL YEKATERINBURG 3161
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UNCLAS SECTION 01 OF 02 MOSCOW 001321 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PGOV PINR SOCI ECON RS
SUBJECT: Medvedev Names New Government 
 
MOSCOW 00001321  001.2 OF 002 
 
 
Summary 
------- 
 
¶1. (SBU)  In a government marked by experience and continuity, 
President Medvedev nominated a new cabinet today that leaves the 
"Zubkov" cabinet largely intact and our main interlocutors Sergey 
Lavrov at the Foreign Ministry and Finance Minister Kudrin at their 
posts.  Some of the more notable changes involved the move of 
Presidential Administration (PA) Head Sergey Sobyanin to Deputy 
Premier (most here had expected him to head Medvedev's 
administration); the promotion of presidential aide, Igor Shuvalov, 
to first deputy prime minister and the demotion of  Sergey Ivanov 
from that position to "just" a Deputy Premier; and the omission of a 
nominee for the Ministry of Economic Development on the Kremlin 
website list.  (Press reports suggest that Elvira Naibullina will 
stay on, but lose the trade aspect of her portfolio.)  In other 
developments, Minister of Justice Ustinov, Federal Security Service 
Head Nikolay Patrushev, and Federal Drug Control Service Viktor 
Cherkesov lost their jobs - suggesting a shake-up in the "silovik" 
camp - but Patrushev will move to the vacant Secretary of the 
Security Council.  If all ministerial candidates are confirmed by 
the Duma as expected, five new faces will join the government as 
well as three of Putin's top lieutenants from the PA.  Over the 
coming weeks, we will be looking in greater depth at the 
personalities involved as well as the government's new schema of 
organization.  End summary. 
 
Deputy Premiers: Rotation of Cadres 
-------------------------------------------- 
 
¶2. (SBU) Putin's new government will have at least seven deputies. 
After confirmation by the Duma, former Premier Viktor Zubkov and 
Igor Shuvalov - Putin's adviser on economic issues and WTO Sherpa - 
will serve as First Deputy Premiers.  According to press reports, 
Zubkov will manage the National Priority Project on developing 
agriculture, as well as having responsibility for government policy 
related to fishing, timber, and the agro-industry.  Shuvalov will be 
piloting economic policy, particularly foreign trade and the sphere 
of technical regulation.  He will continue to head Russia's efforts 
to join the WTO, oversee government policies to develop small 
business, fight monopolies and encourage competition, and the 
creation of a unified economic space.  Perhaps more important, 
analysts here see Shuvalov playing a critical role as the nexus 
between the Kremlin and the White House, managing paper flows 
between the two bureaucracies. 
 
¶3. (SBU) Sergey Sobyanin, Putin's former head of the PA, and Igor 
Sechin will move from the Kremlin to the White House.  The former 
will serve as the head of the government administration and will 
continue his work on assessing the effectiveness of executive organs 
and balancing the authorities between the federal, regional, and 
municipal layers of government.  Sechin's portfolio is concentrated 
on state industrial policy, excepting the energy and military 
industrial sectors.  He will also supervise government policies 
related to the use of natural resources, as well as oversight over 
ecological, technical, and nuclear monitoring.  Sobyanin's 
appointment to the government comes as a surprise to many here, 
since he, as the head of Medvedev's election campaign, was seen as 
the most likely candidate to lead Medvedev's PA.  (Medvedev today 
announced that he is picking Sergey Naryshkin, the former head of 
the government administration and Deputy Premier to take that role). 
 
 
¶4. (SBU) Aleksey Kudrin will remain as the dual-hatted Deputy 
Premier and Finance Minister, while Sergey Ivanov is demoted from 
First Deputy Premier, but stays in the government.  Kudrin's 
portfolio remains largely unchanged, heading policy on 
social-economic development.  He will oversee all financial matters: 
taxation, monetary policy, as well as the budget.  We do not yet 
know whether he and his staff will remain engaged on WTO issues. 
Aleksandr Zhukov likewise will stay in the government to oversee the 
other National Projects (excepting agriculture) and state policy for 
education, health, social security, culture and the arts.  He will 
also be responsible for government policy related to the 2014 Summer 
Olympics in Sochi as well as other aspects of sport, tourism, and 
physical fitness. 
 
Shake-Up in the Security Services 
----------------------------------------- 
 
¶6. (SBU) Perhaps the biggest surprises of the day came from 
appointments within the security services.  In addition to the 
replacement of Justice Minister Ustinov, Medvedev announced that 
both FSB head Patrushev and Federal Drug Control Service Cherkesov 
would lose their jobs.  The two have been involved in a behind the 
scenes struggle for influence, with "embarrassing" behavior - such 
 
MOSCOW 00001321  002.2 OF 002 
 
 
as Cherkesev's letter last year complaining about the conflict 
between the services.  Patrushev will move to the empty chair of the 
Secretary of the Security Council, a probable comfortable sinecure, 
and will be replaced by Army General Aleksandr Bortnikov, the deputy 
head of the FSB and Director of the Department of Economic Security 
at the FSB since 2004. 
 
2+2 Intact 
------------ 
 
¶7. (SBU)   Despite rumors that the Foreign Minister was interested 
in stepping down, FM Lavrov is a key holdover in the new government, 
underscoring the stability in foreign policy promised by both the 
outgoing and incoming Presidents.  Along with Defense Minister 
Serdyukov, the 2+2 architecture for U.S.-Russia relations remains 
intact. 
 
Five New Ministers 
------------------------ 
¶8. (SBU) Twelve ministers will hold onto their positions in the new 
government (see list below), although some will take on new 
responsibilities - like Minister for Natural Resources Yuriy 
Trutnev, who adds "ecology" to his portfolio.  Moreover, there was 
some shifting of accounts as the Ministry of Economic Development 
and Trade lost its "trade" responsibilities to the Ministry of 
Industry.  The Minister of Industry and Energy has lost 
responsibility for energy, as the Federal Energy Service is again 
bumped up to ministerial level (and hived off of the Industry 
Ministry).  The new government will add yet another new ministry for 
sport, tourism, and youth policies.  Five new faces will appear in 
the new government: 
 
- Sergey Shmatko, who had headed Atomstroyeksport, the company which 
manages construction of all NPPs Russia is building abroad, since 
2005, will take the helm at Energy. 
- Vitaliy Mutko, the nominee for Minister for Sport, Youth, and 
Tourism is a former St Petersburg politician - a friend of Putin and 
the late Anatoily Sobchak.  His background as former President of FC 
Zenit St Petersburg soccer team (Medvedev is a huge fan), former 
Chairman of the Russian Premier Soccer League, and current position 
as President of the Russian Football (Soccer) Union give him strong 
credentials for the position. 
- Aleksandr Konovalov, the President's Plenipotentiary to the Volga 
region since 2005 and former St. Petersburg prosecutor with close 
ties to Putin, will replace Vladimir Ustinov as the Minister of 
Justice. 
- Former head of the Presidential Protocol Igor Shchyogolev will 
replace Leonid Reiman as the head of the Ministry of Communications 
and Mass Media - the latter being a new portfolio for the ministry. 
Our contacts in the Telecom Ministry's International Cooperation 
Department were caught flat-footed by the announcement, saying that 
they "learned about it from the press." 
- In a surprise move, Russian Ambassador to France Aleksandr Avdeyev 
will replace Culture Minister Sokolov -- leaving some puzzled here 
as to the new appointment.  Aleksandr Avdeyev had a long, successful 
career with the Ministry of Foreign Affairs, heading the Department 
for CIS Affairs and several positions as ambassador to Luxembourg 
and Bulgaria. 
 
Comment: 
-------- 
¶9. (SBU) The structure of the new government reflects Medvedev's and 
Putin's priorities and, as expected, features experience and 
continuity - even with a few "surprises."  The optics of the meeting 
of the tandem, which took place in Medvedev's Kremlin office showed 
the two men playing their appropriate roles (although Putin, perhaps 
by habit, sat in his usual spot during the one-on-one meeting.)  The 
appointment of only seven deputies - far less than the 10-12 bandied 
about in the press - appears to undermine assertions that Putin was 
creating a "separate" cabinet, but also those theories that he would 
not be actively involved in the day-to-day running of the 
government.  The firings within the security services have taken 
many off-guard here, especially since today's announcements involve 
the heads of both silovik camps.  We will be following up with more 
in-depth coverage about the new personalities within the government 
and our assessments of the functioning of the government.