Scenes of protests wracked the streets of Moscow in December 2011 following widespread public outcry over alleged voting fraud in Russia’s parliamentary elections.
More protests followed in the run-up to the elections in March this year but Vladimir Putin finally emerged triumphant with an estimated 64 per cent of the vote.
While the West may remain sceptical of Putin’s intentions during his third term as president, a number of Russians believe his tenure will see a continuing focus on boosting the country’s economy, particularly in relation to the oil and gas sector.
‘I believe that a part of Putin’s success is due to the positive performance by the Russian oil and gas sector,’ says Valery Nesterov, an oil and gas analyst at Troika Dialog.
‘...we can play a constructive role within [Russian courts] and that’s an important change'
Chairman, Clifford Chance
As Nesterov highlights, under Putin, Russia has become one of the world’s largest producers and exporters of oil and gas. Certainly, this sector has been central to Russia’s success in recent years and although the government’s current privatisation programme aims to free up the economy and make it less dependent on oil and gas, Nesterov stresses that the sector will remain a strong locomotive of the economy.
As for the prospects for foreign investment under the new government, this remains to be seen, he says.
‘We will have to see to what extent the Kremlin will allow foreigners to get involved in the sector. There are signs that things are becoming more liberal, a good example being the Rosneft-ExxonMobil deal.
'There is a necessity to attract, one way or another, foreign investment and foreign companies to develop offshore oil reserves.’
In any case, as one leading Russian energy lawyer notes, there still remains a strong element of uncertainty over what will be in store until Putin’s policies are revealed and his cabinet is decided - this will only happen after he is officially sworn in again as president on 7 May.
‘'There is a necessity to attract, one way or another, foreign investment and foreign companies to develop offshore oil reserves.’
‘Unlike the UK or US, where it is expected that politicians explain their policies throughout their campaign, In Russia people vote for politicians based more on the popularity of the individuals rather than for their policies. Putin did not need to explain his plans as he already has a reputation as someone who has brought the country to new heights.’
Little of Putin’s policies have been revealed so far, noted Sir Andrew Wood, an associate fellow of the Russia and Eurasia Programme during a recent debate at Chatham House:
‘He's published a number of papers as to what he intends to achieve. They're notable for their gnomic aspects but it is extremely difficult to interpret precisely what they can mean in practice,’ he stressed.
Indeed, in terms of the oil and gas sector itself, one lawyer highlights that it is difficult to predict what will happen before we know whether Putin will choose to reappoint the incumbent minister of energy, Igor Sechin.
‘Sechin has been the proponent of the increasing role of the government in the oil and gas sector in recent years and is a reliable channel of governmental policy. There have been rumours that he will be replaced or given a new seat of responsibility, but we don’t know yet what will happen,’ he says.
Yuri Lyubimov, Deputy Minister of Justice
As for the effect on the Russian legal market more generally, although Russia’s deputy minister of justice Yuri Lyubimov notes that the elections have slowed down potential reform to the legal system, he is confident that Russia will stay an attractive market to both international businesses and law firms.
‘Russia lives and will live as a friendly market for international investors and international law firms. We all understand that international law firms bring their clients with them... they have brought much to our market, in terms of a new culture of work...and internationally recognised ethics of the profession,’ he commented during an interview with the IBA in November 2011.
According to Hugh Verrier, the chairman of White & Case, who had a long spell in Moscow earlier in his career, there has been considerable progress in the legal market over the past decade.
In an interview with the IBA in October 2011, Verrier highlights that there ‘was a time when we didn’t know whether we could play any meaningful role in a Russian court; that is, whether the outcome could be rational and something that we could contribute to constructively. Now, within a fairly short period of time, we’ve come to believe that it is a rational process. It has its issues, but we can play a constructive role within it and that’s an important change.’
While it is not quite clear what will be in store for the business or legal communities over the coming months, it seems unlikely that Putin will veer much from his usual consistent and cautious approach, says Nesterov. ‘We do not expect turmoil under Putin’s government but I doubt that he will endorse a fully liberal strategy for either the Russian economy or the Russian oil and gas sector.’